Machine-made bling is cheaper and more ethical than mining but is it the future?
Man-made gems aren’t just shaking up the world of fine jewellery; they’re challenging perceptions of what it actually can be.
A diamond may be forever, or a girl’s best friend, but they might not be exactly as you first thought.
The burgeoning lab-grown diamond industry, projected by Allied Market Research to reach US$55.6 billion by 2031, remains a sliver of the entire diamond industry but it’s fuelling the debate on how consumers think about sustainability, value, luxury and all that sparkles.
A lab-grown diamond can cost up to 70 per cent less than a mined diamond. They can be grown in a few weeks by compressing carbon at super high temperatures and pressures in a machine, rather than waiting for nature to complete the same process in somewhere between 800 million and three billion years. Proponents claim lab-grown diamonds are a more ethical and sustainable choice than some natural ones, whose origins can be murky.
Daniel Bracken, chief executive of diamond-focused New Zealand brand Michael Hill, says sustainability is important to its customers. However, as he points out, not all lab-grown diamonds are made equally.
“I honestly believe that the growth is being fuelled by, for sure, a younger customer, [and] a customer that actually cares where the product came from and how it came to be. I think a lot of customers think all lab-grown diamonds are sustainable and all lab-grown diamonds are carbon neutral because there’s this notion that they’re created by man and therefore they should be. The reality is they’re not. We are the only leading retailer in Australia and New Zealand that has fully sustainable carbon-neutral lab-grown diamonds. And customers say to us, ‘That’s why we are buying them from you’,” Bracken explains.
Michael Hill, which has 147 stores in Australia, will soon launch new additions to its lab-grown collections, including tennis bracelets and trend-driven pieces that move the category beyond bridal for the retailer. In the brand’s new purpose-built workshop and HQ in Brisbane, the mined diamond and lab-grown diamond workshops are kept separate.
Re-thinking how lab-grown diamonds can be used was important for Australian friends Jeramie Hotz and Talia Shuvalov, who this month launch a new fine jewellery brand called Erede, an Italian word that means to inherit or to pass down.
The business partners, based between Sydney and New York, believe lab-grown diamonds are a new way to unpick ideas about what fine jewellery can be.
The first collection is titled Scala, which means stairs in Italian and takes inspiration from the pair’s shared obsession with vintage images of escalators and steps, industrial elements, modernist art and a sense of movement. Pieces are crafted from recycled and ethically sourced 18-carat gold and lab-grown diamonds while the cuts of the stones and gem settings – only bezel or inverted bezel-set stones – add to their sense of volume. But of course, it’s the stones used that shake up perceptions of craftsmanship and pieces to treasure.
“We were both very interested in the lab-grown diamond industry for many reasons,” says Shuvalov. “The obvious ones being the ethical reasons, but I think just the notions around lab-grown diamonds and how people consider them. I think a lot of the industry is focused on lab-grown for engagement rings or just because they’re a cheaper, bigger option. We were really interested in using them because they really feel like a real solution to creating fine jewellery in a modern way that isn’t ethically unsustainable.”
Not that it was all smooth sailing. The pair initially struggled to find a jeweller in New York’s famed diamond district, where their pieces are made, willing to work with lab-grown diamonds. The main issue being, it is virtually impossible to tell the difference between a lab-grown and a mined diamond unless using expert technology, so working with both poses a risk of mixing the two.“It was very, very hard to find people who would say yes. And also a lot of the people that we wanted to work with said, ‘We don’t work with lab’,” says Hotz.
“They were actually worried about having our stock of diamonds and getting it mixed because … they can’t tell unless it’s tested. So it’s controversial for them.”
As Hotz notes, the chemical makeup of a natural and lab-grown diamond are the same, with only a small inscription at the base of a lab-grown diamond to differentiate them. But the price, and perception, remains vastly different. Both Hotz, who is the studio director for industrial design and creative concepts firm Caon (owned by her husband David Caon) and has a background in fashion production, and Shuvalov, who has spent years in New York as a knitwear designer and design director at the likes of Narciso Rodriguez and Alexander Wang, are life-long jewellery obsessives.
