Diamonds, From Your Ring to Your iPhone (and will people start buying engagement rings with man made diamonds?)

This Valentine’s Day could see gems grown in a lab take market share from natural ones

By Jinjoo Lee of The WSJ. Excerpts:

"Lab-grown diamonds have essentially the same chemical, optical and physical properties as mined diamonds, according to the Gemological Institute of America. Yet they can be bought at a fraction of the cost. 

On Blue Nile, an online jewelry retailer owned by Signet Jewelers, a 1-carat colorless round lab diamond goes for $1,534, which is about 73% cheaper than the lowest-priced natural diamond with the same specifications on its website. That pricing gap has widened over time."

"Lab-diamond jewelry also has a strong pull for consumers who care about sustainability and ethical sourcing. In December, lab diamonds accounted for 15.7% of all engagement rings sold in the U.S., up from 7.9% a year earlier"

"Unlike the natural-diamond industry, where a cartel controlled the supply of stones for the better part of the past century, lab-grown diamond production is subject to cutthroat competition. It costs just about half a million dollars—sometimes even less—to buy reactors or chambers for chemical vapor deposition (CVD)"

"involves pumping carbon-containing gas (such as methane) into a sealed, superheated chamber housing a small piece of diamond. The process prompts carbon atoms to form a structure around the seed diamond."

"The cost of production is rapidly declining. Martin Roscheisen, CEO of San Francisco-based Diamond Foundry, says in an email that the cost of producing a lab diamond has declined by about 12% each quarter over the past five years at his company. "

"Lab diamonds haven’t affected the value of natural diamonds so far, but the industry hasn’t faced a real test because demand for all diamond jewelry surged between 2020 and 2022"

"Engagement rings tend to be a symbolic and emotional purchase, so there could still be lasting demand for a stone that took millions of years to form. Even so, a flood of supply probably means diamond jewelry will become more commoditized."

"Proceeds from lab-diamond rings could fund an even larger, if distant, ambition: making their way into semiconductors. WD Lab Grown Diamonds, Diamond Foundry and De Beers’s Element Six are all developing diamonds for industrial use"

Related post:

Is it okay to propose to your sweetheart with a diamond that was made in some drab office park? (2017)