Editor’s Note
This article examines the shifting landscape of the diamond industry, where a combination of economic pressures and the rise of lab-grown alternatives is significantly impacting the market for natural stones.
The demand for naturally produced diamonds has decreased. This is because diamonds can now be produced in the laboratory – and consumers have become more frugal.
Diamond prices have fallen significantly over the past three years. One carat of natural diamond now costs around one-fifth less than in May 2022, when prices reached record highs.
While the prices of consumer goods continue to rise due to inflation, diamond prices are moving in the opposite direction. This has much to do with the coronavirus pandemic.
Simultaneously, demand from China, the second-largest market for diamonds, declined sharply due to the pandemic-related crisis. The price fell as sharply as it had risen.
However, the coronavirus pandemic is not the only reason for the diminished diamond fever. The precious stones, whose mining and processing are very labor-intensive, have faced strong competition from synthetic diamonds. These can be produced significantly more cheaply in the laboratory.