GIA is to close its lab in Ramat Gan, Israel, saying it is no longer “financially sustainable”.
The facility, which opened in August 2012, will close by the end of this year. Submissions will be sent to GIA labs elsewhere, with no additional shipping costs, the lab said in a press statement.
GIA was not able to say at this stage which other labs it would use (Dubai is the closest), or how much extra time that would take.
“Despite reductions in operating costs and reduced staffing through attrition, the laboratory is not financially sustainable,” said GIA, which grades the majority of the world’s polished diamonds.
“The GIA laboratory in Ramat Gan, Israel, will end operations by the end of 2024 due to changes in the global diamond industry that resulted in significant declines in submissions from local clients over the last several years.”
GIA closed its Antwerp lab in July 2022, citing “limited demand for services and financial performance that did not support continued operations”.
It also has labs in Bangkok, Hong Kong, Mumbai, Surat, Tokyo, Carlsbad, New York, Dubai, Gaborone and Johannesburg, according to its website.
From 17 November submissions to the Ramat Gan laboratory will be sent elsewhere. “GIA is working to establish a third-party process to accept submissions from walk-in clients in Ramat Gan for service in other GIA laboratories,” the lab said.
The Indian government is facing calls to adopt US guidelines to distinguish lab growns from natural diamonds.
The 10,000-member GJEPC (Gems and Jewellery Export Promotion Council) says there is widespread confusion in the way diamonds are marketed and advertised.
It says India should adopt the US Federal Trade Commission (FTC) guidelines, which say there must be a “clear and conspicuous” indicating that a diamond is man-made.
They also say the term “diamond” without qualification can only be used to refer to a natural, mined diamond.
And lab growns cannot be described as “real,” “genuine,” “natural,” or “precious” without additional qualifying language.
The GJEPC has written to India’s Department of Consumer Affairs calling for strict rules to differentiate between natural and lab grown.
“The absence of standardised guidelines on diamond terminology leads to ambiguity,” it says.
“And there are no mandatory disclosure requirements to indicate whether a diamond is lab-grown or natural to the consumer.”
The American Gem Society (AGS) will present panel discussions on lab grown diamond pricing and supply, advances in lab grown identification and the art of natural diamond storytelling.
The three-hour Confluence is an online-only event, featuring three pre-recorded sessions, designed to allow the speakers to take part in a live chat Q&A.
The event is scheduled for 25 September and will be accessible to non-AGS members for a $150 fee. The sessions will remain available, on demand, until 31 December.
The Importance of Diamond Screening: Challenges, Techniques, and Resources covers the latest screening technologies and their limitations, providing guidance on using gemological instruments for verification.
Laboratory-Grown Diamonds: Pricing, Supply, and Disclosure explores the complexities of the lab grown diamond market, including pricing dynamics and the importance of transparency.
And The Incredible Story of Natural Diamonds delves into the geological history and mining processes of natural diamonds, featuring insights from experts at GIA , which is sponsoring the event.
AGS is a nonprofit trade association representing a select group of jewelers, independent appraisers, and suppliers in the jewelry industry.
Since early 2022, the price of polished natural diamonds has fallen approximately 40% and the industry is being buffeted by negative economic headwinds, an excess of mine supply and too much stock in the cutting centres. However, there is one statistic that cannot be ignored: around 50% of Diamond Engagement Rings purchased in the United States now contain a Lab Grown Diamond (LGD). Is this just another cyclical downturn or are we in the middle of a major structural change?
Diamonds were once the preserve of royalty and the uber-wealthy, but the diamond market has evolved over the past 80 years into more of a mass market product with democratisation of the diamond consumer. Since the late 1970s most polished diamonds below 5 carats were priced against the 4 ‘C’s’ (carat, clarity, colour and cut), which led to standardised pricing in the form of polished diamond pricing lists. Up until the turn of the century these lists were primarily available in the wholesale market, but the arrival of internet pricing soon gave the consumer access to that same standardised pricing. In a world where everyone knows the price of everything, branding is the only differentiator. Without a differentiator, commoditised products end up selling for the lowest price.
It was why one of the questions that De Beers tried to answer when it changed its business model 25 years ago was: “How do you take a necessity (the diamond) priced like a commodity and market it as a luxury priced like a brand?”
Unfortunately, that question remains unanswered. The industry did create hundreds of so-called ‘brands’; origin, cut, settings, etc; the problem was that very few of them were real “brands”. If something does not sell at a premium, it’s not a brand, and most natural diamonds sell at a discount, yet the more that the industry was unable to achieve a premium, the more it becomes fixated with talking about the “product” when the luxury world has spent the last 25 years talking about “values”.
