Lab-Grown Diamonds: Prices So Low They’re Putting Brands in Crisis

Their prices have fallen enough to drag the entire market down with them.

When lab-grown diamonds first appeared on the market, gaining prominence after Frank Ocean launched his own jewelry brand, it almost seemed they would disrupt the industry. At that time, there was much talk about sustainability and a growing belief that alternatives to certain products or materials would be accepted by the market. It was said that diamond mining was a very dirty business, that the preciousness of diamonds themselves was a marketing myth, and that lab-produced diamonds were in no way inferior to real ones – clearly, that was not the case. Between increasingly unstable demand for diamonds, a depreciation of natural stones, and sustainability concerns (as lab-grown diamonds are produced using significant electricity), the market destabilization has plunged one of the sector’s iconic producers, De Beers, into crisis. Its sales have plummeted, prices have been cut, and last year, it was also unofficially “put up for sale” by its parent group, Anglo American.

Today, it is precisely De Beers Group that announced the closure of its synthetic diamond jewelry brand, Lightbox. This is not only because the prices of lab-created diamonds have collapsed, along with profit margins, but also because sales of synthetic diamonds have surpassed those of natural ones. But what happened?

According to Al Cook, CEO of De Beers Group, market dynamics have changed radically since the launch of Lightbox, whose synthetic diamonds cost $800 per carat. Since then, however, wholesale prices for synthetic diamonds have plummeted by 90%, largely due to mass production from countries like China and India and reduced manufacturing costs thanks to technological advancements.

The situation is serious because, as revealed in the same cited article, De Beers has two billion unsold diamonds – a result of a crisis that may have macroeconomic and geopolitical roots, such as the embargo on Russian diamonds or taxes in the United States, but certainly has social ramifications, like the decline in marriages worldwide.

Now, De Beers is preparing for a narrative change: first, it has produced the DiamondProof device capable of authenticating gems and has also announced huge investments and global campaigns aimed at reaffirming the uniqueness of real diamonds. One might say, since we’re talking about Walmart, that these cheap artificial diamonds correspond to the Hermès Birkin dupe for which the supermarket chain became famous some time ago: market forces have simply decreed that artificial diamonds are a kind of dupe, and the entire market value has been diluted.

The closure of Lightbox, almost comparable to shutting down a diffusion line in fashion, also reflects a broader strategic repositioning of De Beers, which, let’s remember, is the world’s third-largest producer of rough diamonds. It seems that in 2025 the diamond group will effectively be sold, and so the company has already worked on a plan called the “Origins Strategy” presented in 2024, aiming to optimize operations and concentrate investments in high-margin segments related to natural diamonds. In short, nothing beats the core business – provided the core business can recover from the damage inflicted by this dupe market.

Just consider, as the NY Times explains, that in 2018, the price difference between lab-grown and natural diamonds was barely 10%, whereas today, synthetic stones can cost from one-twentieth to one-quarter the price of a similar natural diamond. The low-end sellers are the ones who have reaped the rewards: Walmart, for example, began selling jewelry with synthetic diamonds in 2022 and recorded a 175% increase in sales in 2024 compared to the previous year. In the same article, it is noted that in a 2024 survey conducted by the American wedding platform The Knot, it emerged that 54% of respondents chose synthetic diamonds for their engagement rings: they were 46% in 2023 and 12% in 2019.