They share a similar taste for bold, strong design and a well-honed eye for vintage treasures. Indeed the original plan was to launch the brand with a curated vintage edit of jewellery sourced by the pair during their travels. These vintage pieces will still be part of the offering alongside the new pieces, and reflect the attachment both have to jewellery and the belief it should be treasured, worn, passed down.
“We’ve always really connected on our taste and jewellery. Both of us have a lot of hand-me-down pieces from our parents or grandparents and so many sentimental stories that we would talk about around that … But also our aesthetics were really aligned in what we liked; not your everyday sort of dainty [jewellery],” says Shuvalov.
“A bit more robust, modernist. There’s not a lot of dainty pieces in there, but they’re still very elegant and timeless,” says Hotz.
“It really felt like it was important for us to work in a way that felt different to what anyone else had done. And I felt that both being ethical and finding a way into the market that wasn’t what was already out there. I think lab-grown really answered that for us”The use of lab-grown diamonds in fine jewellery is one such example of what Luca Solca, senior research analyst, global luxury goods at Bernstein, says we can expect to see, with expansion into new categories as the technology evolves.
“I think we will see more developments on the lab-grown diamond front. Consumers are increasingly keen to protect the environment, and diamond mining has a huge environmental footprint,” he says. “Like in the case of alternative leather, I see a market space opening up for alternative raw materials across different product categories.”
Indeed, much of the growth of lab-grown diamonds until now has been driven by the bridal industry. Different statistics abound, but a recent survey of nearly 12,000 US couples by wedding website The Knot found more than a third had purchased an engagement ring with a lab-grown centre diamond, double the number from 2020.
Paul Zimnisky, a US-based independent diamond industry analyst, believes the increased demand for lab-grown diamonds will continue, but also recalibrate and re-set as technology advances. It’s a stance recognised in a recent report from Bain & Company in conjunction with the Antwerp Diamond Centre that found the increase in production of lab-grown diamonds has resulted in a decrease in their wholesale price — down to 14 per cent of the price of a natural diamond. “I expect the supply and demand for man-made diamonds to continue to grow into the medium term. That said, I expect prices of man-made diamonds to continue to trend lower as more efficient manufacturing and increases in supply make them even more affordable,” says Zimnisky. “As the man-made diamond ‘product’ matures, I expect it to compete less and less with natural diamond as most will be sold at a much different price point and consumers will likely consider it to be more of a semi-precious item.”
Still, some luxury brands are buying in. Watch brands TAG Heuer and Breitling are among the first to dabble in the space. TAG Heuer uses lab-grown stones for its high-end Plasma watch and Breitling plans to phase out mined diamonds on its timepieces by the end of 2024. Diamond giant De Beers also has its own lab-grown arm, Lightbox. But not all luxury brands plan on using lab-grown diamonds. Alexandre Arnault, executive vice-president of products and communication at Tiffany & Co., which has full traceability of its diamonds, recently told students at Oxford University that the blue-chip jeweller would not go into lab-grown diamonds, an assertion repeated by chief executive Anthony Ledru in his interview with WISH on page 36. “We believe in natural diamonds,” Arnault reinforced. “Would you rather own something that has been part of the planet forever, or that has been [made] in a microwave somewhere?”
The diamonds may look the same, and like mined diamonds, are also graded and certified (IGI for lab-grown versus GIA for natural), but as Michael Hill chief executive Daniel Bracken noted, they’re not a one size fits all. Questions around the sustainability claims of lab-grown diamonds, which were first created by General Electric in the 1950s, have been duly cross-examined. Lab-grown diamonds might not cause environmental and groundwater damage via mining, but they still require energy and chemicals to be created.
Relatively new certifications such as the SCS-007, which Michael Hill has attained, acknowledge sustainable and ethical practice in diamonds (natural and lab-grown versions) and are a way suppliers and jewellers can be more transparent. Meanwhile, new processes for making diamonds are coming to the fore. Leading lab-grown jewellers such as Vrai – which has investment from actor Leonardo DiCaprio – creates its stones in a zero-emission foundry using hydropower from the Columbia River in the US Pacific Northwest. In 2022 the LVMH Luxury Venture arm invested in Israeli-based lab-grown company Lusix, which uses solar power, while Skydiamond in the UK takes excess carbon from the atmosphere and rainwater to create its diamonds.
