While lab-grown diamonds make up only about 10 per cent of total sales, their share of the overall market more than doubled between 2020 and 2022
When Isabelle Crew chose a lab-grown diamond instead of a traditionally mined sparkler for her engagement ring, one friend warned her it would have a lower resale value.
But with the 1.7-carat oval-shaped diamond solitaire of her dreams twinkling on her finger, the 28-year-old Toronto woman says she found it easy to laugh off those concerns.
“This is an engagement ring. I really hope I don’t have to resell it someday,” Crew said.
Three years later, Crew — who chose a lab-grown diamond primarily for environmental and social reasons — remains happily married and happy with her ring. And the “resale value” comment notwithstanding, Crew said most people’s reactions to her choice have been positive.
“I’ve had so many compliments on my engagement ring … and I think now honestly at least five of my friends have followed suit,” she said.
More than 70 years after international mining giant De Beers came up with its hugely profitable “A Diamond is Forever” advertising campaign, diamonds have grown into a US$84-billion market.
But while the diamond is still embraced in 2022 as a symbol of lasting love, millennials and Generation Z are increasingly rejecting stones formed naturally in the Earth’s crust in favor of man-made, lab-grown alternatives.
In fact, industry statistics show that lab-created diamonds are outpacing growth in the overall diamond market. While lab-grown diamonds make up only about 10 per cent of total sales, their share of the overall market more than doubled between 2020 and 2022.
Lab-grown diamonds are real, not fake, and they have the same physical, chemical and optical characteristics as mined diamonds. But rather than occurring naturally over the span of billions of years, man-made diamonds are created in labs using a vastly accelerated process that takes just weeks.
Most lab-grown diamonds today are created using a process called chemical vapor deposition, or CVD. A small slice of a diamond, or “seed,” is placed in a sealed chamber which is then filled with compressed gases (usually methane and hydrogen). The chamber is then heated, which splits the gases and allows the carbon atoms to begin to “build” around the diamond.
The result is a gem that, to the naked eye, is identical to a natural one, said Luke Sinclair, chief financial officer of Groupe RSL. The Canadian company uses hydroelectricity to power its lab-made diamond process at a facility in Quebec.
“The difference really lies in the consumer perception of the two. That’s really the only difference,” said Sinclair.
“When you think about it, it’s a bit funny that lab diamonds are perceived as non-luxury just because they’re man-made,” Sinclair said. “Most, if not all, luxury goods are man-made. Purses, cars, shoes — these are all man-made, luxury items.”
Part of the allure of lab-grown diamonds for consumers is that because they can be mass-produced and don’t have the rarity of natural diamonds they sell for, on average, about half the cost of a traditional stone — though that may change in the future as lab diamonds become more popular.
But many young consumers are also attracted to the sustainability claims. According to a 2018 survey by MVI Marketing LLC, 70 per cent of millennial-aged consumers would consider buying a lab-grown alternative in an effort to reduce the carbon footprint, deforestation and wildlife habitat loss associated with traditional diamond mining, as well as ease concerns about child labor and other human rights abuses in the global mining industry.
Jamie Kneen, program co-lead with the non-profit organization Miningwatch Canada, said lab-grown diamonds are a better choice for a number of environmental and social reasons — and added he believes they have the long-term potential to significantly disrupt the traditional mining industry.
“There are some energy use implications with the lab-grown diamonds, but it’s not at all on the same scale as digging a huge crater and crushing millions of tonnes of rock.”
As consumers increasingly look for alternatives to traditional diamonds, retailers are taking notice. For example, Pandora, the world’s largest jeweler, recently launched a new collection of lab-created diamond jewelry at its US and Canadian retail stores.
“The lab-grown (segment) is a very small fraction of the overall market. But the data shows it’s growing at double the pace of the mined diamonds,” said Luciano Rodembusch, Pandora’s North American president, in an interview.
“We believe that more and more — once you understand that there is no difference chemically, physically, or visually and the price is much more affordable — I think naturally we will start to see more and more migration.”
Pandora has also stated its intention to stop using mined diamonds entirely, a decision that suits younger consumers increasingly concerned about the environmental and human rights impact of traditional diamond mining.
Some consumers still see lab-grown diamonds as less special to their naturally occurring counterparts — perhaps not surprising considering another successful diamond industry campaign also managed to convince generations of lovers that an engagement ring should cost “two months’ salary.”
But the Crew, the Toronto newlyweds, doesn’t buy into the argument that the greater the spend, the bigger the love.
“Honestly, I think it’s a bit strange that anyone would think there’s a negative connotation to (lab-grown diamonds),” she said. “It just seems like a prudent financial and environmental and ethical decision to make. And the arguments against it don’t seem particularly logical or compelling to me.”
This report by The Canadian Press was first published Oct. 13, 2022.
Amanda Stephenson, The Canadian Press
Note to readers: This is a corrected story. An earlier version misspelled Luciano Rodbusch’s name.