Lab-GrownSep 21, 2022
An Updated Look at the Lab-Grown Diamond Market: Size, Pricing, and More Lab-GrownSep 21, 2022
Looking Ahead: 4 Factors That Could Shape Lab-Grown Diamonds’ Future
Growing supply and falling prices likely will make differentiation a necessity and a reality, according to analyst Paul Zimnisky.
A worker at the Lightbox factory in Gresham, Oregon, where De Beers Group grows diamonds. Consumer demand for lab-grown diamonds is increasing, begging the question, what will the market look like in 10 to 15 years? Analyst Paul Zimnisky shared his viewpoints in a new report. (Photo courtesy of Lightbox/De Beers Group)
New York—Lab-grown diamonds are the category currently sparking the most conversation in the industry, from the debate over stocking the stones, to the questions of who is buying them, and who might be selling them in the near future.
But in his latest report, industry analyst Paul Zimnisky is taking a more long-term view of the market, telling National Jeweler, “I think the key is to really take a step back and [ask], where is this going to go longer term?”
Published in early August, “What a Mature Lab-Grown Diamond Jewelry Market Could Look Like” outlines the four primary factors Zimnisky believes could shape the lab-grown diamond jewelry market in the next 10 to 15 years.
The first is limitless supply.
According to Zimnisky’s data, the volume of rough diamonds grown for use in jewelry really began to take off around 2018, the same year De Beers Group launched its lab-grown diamond jewelry brand, Lightbox.
He predicts production will continue to climb through the end of the decade, nearing 25 million carats (excluding melee) by 2030, a substantial increase for the category but still just a fraction of global natural diamond production, which reached 120 million carats last year.
China and India, where multiple longtime manufacturers of natural diamonds have gotten into the lab-grown business, are expected to be the top producers.
As production of lab-grown diamonds continues to increase, so will the quality of the stones, which lays the groundwork for the second characteristic Zimnisky believes will shape a mature lab-grown diamond market—the stones likely will be high quality across the board.
The development, the industry analyst contends, could render the grading of lab-grown diamonds unnecessary.
Related stories will be right here …
But in his latest report, industry analyst Paul Zimnisky is taking a more long-term view of the market, telling National Jeweler, “I think the key is to really take a step back and [ask], where is this going to go longer term?”
Published in early August, “What a Mature Lab-Grown Diamond Jewelry Market Could Look Like” outlines the four primary factors Zimnisky believes could shape the lab-grown diamond jewelry market in the next 10 to 15 years.
The first is limitless supply.
According to Zimnisky’s data, the volume of rough diamonds grown for use in jewelry really began to take off around 2018, the same year De Beers Group launched its lab-grown diamond jewelry brand, Lightbox.
He predicts production will continue to climb through the end of the decade, nearing 25 million carats (excluding melee) by 2030, a substantial increase for the category but still just a fraction of global natural diamond production, which reached 120 million carats last year.
China and India, where multiple longtime manufacturers of natural diamonds have gotten into the lab-grown business, are expected to be the top producers.
As production of lab-grown diamonds continues to increase, so will the quality of the stones, which lays the groundwork for the second characteristic Zimnisky believes will shape a mature lab-grown diamond market—the stones likely will be high quality across the board.
The development, the industry analyst contends, could render the grading of lab-grown diamonds unnecessary.
The lack of grading reports, coupled with an increased supply, will further drive down the price of lab-grown diamonds, which already are significantly cheaper than natural diamonds.
According to Zimnisky, in mid-2018, a generic (non-branded) 1-carat, G VS1 lab-grown diamond retailed for $3,625, compared with $6,600 for a natural diamond of the same size and quality.
Today, that same lab-grown diamond retails for $1,615 while the natural is $6,705.
“Longer-term, it will likely be higher-priced lab-grown diamond jewelry that competes the most with natural diamonds.” — Paul Zimnisky, industry analyst
The expectation that prices will continue to drop sets the stage for the final two factors to come into play—branding and proprietary design, and custom shapes and colors.
