The Diamond Industry Is Withering as Beautiful Lab-Grown Diamonds Drive Down Prices

"The diamond industry is in trouble."

Not Forever

Lab-grown diamonds are taking the jewelry industry by storm — and those invested in the natural-grown kind are none too pleased.

As CNBC reports, consumers have developed a taste for less-expensive lab-grown diamonds, which are identical to those forged within the Earth's pressurized mantle but only take a few hours to make, rather than a few billion years.

Said to be up to 85 percent cheaper than mined diamonds, lab-grown diamonds have seen a huge jump in demand as frugal consumers seek to save money and — let's be honest — patronize sellers who don't have blood on their hands.

According to data provided to CNBC by diamond industry analyst Paul Zimnisky, lab-grown represented more than 18 percent of the diamonds sold in 2023, up from just two percent in 2017. Overall diamond prices, meanwhile, have fallen 5.7 percent this year alone, the analyst said.

This sea change has made major waves in the diamond industry, as evidenced by the current debacle at De Beers, the company that in 1948 coined the slogan "diamonds are forever." After seeing major revenue losses in the hundreds of millions of dollars, De Beers is now in a tense breakup with its majority shareholder, the mining company Anglo American — and is recommitting itself to mined diamonds in the midst of it all.

Crazy Diamond

While the drama at the diamond industry's most prestigious institutions rages on, smaller companies are left dealing with the fallout.

Take it from Ankur Daga, the CEO and founder of the e-commerce jeweler Angara who pointed to analysis suggesting that half of engagement rings bought this year will feature lab-grown diamonds. That figure, as a survey commissioned by The Knot wedding magazine found, is almost quadruple the 12 percent who said they'd be buying lab-grown in 2019.

"The diamond industry is in trouble," said Daga, with the "core issue" at hand being the "rapid growth of lab-grown diamonds."

Anish Aggarwal, the cofounder of the diamond advisory firm Gemdex, told CNBC that he believes the industry is up to the challenge — and that its own short-sightedness is likely the cause for its current crisis, anyway.

"The industry has not done large-scale... marketing for almost 20 years," Aggarwal noted. "And we’re seeing the aftermath of that."

To recapture the public's infatuation with diamonds, the industry clearly needs to get on board with the times — and, perhaps, take the L when it comes to consumers wanting to save on luxury goods during an ongoing global recession.

More on luxury: Orcas Strike Again, Sinking Yacht as Oil Tanker Called for Rescue