Editor’s Note
The natural diamond industry faces significant disruption from the rise of lab-grown alternatives, a shift that leading figures like De Beers CEO Al Cook are calling a profound challenge to the traditional market.
Al Cook, the CEO of De Beers, the iconic jewelry house specializing in diamonds, is sounding the alarm: the natural diamond market is experiencing a serious crisis, and the primary cause is believed to be the exponential development of the lab-grown diamond market.
Lab-grown gems are created using methods that can artificially generate the temperatures and degree of pressure necessary in nature to create diamonds, but at an estimated price 20 to 50% lower than that of natural stones.
In 10 years, lab-grown diamonds have invaded stores and won over buyers thanks to their prices and “ethical” guarantees. The status of the diamond as it was once displayed – a timeless luxury asset – is being strongly called into question.
The latest figures confirm the severity of the situation: the giant De Beers accumulated $2 billion in unsold stock in 2024 and the company was forced to announce the elimination of more than 1000 jobs at Debswana in Botswana.
The situation of other major companies in the sector is also fragile. Alrosa, the Russian mining giant, is suffering from the diamond crisis linked to international sanctions stemming from the conflict in Ukraine. The company has thus lost 77% of its profits and several mines have been closed since 2022.
In Australia, Lucapa was placed under sequestration in 2023, while in Sierra Leone, Koidu Limited closed its doors and laid off more than 1000 employees following strikes that resulted in losses of $16 million in 2022.
Currently, lab-grown diamonds represent 20% of global diamond jewelry sales, whereas ten years ago, synthetic gems accounted for only 1% of the market. According to a study conducted by the American wedding industry site “The Knot”, more than 50% of engagement rings sold in the United States in 2024 contained lab-grown diamonds.
For economies heavily dependent on the sector, such as those of Botswana (90% of the country’s revenue), Canada, Namibia, Angola, and Russia, the risks are high. Other factors, beyond the competition from lab-grown diamonds, are further weakening the natural diamond market: on the one hand, the luxury crisis in China, and on the other hand American customs duties imposed on exports of goods to the United States.
In an attempt to revive, De Beers recently closed its lab-grown diamond jewelry brand, Lightbox, to refocus on natural diamonds. The company now aims to renew and strengthen the sector’s marketing to revalue the assets of natural gems.
It is worth noting that in Africa, the main diamond producers, meeting in Luanda on Wednesday, June 18, signed a “historic” agreement to stimulate global demand. For the first time, Botswana, South Africa, Namibia, the DRC, and Angola want to allocate 1% of annual rough diamond sales revenue to fund an international advertising campaign in favor of natural diamonds (source Agence Ecofin).
