【Global / Asi】The Rise and Fall of ‘Laboratory Gemstones’: Lab-Grown Diamonds

According to Fortune Business Insights, the global lab-grown diamond market size reached approximately $25.89 billion last year and is projected to grow to $74.45 billion by 2032, with an average annual growth rate of 14.11%. The Asia-Pacific region, with a 33.17% market share as of 2023, is leading the lab-grown diamond market.

Lab-grown diamonds have rapidly replaced natural diamonds in the wedding market. According to the wedding website The Knot, in 2024, 52% of married American couples chose lab-grown diamond engagement rings, surpassing natural diamond engagement rings for the first time in history. In 2023, the price of natural diamond rough stones fell by 40%. Morgan Stanley predicted that “over 20% of the precious metals market this year will be replaced by lab-grown diamonds.”

The rapid growth of the lab-grown diamond market is largely due to two factors: price affordability and ethical production methods. Lab-grown diamonds can be produced in flawless conditions and are 30-70% cheaper than natural diamonds. With advancements in production technology, their quality has improved to the point where they are difficult to distinguish from natural diamonds with the naked eye.

The production method also appeals to the MZ generation, who value ethical consumption. Natural diamonds are mined in environments involving inhumane labor exploitation, such as in Africa. Diamonds produced through forced child labor in Russian mines have been used as war funds, earning them the stigma of “blood diamonds.”

In contrast, lab-grown diamonds are optically, physically, and chemically identical to natural diamonds but are grown over approximately 6-10 weeks in safe laboratories. They are typically produced using processes like High-Pressure High-Temperature (HPHT) or Chemical Vapor Deposition (CVD). Using renewable energy in this process makes them an even more “virtuous” diamond.

Companies have also strengthened their lab-grown diamond lines in response to MZ consumer demand. In 2021, the world’s largest jewelry company, Pandora, announced it would stop selling natural diamonds and sell only lab-grown diamonds. High-end jewelry brand De Beers and luxury brand Prada have also launched lab-grown diamond products. LVMH invested $90 million in the Israeli lab-grown diamond company Lusix in 2022.

Many young celebrities have also chosen lab-grown diamonds. Actress Rooney Mara, born in 1985 and starring in ‘The Girl with the Dragon Tattoo,’ chose a lab-grown diamond for her engagement ring when she became engaged to actor Joaquin Phoenix in 2019. British Princess Meghan Markle is also known as a fan of lab-grown diamonds.

However, recent opinions suggest that the growth of lab-grown diamonds may be a bubble. The signal was the world’s leading diamond company, De Beers, formalizing its exit from the lab-grown diamond business in May of this year.

According to the latest report from Reuters, the price of lab-grown diamonds continues to fall due to increased production in China and India. The production cost of lab-grown diamonds is said to have dropped by over 20% annually.