There are existing jewelry companies positioned to pull off a “luxurious” version of lab-grown diamonds by leveraging existing brand value, with Zimnisky noting in his report, “A product does not necessarily need to be limited by nature for it to be rare or luxurious.”
He points to the Hermès Birkin bag as an example.
Hermès deliberately limits the supply to drive up value, and it works, with the coveted handbag trading hands for tens of thousands of dollars, at least, on the secondhand market.
“Theoretically, if Hermès came out with an exclusive, limited-edition lab-grown diamond ring, it would likely be perceived by consumers as an Hermès ring first, and a lab-grown diamond ring second,” Zimnisky writes.
“Longer-term, it will likely be higher-priced lab-grown diamond jewelry that competes the most with natural diamonds.”
Two pieces in “Pandora Brilliance,” the popular jewelry brand’s new collection of lab-grown diamond jewelry. The line launched in the United States in August following a test in the U.K.
He does, however, see the opportunity for a “bridge” category of lab-grown diamond jewelry to emerge, lines that are lower-priced but affiliated with “premium” brands.
He points to “Pandora Brilliance,” the popular charm brand’s lab-grown diamond line that arrived in the United States late last month, as a current example.
Tested in the U.K. and proven to be more popular for gift-giving than for self-purchase, the line seems poised to take off in the U.S., with 33 styles to choose from in sterling silver or 14-karat gold and prices starting at $300.
“Pandora will be successful,” Zimnisky said. “They already have the right customer, distribution lined up, the right price point. It fits their business model better than anyone [else’s], in my opinion.”
Like branding, the fourth factor expected to shape the future of the lab-grown market—custom shapes and colors—will be a path diamond growers pursue in order to set themselves apart as prices fall and quality equalizes across the board.
Growers will take advantage of the stones’ lower prices to experiment in ways not possible or financially feasible with natural diamonds, Zimnisky said.
Indeed, some shape and color experimentation has popped up in the market already.
In 2018, Apple’s Jony Ive and design partner Marc Newson partnered with diamond grower Diamond Foundry in 2018 to create a ring entirely made out of diamond, while Swarovski rolled out of a line of imaginatively named lab-grown diamonds in a wide variety of colors in early 2020.
“People will eventually be able to go to a website and get a diamond cut into whatever shape they want,” Zimnisky predicts, whether it’s a Star of David, a cross, or a cat.
“What a Mature Lab-Grown Diamond Jewelry Market Could Look Like” is available in its entirety on Zimnisky’s website.
More on Lab-Grown
The Latest
MajorsJul 26, 2024
Diamonds Direct Opens Store in AtlantaIt’s the Signet-owned banner’s first location in Georgia.
TrendsJul 26, 2024
Piece of the Week: Bea Bongiasca’s ‘Double Loop’ EarringsCommemorate “brat summer” with these green hoops.
EditorsJul 26, 2024
Out & About: A Dispatch from the Nation’s Smallest StateEditor-in-Chief Michelle Graff returns from Rhode Island with thoughts about in-store shopping and a trends report.
Brought to you by
The End of an Era? Lab-Grown Diamonds' Journey Towards Price StabilityAs the demand for lab-grown diamond jewelry may still be increasing, the most notable change we are likely to see is price stabilization.
Supplier BulletinJul 25, 2024
Meet Gemology’s Next Generation Microscope: GIA® Gemolite® NXT Professional EditionSponsored by Gemological Institute of America
Weekly QuizJul 25, 2024
This Week’s QuizTest your jewelry news knowledge by answering these questions.
TechnologyJul 25, 2024
Amazon, BBB Sue Website Allegedly Peddling Fake Reviews They claim ReviewServiceUSA.com was selling both positive and negative reviews of products and businesses.
SourcingJul 25, 2024
De Beers’ H1 Revenue Falls 21% in ‘Weak’ MarketLab-grown diamond sales in the United States and ongoing economic challenges in China are impacting natural diamond demand.
