Editor’s Note
The rise of lab-grown diamonds, now produced in a week versus nature’s billion-year process, is reshaping the jewelry industry. As technology slashes costs, this synthetic alternative presents a profound challenge to the traditional diamond market.
The Earth takes over a billion years to produce a natural diamond, while synthetic diamonds can be created in just one week.
According to Marty Hurwitz, head of the Synthetic Diamond Trade Organization, the emergence of these lab-grown diamonds is causing significant upheaval in the traditional industry.
Synthetic diamonds appeared on the jewelry market over a decade ago, but recent technological advances have significantly reduced their production costs.
Currently, a lab-grown 3-carat diamond costs only 7% of the price of a comparably sized, naturally mined diamond. Data from Tenoris shows that lab-grown diamonds now account for 17% of the US retail market – a sharp increase from just 3% in 2020.
commented Ben Davis, an analyst at RBC.
More than 70% of the world’s lab-grown diamonds used in jewelry come from China, with Henan being the center of this industry.
China’s turn to diamond production stemmed not from demand for jewelry, but from geopolitical factors, as the Soviet Union halted its supply of industrial diamonds in the early 1960s.
In the 1980s, Henan developed into a center for industrial diamond production. It was only in the last decade that Chinese companies shifted their focus to the jewelry business, which offers higher profit margins.
Today, most synthetic diamonds in China are produced using the High-Pressure High-Temperature (HPHT) method, and an increasing number of manufacturers are using the Chemical Vapor Deposition (CVD) method for larger gemstones.
After initial processing, they are transported to Surat, India for polishing, before reaching trading hubs like Antwerp or Dubai and finally reaching consumers.
However, few consumers are aware of China’s central role, as customs regulations typically indicate the country of origin where the diamond was cut.
China’s diamond industry is also of strategic importance due to its use in military and defense goods. Norinco, China’s state-owned arms manufacturer, even operates a lab-grown diamond business and sells them under its own jewelry brand.
In 2018, De Beers, the natural diamond giant, founded Lightbox Jewelry, a lab-grown diamond company, to create a market niche and preserve the luxury status of expensive natural diamonds. However, this move triggered a price war that depressed natural diamond prices.
By the end of 2024, De Beers’ diamond inventory had reached a value of $2 billion – the highest inventory since the 2008 financial crisis.
The price of lab-grown diamonds has fallen dramatically. In 2020, a 3-carat diamond still cost around $28,900 at retail. By the second quarter of 2025, this price had dropped to just $3,900 – only one-eighth of its previous value. As Chinese companies improved their technology and lowered retail prices, Lightbox lost its competitive advantage and ceased operations this year.
In Henan, the Chinese provincial government had to intervene and establish a new diamond association to curb the price war – similar to the electric vehicle industry. One of the association’s first measures was to set a minimum price of $15 per carat for rough diamonds.
David Kellie, CEO of the Natural Diamond Council, acknowledged the challenge from lab-grown diamonds but argued that the main reason for the price decline was the supply-demand imbalance resulting from the pandemic.
he said.
The emergence of lab-grown diamonds has had a positive side effect: the democratization of diamonds. Ankur Daga, co-founder of the online jewelry company Angara, expressed surprise at their popularity:
Given the sharp rise in gold prices, the cost composition of engagement rings has changed. For many buyers of lab-grown diamonds today, the most expensive component is no longer the stone itself, but the gold setting. This shows that lab-grown diamonds are not only changing the market but also reshaping the definition of luxury and value in jewelry.
