Lab-Grown Diamonds Not as Sustainable as thought, Investment Value in Question

: Over the past eight years, the diamond landscape has witnessed significant shifts. Laboratory-grown diamond (LGD) prices have witnessed a dramatic nosedive, jeopardising their long-term investment potential. In 2016, a 1-carat synthetic diamond was priced roughly 10% lower than its natural counterpart. However, by the close of 2022, the price differential had dramatically expanded to as much as 80%, depending on the manufacturer.

The growing price divide is further undermined by the largely unsubstantiated sustainability claims of lab-grown diamonds. Additionally, over 60% of the world’s laboratory- grown diamonds are mass-produced in China and India where 63% and 74% of grid electricity is generated from coal, raising questions about the ‘eco-friendly’ claims by most manufacturers. 

Analyst Paul Zimnisky and a three decade-long study by Bain and Company reveal an illuminating trend  the costs of laboratory-grown diamonds have plummeted by over 74% in the past six years, while natural diamond prices, though fluctuating at times, have over the long term exhibited a consistent annual increase of 3%. 

Richa Singh, Managing Director, NDC India and Middle East,  states, "Amidst the shifting dynamics, one thing remains crystal clear: natural diamonds possess an enduring value and timeless elegance that make them the right choice for the conscious and investment-minded consumer. Their inherent rarity, sparkling beauty, and emotional significance mean they are the only luxury products that can be worn every day and enjoyed, and yet appreciate in value over time."