The challenge for most jewellers is not making a sale, it is making a reasonable margin. Ask a jeweller what they are selling and if they reply “VS1, G-H colour, loose polished, 1-caraters” then the most relevant word in their business will be “discounting”, because what they are selling is a commoditised version of “crystallised carbon.” There is no differentiator.
The LGD industry realised that to succeed it simply needed to persuade consumers that natural diamonds and LGDs were the same – “optically, physically and chemically”, but to also position them as “slightly cheaper”. They could then ride on the back of 80 years of De Beers diamond advertising differentiate themselves by claiming that LGDs were “conflict free”.
A larger “ethical” LGD for the same money as a natural diamond or pay less for the same size, created a money printing machine for everyone involved. And it’s no surprise that LGDs real success has been in the United States, because historically America has always been a “discount market”, and “larger for less” plays to that tune.
If all you want in a diamond is the sparkle, then they are in essence the same. Except there is a very real difference between the two, which is why some LGD executives insist on calling natural diamonds “earth mined” diamonds, because “natural” is exactly what differentiates them. The story of their age, rarity, origin; their social and economic contribution but above all, their “social purpose”. It was the failure of the natural diamond industry to tell that story which opened the door to LGDs.
When LGD production exploded, wholesale prices collapsed to around a 95% to 98% discount to their natural diamond equivalent. Prices vary according to quality, but anecdotal evidence suggests that today in the wholesale market, it is possible to buy a single polished LGD for $150 a carat, buy in volume and its possible to pay as low as $80 a carat.
Many retailers have also dropped their LGD prices, but by no means as far, and even pricing LGD at a 20-40% discount to their natural diamond equivalent can still leave a very significant margin. Pandora will sell you a 1-carat LGD ring for $1,950. Helzberg Jewellers (a Warren Buffet company) will sell you a similar LGD for $1,999. It’s very likely that some in the LGD industry are making a gross margin of 200%, some much more for a product that Signet Jewellers sensibly cautiones it customers “Their relative abundance may not ensure the value will hold over time”.
Whatever happens to future LGD retail prices, the category has got itself into the American consumer psyche and that won’t easily change, although there are also two sides to this story. I heard of a jeweller who was recently asked by a HNWI to make a replica of her 8-carat natural diamond ring so she could wear it travelling. The original ring cost $500,000 but he sourced an equivalent LGD for $5,000, and apparently she was absolutely thrilled with it. The question is, will she buy natural again? On the other hand, if in the future a consumer could buy (for example) a 2-carat LGD engagement ring for below $200, how pleased would their fiancé be to receive it – Walmart recently had a 2-carat LGD ring for sale for only $257. How romantic!
The US bridal market (size over quality) is dominated by larger, lower quality diamonds. Since similar sized LGDs are cheaper (or you get a much better quality LGD), either that market disappears, or demand only reappears aner prices have fallen sharply (already happened). It is also likely that LGDs will replace small, lower quality natural diamonds in fashion jewellery – as they may replace the smaller stones in high-end pieces of natural diamond jewellery. Diamond mining companies whose profitability rely on these categories of diamonds probably need to find a new value proposition, or their days may be numbered.
For those in the natural diamond industry who can adapt, there is huge potential. For those that don’t, as the saying goes, “Kodak never saw it coming either”.
Except Kodak did see it coming; they just didn’t know what to do about it. Kodak was killed off by digital photography which ironically, they invented, patented, but didn’t know how to exploit it, so they franchised the technology and made a fortune until their patents expired, and then went bust. Have LGDs done the same to natural diamonds? “No”, the opposite; their success is forcing a complacent industry to change. Have they changed the paradigm? “Completely”.
Namibia is one of Africa’s top five diamond exporters, right behind Angola, Botswana, and South Africa. In 2022, the country exported more than $940 million worth of diamonds.
The world’s demand for natural diamonds has bounced back from a slump during the COVID-19 pandemic, with Namibia’s largest marine dining company, Debmarine, reporting a sales increase of 83% in 2022 from the previous year.
Still, Debmarine CEO Willy Mertens is worried about competition from synthetic diamonds, sector of the business that could cost many Namibians their jobs.
Though trained jewelers can tell the difference between lab-grown and natural diamonds, there’s nothing obvious to distinguish lab-grown diamonds from natural ones.
The Modern Mining publication recently said that in 2022, lab-grown diamond jewelry surpassed 10% of the market of global jewelry sales for the first time. The publication said artificial diamond sales are forecast to continue growing at an annual double-digit percentage rate in coming years.
Namibia, where workers extracted 2.1 million carats in diamonds in 2022, is embarking on a campaign to tout natural diamonds as environmentally sound and holding greater value for the money.
“We’ve seen in the past couple of years that lab-grown diamonds, or synthetics as you call them, have sort of infiltrated the natural diamond market,” said Mertens. ” … people were first marketing them as real diamonds and we’ve done a lot of work around trying to differentiate them.”