Moi Moi, founded by Lauren Chang Sommer and her sister Alana Chang Weirick in 2019, was the first to market premium lab-grown diamonds in Australia and now has a store in Sydney’s Queen Victoria Building and on Collins Street in Melbourne. The brand works only with labs using solar power or renewable energy certification and Chang Sommer says Moi Moi’s sales have tripled in the past three years. “We see customers across all demographics and age groups, with millennials being a substantial proportion,” says Chang Sommer. “Thanks to social media and online education, more people are aware that lab-grown diamonds are identical to mined diamonds and graded the same way. A lot of people are looking for ethical and attainable luxury that has minimal impact on the environment.”
That said, demand for natural diamonds is also growing. According to De Beers’ Diamond Insight Report 2022, the global demand for natural diamond jewellery increased 10 per cent in 2022 compared with pre-pandemic figures in 2019.
Irene Deutsch, managing director and owner of Australia’s oldest jewellery house, Fairfax & Roberts, says they are receiving requests for designs made with lab-grown diamonds. “I’m definitely watching it with keen interest. Our customer base is quite a traditional, high-net-worth customer base. They haven’t shifted as yet. They’re still interested in natural diamonds. But you know, a portion of our customer base is young people getting married and buying engagement rings. And if their focus is turning to [lab-grown] of course we’ll make them,” she says.
One of Deutsch’s concerns around lab-grown diamonds is that it’s still a relatively new area, with little regulation. She cautions people to buy from trusted sources and choose diamonds with a grading certificate. Too little is known about the secondary market, Deutsch says, and what a lab-grown diamond would be “worth”.
She mentions her mixed feelings about a “gorgeous” 2.0-carat lab-grown diamond ring the jeweller has in the boutique right now.
“I’m an older generation, and we were looking at the stone saying ‘Wow, it’s really beautiful’, but there’s something that would stop me wanting it. And this is me personally,” she says with a laugh.
Deutsch says her jewellers are still coming around to the idea of working with lab-grown stones, too.
“They were sceptical of it. They love working with the beautiful natural diamonds and sapphires and emeralds, which is what we [are] used to. I’ve brought them around, because I said, ‘Look, if this is the world and this is what people are asking for, [then] they’re slowly opening up to it now when they see these lovely examples’,” she says.
Still, the increased supply of lab-grown diamonds is something Deutsch says could potentially increase the perceived value of natural diamonds. “Perhaps given that the market is currently flooded with lab-grown diamonds ... this may lead to the consumer feeling that natural diamonds have more worth,” she says.
“There’s all different views out there. There’s the view from some that it’s a bit fly-by-night, but I think we just have to wait and see. Because it may be the way of the future or you know, will people value something that’s sat under the ground for millions and millions of years to form and there’s something special about that.”
In any case, Jeramie Hotz and Talia Shuvalov believe working with sustainable lab-grown diamonds opens up the possibilities of design.
“We are working with a lot of carats. [A] bracelet here is seven, almost eight carats of diamonds … We are able to work with a lot bigger stones and create something a little chunkier in a still accessible price point,” says Shuvalov. “It really felt like it was important for us to work in a way that felt different to what anyone else had done. And I felt that both being ethical and finding a way into the market that wasn’t what was already out there. I think lab-grown really answered that for us. And I think it’s a challenge, which was an interesting one to us. I don’t think it’s the obvious route for a fine jewellery brand.”
Ultimately, both come back to the idea that jewellery is about an instinctual attachment, something that draws you in. “[We] think they’re for someone with a discerning eye who is an emotional buyer. I think we wanted to create something that felt emotional and you have a response to and not feel like anyone had really ever seen something like that before. But also feel classic and timeless,” says Shuvalov.“
We want these pieces to have longevity and to be passed down,” adds Hotz.
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