Editor’s Note
This article highlights a significant market shift, detailing how changing consumer preferences in China are impacting the global diamond industry. The rise of lab-grown alternatives presents a notable challenge to traditional markets.
Changes in China are rapidly reshaping the global market, according to a December 22 article by the Hong Kong-based English-language media South China Morning Post. As Chinese consumers move away from natural diamonds, demand for diamonds has “fallen off a cliff,” with the entire industry feeling the impact. Meanwhile, China’s lab-grown diamond sector is rapidly developing and entering the global market. Some economists believe that the years-long decline in diamond prices, coupled with a growing perception that diamonds have lost their investment value, will only intensify this trend.
The article notes that natural diamond prices are falling globally. Chinese consumers are no longer splurging on natural diamonds, while much cheaper lab-grown synthetic diamonds are gaining popularity. A founder of a Shanghai diamond company stated that Tiffany jewelry is no longer a necessity for people.
According to data from Bank of America Global Research, global diamond wholesale prices have fallen by about 40% over the past two years. Since hitting a record high in 2022, the Zimnisky Global Rough Diamond Price Index has seen a particularly sharp decline.
Diamond industry analyst Paul Zimnisky stated that changes in the Chinese market have contributed to the price drop.
Independent Asia economist Rajiv Biswas noted that China’s diamond market, valued at $9 billion, is second only to the United States globally, but there is a growing perception that diamonds have lost their investment value.
Meanwhile, analysts say China is leading the way in mass-producing lab-grown diamonds, which sell for a fraction of the cost of natural stones.
Bloomberg earlier cited the latest report from U.S. market research firm Tenoris, pointing out that U.S. finished jewelry retail sales grew 9.9% in October 2024, with natural diamond jewelry rising slightly by 4.7%, while lab-grown diamonds achieved a staggering 46% growth. According to forecasts from the German data platform Statista, sales of lab-grown diamonds in the global jewelry market will reach about $18 billion in 2024, accounting for over 20% of the entire jewelry market.
Over the past decade, Henan Province in central China has become the “global production center” for lab-made diamonds.
Public data shows that China’s monocrystalline diamond output accounts for about 95% of the global total, firmly ranking first in the world, with Henan producing 80% of China’s synthetic diamonds. In the field of lab-grown diamonds, China’s production capacity accounts for about 50% of the global total, with 80% of that coming from Henan.
Zimnisky said the first lab-made diamonds began entering the global market about a decade ago, and their popularity has soared since then. He stated that synthetic products now account for 15% to 20% of global diamond jewelry demand, compared to just 1% in 2015. Data from the renowned industry intelligence agency Research and Markets shows the global synthetic diamond market size reached $15.3 billion in 2023.
A Hong Kong diamond sales consultant said Chinese newlyweds still prefer natural diamonds, but the market prospects for lab-grown diamonds in China are bright.
Industry insiders analyze that with the gradual recovery of the macroeconomy and the further spread of the “self-pleasure” consumption concept, downstream diamond consumption demand is expected to gradually recover. As lab-grown diamonds have the same composition and structure as natural diamonds but a significant price advantage, coupled with consumer education by media and brands in recent years, the penetration rate of lab-grown diamonds is expected to increase further in the future.
Earlier this year, Yu Jing, a 30-year-old architecture professional living in Shanghai, bought a pair of earrings decorated with lab-grown diamonds.