One of the challenges of marketing Namibian natural diamonds is the environmental impact that diamonds have on the landscape.
Mertens said Debmarine invests a significant amount of its profits into environmental rehabilitation and restoration of landscapes and the seabed damaged by mining.
“The restoration of the seabed actually happens naturally as the waves move,” Mertens said. “So what we are doing is that we are monitoring that, and what we do is we mine out a specific area and we leave an area next to it vacant, and over time we monitor how the area where we have recovered diamonds looks like compared to the one that was not touched and we’ve seen that it takes about three to 10 years maximum for that to completely restore. By completely restoring, mean about 70% of the organisms have returned to that place. On the land, it is sand that we are moving and what we do now is that we are using that same sand to keep the sea walls in tact.”
Mertens recently paid a courtesy call on Namibian President Nangolo Mbumba, to introduce the De Beers global ambassador for natural diamonds, Hollywood actor Lupita Nyong’o, and talk to the president about challenges facing Namibia’s diamond industry.
De Beers Natural Diamonds Global Ambassador Lupita Nyong’o, left, Namibia President Nangolo Mbumba, center, and Debmarine CEO Willy Mertens in Windhoek, Namibia, July 19, 2024. (Vitalio Angula/VOA) De Beers Natural Diamonds Global Ambassador Lupita Nyong’o, left, Namibia President Nangolo Mbumba, center, and Debmarine CEO Willy Mertens in Windhoek, Namibia, July 19, 2024. (Vitalio Angula/VOA) President Mbumba lamented a proposal for the Kimberley process — the process meant to screen out so-called “conflict diamonds” from entering the international market — to begin certifying all diamonds in Antwerp, Belgium.
The Group of Seven largest economies said that is an effort to prevent Russian diamonds from being sold abroad.
Mbumba said the measure would hurt African diamond producers.
“Recently, the decision was made by the G7 countries to route all rough and polished diamonds destined for G7 countries via Belgium,” said Mbumba. “This decision poses a serious risk and threat to our economies, especially the economies of Angola, Botswana and Namibia by increasing the cost as well as curtailing freedom of trade for our countries’ products.”
Namibia’s president said he and his counterparts from Angola and Botswana have written a letter to the G7 to ask them to halt their plans.
New Delhi: India’s lab-grown diamond industry is facing challenges such as significant fall in prices, eroding consumer interest and competition from imports, think tank Global Trade Research Initiative (GTRI) said Sunday, adding said that though India faces the issue of production overcapacity, it continues to import in large amounts and this issue needs deeper investigation.
To address these challenges, the government needs to take certain steps such as setting clear and consistent rules to standardize quality, certification, and market practices; issuing a Quality Control Order to check quality of imports; and investment in research and development to improve production processes, reduce costs, and enhance the quality of lab-grown diamonds.
As per the report, India’s lab-grown diamond industry is facing a major challenge, with prices falling by 65% in the past year to Rs 20,000 per carat from Rs 60,000 due to local overproduction and oversupply from abroad, which points to problems like overproduction, high imports, and lack of regulation. The number of units producing lab-grown diamonds in India has increased to 10,000 units, leading to over supply and tougher competition.
The industry lacks clear regulations checking such practices, making it hard to ensure quality. Lack of proper certification, and low trust market operations could slow down the industry’s growth, according to GTRI founder Ajay Srivastava.
He added that 98% of India’s imports of rough lab-grown diamonds come from Hong Kong (63.7% or $728.2 million) and the UAE (28.5% or $326 million).
In FY24, India imported rough lab-grown diamonds worth $1.14 billion and exported cut and polished ones worth $1.3 billion.
Natural diamonds cost around Rs 3.5 lakh per carat and this price drop is making it difficult for manufacturers to repay loans taken for purchasing lab-grown diamond making machines, putting them under financial strain, GTRI said.
Swarovski celebrated the launch of Swarovski Created Diamonds with an event held at the new Chadstone store in Melbourne, Victoria. VIP guests and friends of the House includingMaria Thatill, Maxine Wylde, Jessie Murphy, Charlene Davies and Tayla Broad enjoyed a day filled with joyful extravagance which included a Swarovski Created Diamonds styling session.
The Swarovski Created Diamonds collection includes ‘Galaxy’, the latest range by Global Creative Director Giovanna Engelbert, which takes its inspiration from the birth of the cosmos. The 19-piece collection includes necklaces, rings, earrings, and bracelets in a dazzling array of diamond cuts, expertly crafted to capture and transform the light. For its launch in the Chadstone store, Galaxy Collection showpieces shone in a special display, reflecting Engelbert’s cosmic inspiration.