Brought to you by
Meet Gemology’s Next Generation Microscope: GIA® Gemolite® NXT Professional EditionGIA®’s most advanced microscope has new features to optimize greater precision and comfort.
IndependentsJul 25, 2024
Store Designer Ruth Mellergaard DiesA longtime member of IJO, she’s remembered for her passion for design, learning, and environmentalism.
FinancialsJul 25, 2024
Boucheron, Pomellato Post Double-Digit Growth in Q2 The gains come amid a tough time for parent company Kering, which saw sales slide 11 percent in the first half of the year.
MajorsJul 25, 2024
Shane Co. Partners With Kids In Need Foundation to Donate 7,200 BackpacksThe fine jewelry retailer filled backpacks with back-to-school essentials for students in 13 states.
FinancialsJul 24, 2024
LVMH’s First-Half Jewelry, Watch Sales Dip 5%Tiffany & Co. is focusing on its “iconic” collections while the company has made changes at the top at TAG Heuer and Hublot.
MajorsJul 24, 2024
See Chaumet’s Paris Olympic Medals Inspired by its High JewelryThe Parisian brand is the first jewelry company in the history of the Olympic and Paralympic Games to design the medals.
MajorsJul 24, 2024
Jewelers Mutual Acquires Pawnbroker Insurance ProviderUnion Life & Casualty will join JM Insurance Agency Partners, expanding the provider’s pawnbroker coverage.
MajorsJul 24, 2024
Ben Bridge Announces 2024 Lonia Tate Scholarship WinnerLos Angeles-based Bradlei Smith was selected for this year’s award.
ColumnistsJul 23, 2024
Peter Smith: The Case for Optimism in Sales In his latest column, Smith shares multiple reasons why people who look at the glass as being hall full often make better salespeople.
SourcingJul 23, 2024
De Beers’ Production Drops 15% in Q2The company also reported the $150 million sale of an iron ore royalty right, part of its ongoing effort to divest “non-core” assets.
IndependentsJul 23, 2024
Long’s Jewelers Is Giving Away a Luxury Cape Cod VacationThe giveaway is part of the New England jeweler’s summer bridal event.
CollectionsJul 23, 2024
Guzema Debuts ‘Flower Power’ CampaignThe ad features three celebrity florists creating floral sculptures while wearing jewelry by Guzema.
Policies & IssuesJul 23, 2024
Diamonds Do Good Announces Its 2024 Entrepreneurship Grant WinnersThe grant provided a total of $100,000 to support 13 entrepreneurs from diamond communities in Africa and India.
CrimeJul 22, 2024
Florida Jeweler Shot, Killed Following Argument With CustomerGhazi Michel Osta, or “Gus,” was killed Friday by an 83-year-old man said to be a frequent customer at his store, Volusia Gold & Diamond.
Policies & IssuesJul 22, 2024
JVC’s Elyssa Jenkins-Pérez Joins RJCThe organization also announced Effie Marinos as its new specialist advisor for technical standards, as well as four other appointments.
SourcingJul 22, 2024
AWDC Names Karen Rentmeesters as CEORentmeesters has served as interim CEO since April following former CEO Ari Epstein’s resignation.
IndependentsJul 19, 2024
Longtime D.C. Jeweler Brian Mann Dies at 70Mann, whose family’s jewelry store was located inside the Pentagon, is remembered for being a thoughtful champion of the industry.
IndependentsJul 19, 2024
The 1916 Company Opens New Tudor BoutiqueThe 500-square-foot boutique is located in Denver’s Cherry Creek Shopping Center.
CollectionsJul 19, 2024
Piece of the Week: Messika’s ‘So Move Max’ NecklaceDance all night long with the “So Move Max” set’s necklace.
WatchesJul 18, 2024
TAG Heuer, Hublot Will Have New CEOs Luxury giant LVMH is reshuffling the leadership in its watches division.
