Making the Switch: Are Lab-Grown Diamonds Now the Superior Choice?

For the longest time, the diamond market was an unstoppable monopoly that controls every market aspect. From mining to cutting to certification, there wasn’t much room to break in the industry. Internationally, the United States is the second-largest exporter of diamonds with a 16.5% share of the global market. That is worth $17.7 billion. It seems that the decision to invest in the diamond industry is as clear as an authentically cut gem. Well, almost.

According to a recent “Global Diamond Report 2020-2021“, the global diamond jewelry market dropped to sixty-four billion dollars in 2020 from eighty billion dollars in 2018. Rough diamond production is on a downward trend, and it isn’t expected to recover until 2022-2023 in the U.S fully.

Investing in diamonds was already a perilous venture before the pandemic. These days, the market’s instability sparks hesitation and fear among investors and the likes as it adds another layer of risk. Fortunately, there is an alternative: synthetic diamonds.

Quality Is Curated

Synthetic diamonds or lab-grown diamonds (LGD) are created in laboratories and are nearly identical to their natural counterparts in every way. The only significant difference is that the former is grown in a lab, and the latter is mined below the earth. It is impossible to tell the difference as even their chemical structures are similar. LGDs are not the same as moissanite or cubic zirconia. They are also not a lesser alternative to the traditional option.

Pandora, one of the world’s leading jewelry suppliers, recently announced that they are officially switching to lab-grown diamonds from previously selling and using its mined alternatives for their products. According to chief executive Alexander Lacik, this broad move is part of their more expansive sustainability drive in shedding light on the environmental and ethical practices of the mining industry. Indeed, it is a game-changer for the fashion jewelry industry. LGDs are slowly becoming the more preferred choice, and it’s easy to see why.

Mining authentic diamonds is a long and arduous process. Once extracted and cut, each diamond undergoes a thorough and independent evaluation according to the GIA diamond grading system. It is taken to a laboratory to evaluate its four Cs: carat weight, cut, color, and clarity that determine its price. Finally, a certificate is given indicating that professional gemologists have impartially judged it.

As you can see, searching for diamonds doesn’t always imply riches. The value of the diamond can depreciate significantly depending on the subjective view of the beholder. It’s unsustainable to the environment and inconsistent in its results. If that isn’t bad enough, mined diamonds sometimes go by a more notorious name — blood diamonds — because it destroys local habitats, wildlife, and endangers the workers’ health.

Synthetic diamonds are grown in a lab from a diamond seed made up almost entirely of pure carbon. They replicate the exact natural process that a natural diamond undergoes. Professionals can easily curate it to match different levels of the four Cs. The only limit is how much the buyer is willing to pay.

Some companies even offer customers customized diamonds based on their preferences and price point. Right now, the whole procedure creates LGDs that cost 40% less when compared to the same value of a naturally mined one. That price will only become more affordable as technology improves. LGDs are consistent, environmentally safe, ethical, and inexpensive; clearly, artificial is the best choice.

Investment Opportunities

The only thing holding Lab-grown diamonds back is that demand far exceeds their supply. The estimated total value of LGDs is $150 million per year, and predictions claim that it will surpass the $1 billion mark in a few years.

It is wise to invest in stocks before that big boom happens. As an investor, you would want to place your money towards a company that fully explores how technology can benefit the process. Experts are entirely on board promulgating this cheaper alternative as it shatters the century-old cartel of diamond monopolies, forcing them to change their ways as well.

Ethics in The Future

The world is feeling the disastrous effects of climate change. Companies and financial institutions are expected to be more socially responsible with their businesses. Young and upcoming investors are making a stand with their money. Thus, companies must reassess if their business model is ethical and environmentally stable or risk losing it all.

Official sources have only recently acknowledged Lab-grown diamonds as authentic gemstones. But the stigma that it is fake and a lesser quality alternative still prevails. With the proper marketing and intelligent investments, Lab-grown diamonds are the future to a more affordable, better quality, and highly sustainable diamond market.