Giovanna Engelbert commented: “The confluence of diamonds, Swarovski’s heritage, and my creative vision has culminated in a collection that embraces the birth of new dimensions for the universe of Swarovski. The endeavor of meticulously creating diamonds to reflect light in mesmerising ways was remarkable, and what truly excites me is the accessibility to this beauty, thereby elevating the possibilities of customers’ creativity in their self-expression.”
Crafted with Swarovski’s exquisitely cut laboratory grown diamonds, which are identical to mined diamonds in every way but origin, Swarovski Created Diamonds fine jewellery collections showcase the brand’s mastery of light and savoir-faire. They are created with 100% renewable energy and recycled gold and silver, and only diamonds of the highest quality are used, with each stone certified by the International Gemological Institute (IGI) according to the 4Cs of diamond quality – cut, colour, clarity, and carat weight.
With its long heritage of precision cutting, innovation, and artistry since 1895, entry into the fine jewellery market is a natural evolution for the 129-year-old luxury brand. Swarovski Created Diamonds collections will be rolled out in flagship stores and key markets globally.
Police in Surat, India, are investigating an alleged switch, in which a “buyer” replaced a 10.08-carat natural diamond, valued at $545,000, with a near-worthless lab grown replica.
The “buyer” examined the heart-shaped D / VVS2 stone and its GIA certificate, agreed terms and put down a $12,000 down payment to secure the purchase.
He left, saying he needed to withdraw money – and has not been seen since.
The owner of the diamond soon realized he’d been left with a lab grown replica of identical shape, color and weight, but worth less than $2,000.
Police say they are pursuing the “buyer” and at least two accomplices, according to a report in the Economic Times.
According to Vantage Market Research the Global Lab Grown Diamonds Market Size is expected to reach a value of USD 27.2 Billion in 2023. The Lab Grown Diamonds Market is projected to showcase a CAGR of 9.1% from 2024 to 2032 and is estimated to be valued at USD 59.5 Billion by 2032.
The lab-grown diamonds market has emerged as a formidable force within the diamond industry, captivating consumers with its ethical and sustainable approach to creating stunning gemstones. Unlike mined diamonds, which are extracted from the earth through an environmentally impactful process, lab-grown diamonds are meticulously crafted in controlled laboratory environments.
This innovative technology replicates the natural diamond formation process, resulting in stones with the same physical, chemical, and optical properties as their mined counterparts. The burgeoning lab-grown diamond market is fueled by a confluence of factors, including rising environmental consciousness, evolving consumer preferences, technological advancements, and increasing disposable incomes.
Pandora’s abandonment of mined diamonds has apparently not hindered its standing with younger consumers.
Speaking to the Financial Times (FT) Tuesday (May 7), Alexander Lacik, CEO of the mass-market jeweler, said younger buyers helped fuel a boom in lab-grown stones that had led to a decline in sales of mined diamonds, and helped the company best its luxury rivals.
Lab-grown diamonds are opening up the industry to new consumers, he said, as these stones are usually about a third of the cost of the alternative.
“People are discovering that a diamond is a diamond. It’s a different value proposition, and people are voting with their wallets,” Lacik told the FT. “Older customers are more wedded to mined diamonds. Younger ones are more open to lab-grown.”
The report notes that Pandora became the first major jeweler to move to a lab-grown-diamond-only strategy in 2021 as it pushed to expand its offerings beyond the charm bracelets and necklaces for which it had been known.
The company nearly doubled its sales of lab-grown diamonds in the first quarter, increasing revenue by 87%, the FT said.
Gen Z’s embrace of lab-grown diamonds makes sense in light of PYMNTS Intelligence research showing that this age group — more so than other younger consumers — is most likely more likely to point to buying an expensive retail product as their main financial goal than to mention paying for an upcoming event or show.
“In fact, consumers in this group are seven times as likely to prioritize the former as the latter,” PYMNTS wrote last month.
By contrast, millennial and bridge millennial consumers were the most likely to list paying for an event or show as their top goal.
“By 2030, barely five years from now, Gen Z will represent a third of the workforce. Their disposable income is projected to increase by sevenfold and their spending by sixfold as their incomes rise and they begin to benefit from the $90 trillion transfer of wealth headed their way from parents and grandparents,” PYMNTS CEO Karen Webster wrote recently.
“For that reason, Gen Z is the generation that all businesses are courting — they are their future workers, customers, business partners and investors.”
At the same time, this age group is also struggling to make ends meet, with 59% of Gen Z consumers living paycheck to paycheck, despite half of them not paying rent or mortgage.
“With such a financial cushion, the question remains as to why these young adults struggle to live within their means,” PYMNTS wrote last month. “One answer: Gen Z consumers cite splurging on nonessential items as a top reason for their financial lifestyle.”
