Chinese consumers turning to lab-grown diamonds
October 8, 2019 Category China News Round-up, Weekly
Lab-grown diamonds, which have been used for industrial purposes for decades, are now shaking up the USD87 billion consumer market as cheaper alternatives to mined gem stones. Replicating the process of how mined diamonds are formed, labs today use two major processes to grow diamonds – high pressure/high temperature (HP/HT) and chemical vapor deposition (CVD). For years, lab-grown diamonds were commonly used in high-end manufacturing. “Yet with technological advancements, many labs are now able to create gem-quality diamonds at lower costs,” said Sun Lihua, Geologist at the Gem Appraisal Center of Peking University, China’s leading institute that offers diamond grading services. “Rapid technological improvements have allowed many Chinese labs to eliminate the presence of other elements that impact diamond quality, such as nitrogen molecules that make the stones look yellow and reduce their value,” Sun said.
The cost of growing lab diamonds has dropped by up to 90% in the past 10 years, according to business analysis website ifanr.com. Today, the cost of making a lab diamond is about 30% lower than that involved in mining a diamond of similar size and quality, said Li Zheng, Research Manager at market research provider Leadleo Research Institute. “Meanwhile, the time it takes to produce a 1-carat diamond is now five to eight days, much shorter than the time it takes to mine and polish a diamond. “Aside from the fact that lab-grown diamonds are created artificially, rather than mined, they are the same in terms of their physical and chemical characteristics,” said Tang Bin, Deputy Director of the Gem Appraisal Center of Peking University. Lab-grown diamonds are cheaper, better, and more accessible, making them a popular alternative to mined ones.
Although the consumer market for lab diamonds is only worth USD150 million, taking up about 2% of the consumer market for all diamonds, industry predictions show it is expected to grow at 22% each year and reach USD14.9 billion by 2035, taking up about 5% of the consumer market for all diamonds.
Lab-grown diamonds are becoming more popular in China. “With the post-1980 and post-1990 generations emerging as a major buying power, lab-grown diamonds used in jewelry will see an increasing presence,” Li of the Leadleo Institute said. More consumers born in the 80s, 90s, and even millennials, are turning to lab-grown diamonds as they are cheaper than mined gems of similar quality, and marketed as eco-friendly and ethically sourced. “Consumers from those generations are increasingly conscious of the environmental and ethical impact of their purchases, such as whether workers are fairly paid and the work is done in safe and environmentally friendly conditions. In China, where 90% of the world’s lab-grown diamonds are produced, diamonds grown for the consumer market take up 3% of the total diamond market, the China Daily reports.
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