The worth of a lab-grown diamond will be 5 instances cheaper than a pure diamond, however they’re each chemically equivalent.

According to Limelight Diamonds, certainly one of India’s largest LGD jewellery manufacturers, a pure diamond is priced at round $6,000 per carat whereas its LGD counterpart is simply $1,200.

Both are additionally graded based mostly on the 4Cs — readability, shade, lower and carat — the broadly accepted customary traits to find out a diamond’s worth and high quality.

Sales of LGDs have skyrocketed as patrons in India who had been beforehand unable to buy diamonds on account of their excessive value now really feel they will enter the market. 

“Previously, less than 5% of Indian women were able to afford natural diamonds,” mentioned Pooja Sheth, founder and managing director of Limelight Lab Grown Diamonds.

“But consumers are feeling it’s more value for money to purchase a lab grown diamond and there is a huge amount of incremental demand from new purchases who have never bought a diamond before,” she commented.

India is at the moment the second-largest lab-grown diamond producer, behind China which accounts for not less than half the world’s manufacturing.

Edahn Golan, the CEO of Edahn Golan Diamond Research and Data, mentioned he is optimistic the South Asian nation might quickly be No. 1.

China’s LGD market is greater when it comes to manufacturing, however it isn’t sharpening as many gems as India, Golan defined. “The technology that is used in India is far more sophisticated, and has much more room for improvement over time in the future,” he advised CNBC in a cellphone interview.

“China can make more diamonds with the technology they are using, but India can make more, and make them better.”

Limelight Diamonds has bought 10,000 carats value of LGD jewellery from April 2022 to March this 12 months, in accordance with the corporate. Sheth claimed the corporate has already seen practically twice as a lot gross sales from simply April to September this 12 months.

However, Sheth identified that many patrons aren’t essentially spending much less when shopping for LGDs.

“Lab grown diamonds have provided a purchasing upgrade. Even though prices are cheaper, many are not reducing their budgets,” she mentioned.

“They are either upgrading themselves with a bigger rock, or buying a pendant and [a pair of] earrings with that.” 

Much of the optimism surrounding LGDs in India will be attributed to Prime Minister Narendra Modi’s state go to to the White House in June when he gifted First Lady Jill Biden a 7.5 carat gem that was made within the South Asian nation.

“The perception towards lab grown diamonds suddenly changed and that really altered the growth of lab grown diamond acceptance in the country,” Sheth mentioned.

“It’s about opening up an entire segment of Indian audiences that have not been able to purchase diamonds before.”

Despite a lot optimism, LGD patrons nonetheless view the jewel as an entry level to the diamond market and can most certainly buy pure diamonds after they have a extra buying energy in future, analysts advised CNBC.

“Lab-grown diamonds are now the talk of the day. But If you have enough money floating around, you’ll essentially buy a naturally mined diamond,” mentioned Tehmasp Printer, CEO of the International Gemological Institute.  

“Millennials and Gen Zs may opt for a LGD when they want to get married, but switch to a naturally mined diamond down the road,” Printer advised CNBC.

“If you have a Toyota, you’ll want to buy a lower end BMW after before you finally get a [Mercedes-Benz] S-Class. It’s a question of upgrade.” 

Paul Zimnisky, CEO of Paul Zimnisky Diamond Analytics, agreed.

The progress of the LGD market won’t make a marginal shift on pure diamond gross sales, Zimnisky mentioned.

“Man-made diamonds represent around 20% of the total industry in the value sold. It was basically zero 10 years ago, so it has been growing rapidly on a relative basis,” he mentioned.

“But it would be incorrect to say that that’s the reason why the diamond price is softer this year. It’s mostly a return to normalization.”

Zimnisky highlighted that spending on jewellery elevated when Covid restrictions had been lifted globally, pushing diamond costs to their peak in February 2022. 

Prices have come down by 25% since then, in accordance with Zimnisky’s Global Rough Diamond Index.

Data from the analytics agency predicted that demand for international diamond jewellery will fall to $81 billion this 12 months from $89 billion in 2023, which remains to be larger than $75 billion in 2019, earlier than the pandemic hit.

However, Zimnisky cautioned that bother may very well be not far away for LGDs if costs for the gem proceed to fall too due to how quickly they’re being produced.

“I think the price of retail isn’t reflective of how low the raw material prices are and the retail price for the man-made diamond will continue to go lower … that’s the risk for the lab diamond industry,” he warned, predicting {that a} three-carat LGD solitaire ring will quickly promote “well under $1,000.”