Lab-Grown Diamonds: Bubble Burst or Temporary Glitch?

Lab-grown diamonds are facing declining appeal due to oversupply and shifting consumer preferences back to natural stones, says World Diamond Council President Feriel Zerouki. Lab-grown diamond prices have plummeted due to increased production, undermining consumer confidence. Initiatives like the Luanda Accord aim to bolster natural diamond demand.

Lab-grown diamonds are reportedly losing their sheen amidst an oversupply in the market, leading to a consumer shift back toward natural stones, according to World Diamond Council President Feriel Zerouki.

Since mid-2022, the natural diamond industry has suffered a price slump, primarily due to the rising popularity of lab-grown gems. However, a significant drop in synthetic diamond prices, thanks to increased production from China and India, is eroding consumer confidence, Zerouki told Reuters during a mining conference in Luanda.

With a 96% fall in the average wholesale price of one-carat and two-carat lab-grown diamonds since 2018, industry experts are sounding the alarm. They warn these diamonds may soon be relegated to fashion accessory status, losing their competitive edge, particularly in the bridal market. Zerouki emphasized the need for collaborative marketing initiatives, citing the Luanda Accord as a key step, where diamond-producing countries have agreed to allocate funds to promote natural stones.

(With inputs from agencies.)