The Natural Diamond Council (NDC) recently revealed its latest report titled ‘Diamond Facts: Busting Myths About the Diamond Industry’ addressing commonly held beliefs and misconceptions about the diamond industry for more informed buying decisions. Quality, source and price emerged to be key considerations actively shaping the narrative for these much-loved jewels globally. As natural diamonds become an investment choice with significant returns, here’s what buyers need to know:
Rethinking sustainability: Contrary to popular belief, not all lab grown diamonds are sustainable. The manufacturing process for lab grown diamonds, which spans a few weeks, is alarmingly energy-intensive, requiring temperatures akin to 20% of the sun’s surface. The process, especially in the case of a principle technique known as Chemical Vapour Deposition (CVD), is significantly energy-consuming, largely due to the use of plasma microwaves, which demand substantial power. Additionally, over 60% of the world’s laboratory-grown diamonds are mass-produced in China and India where 63% and 74% of grid electricity is generated from coal, raising questions about the ‘eco-friendly’ claims by most manufacturers. Ethical sourcing remains a top priority for the natural diamond industry, as it actively works towards decarbonizing and protecting biodiversity.
Understanding pricing: Diamond formation takes place over millions, sometimes billions, of years in limited zones on Earth, which makes natural diamonds extremely rare and truly a prized possession. Long-time diamond analyst Edahn Golan recently said in an interview that lab-grown diamonds did not have the characteristics of luxury - they are not limited, high priced and neither do they have a story of their own.
Analyst Paul Zimnisky and a three decade-long study by Bain and Company reveal an illuminating trend - the price of laboratory-grown diamonds have plummeted by over 74% in the past six years, while natural diamond prices, though fluctuating at times, have over the long term exhibited a consistent annual increase of 3%. In 2016, a 1.5 carat laboratory-grown diamond cost $10,600 and in early 2023, it decreased to $2,445. According to Ziminisky, most lab-diamonds might be sold as fashion or semi-precious jewellery in the coming years, while natural diamonds will ultimately increase in terms of long-term value.
The global natural diamond recovery peaked in 2005 and has decreased by over 30% in the last 16 years. The annual recovery of one carat diamond can fill just one exercise ball. While lab-grown diamond prices have significantly depreciated, their supply is unlimited. On the other hand, increasingly rare natural diamonds have demonstrated stable growth over the years, providing sustained value over time.
Detecting quality: Professional verification instruments make it possible for lab grown diamonds to be differentiated easily from natural diamonds. Any retailer or jeweller selling laboratory-grown diamonds is legally required to disclose it as man-made with all the relevant grading reports and certifications.
With 100% resale value on diamonds being announced in the UAE recently, more consumers are expected to buy diamonds from across different age groups. To sustain greater transparency across supply chains in future, investments in traceability initiatives are further expected to accelerate quality measures within the natural diamond industry, providing higher value for consumers.
Tawhid Abdullah, CEO of Jawhara Jewellery & Chairman of the Dubai Gold & Jewellery Group (DGJG) stated, “At Jawhara, we firmly believe in the unparalleled allure and enduring significance of natural diamonds. And so we have partnered with Natural Diamond Council (NDC), an organization that shares our commitment towards promoting these wonders of nature. We support the Diamond Facts report released by NDC, as it is helping create transparency and dispel common myths in the industry. Our common goal is to empower the consumer in the GCC to make informed choices when it comes to purchasing natural diamond jewelry.”
Nishith Shah, CEO of La Marquise Jewellery added, “La Marquise jewelry was created for the young, informed ‘glocal’ consumer and to fulfill their desire for exquisite, exclusive natural diamond jewelry. As a brand, we have collaborated with the Natural Diamond Council as we both believe in the significance and beauty of these precious gems. We are very happy to promote the NDC’s Diamond Facts report as it dispels misconceptions and offers real, fact-based information to the GCC consumer on both natural diamonds and lab-grown diamonds, leading them to making an educated choice.”
Richa Singh, Managing Director - India & Middle East, Natural Diamond Council said, “Today’s consumer is making conscious, mindful choices, and are looking for reliable, trust-worthy and transparent information. At Natural Diamond Council, one of our key missions is to inspire, educate and protect consumers from misinformation. The ‘Diamond Facts’ was launched with the objective of busting myths and clarifying misconceptions about diamonds, and advancing the integrity of the modern diamond industry. We are happy about the positive response we have received in the GCC region and will continue to work towards building the diamond dream here, and across the world.”
The Natural Diamond Council's comprehensive report is based on extensive research conducted by renowned third-party organizations and industry experts. The report also highlights initiatives, such as De Beers Group's collaboration with Kelp Blue to explore their carbon-storing potential, demonstrating diamonds' positive impact on the environment. To explore the full analysis and dispel common myths about diamonds, visit: https://www.naturaldiamonds.com/ae/diamond-guide-ae/diamond-facts/
