Traditional mined diamond industry is trying real hard to create an illusion of failure in the emerging lab grown diamond sector. We recently heard about claims of lab grown diamond prices dropping even though an extensive survey conducted in late 2018 by MVI Marketing conclusively reports the opposite: people love the value offered by lab grown diamonds.
So, on one side there’s a single brand claim and on other side there's an objective and rather visible trend – you can choose which one to believe.
Thomas Moses, executive vice-president of GIA was quoted in a news report that lab-grown diamonds will be ‘pretty prevalent’ in the market over the next year or two. It is this growing demand and interest for lab grown diamonds that has contributed to stability in prices. Based on latest MVI research (link as above) and data gathered from our members, it’s clear that prices of certified lab grown diamonds specifically in bridals (one carat and more) haven’t declined.
In fact, IGDA member Diamond Foundry hiked prices by 15%. Read about how the company has priced its diamonds here. Diamond Foundry company reports that it has seen ‘demand increasingly outpacing supply!’ The sentiment holds for other growers and suppliers too.
Clean Origin’s founder Alex Weindling told Yahoo Finance, that demand for larger lab-grown diamonds, the kind mostly reserved for center stones in engagement rings, have continued to outstrip supply. “Their [prices are] not coming down, I don’t have enough,” he said. “I have to turn away customers.”
Another IGDA member, MiaDonna confirmed that they have not seen any price decline. “I only use reputable lab-grown diamond manufacturers and I have seen them stay consistent or increase slightly. We are still growing at 30% every year with plans of growing at 50% this year and we have not adjusted our retail prices since we set our prices years ago,” replied Anna-Mieke Anderson (MiaDonna) to IGDA’s queries on lab grown diamond prices. IGDA member, Tom Chatham also confirmed that prices of Chatham Inc’s lab grown diamond jewellery remained stable with increased sales in 2018.
What mined producers failed to clarify was that any and all fluctuations in prices have been restricted to small ‘melee’ diamonds (this includes lab grown & mined diamonds) which are used for lower end fashion jewellery.
IGDA routinely gather extensive feedback from producers and trade members and our members have maintained their prices of ‘certified lab grown diamonds centers & lab grown diamond bridal jewellery.’ By virtue of being certified, lab grown diamond centers add validity for consumers, allowing retailers to close sales quickly. In last 12-15 months, with FTC acknowledging lab grown diamonds as ‘diamonds,’ there has been an increased interest from retailers to stock lab grown diamonds because consumers want to see them in stores, a clutch of new lab grown diamond brands, and endorsements by celebrities has helped the lab grown diamond sector immensely. Each one of these has helped multiplied interest in lab grown diamonds.
Recent analysis of ABN-AMRO report further validates what IGDA and its members are witnessing: “We think that 2019 and 2020 will be the years that lab-grown diamonds take off … This has serious consequences for the actors in the diamond industry. Natural diamond buyers such as retailers, consumers and jewellery manufacturers will likely de-stock and hold less inventory. This will result in lower demand for natural diamonds and weigh on prices.”
With lab grown diamonds experiencing significant market penetration, it’s unfortunate that traditional diamond industry is resorting to unfounded claims to drive their point. We see the price stabilization among bridals (weighing up to 1 carat and more) is a positive trend for the diamond & jewellery market, signaling an upswing in demand.
Furthermore, it provides relief for the long-embattled wholesale & retail sector of the diamond pipeline. In 2018, 893 retail jewelers in North America (852 in the US and 41 in Canada) ceased operating, according to the Jewelers Board of Trade (JBT). Some of these retailers closed, others were acquired or merged. Some of them filed for bankruptcy. For jewelry manufacturers and wholesalers, the past year was not without its difficulties. When retail sinks, so do they.
But as larger retailers embrace the lab grown diamond and assortments expand beyond & within the bridal category, there’s plenty of room for growth for everyone. Now, there’s no reason why everyone in the diamond pipeline can’t make profits!