Are lab-grown diamonds "real"?
After cutting and polishing, a "rough diamond" becomes known as a "polished diamond". If we compare a natural diamond to a synthetic one in terms of their chemical composition, then, yes, synthetics are "real" diamonds, but not completely. The content of trace elements in synthetic stones is different from natural diamonds, hence the distinction.
When comparing natural and synthetic diamonds by appearance, there are no differences between them, as they look identical. However, it's important to understand that both natural and synthetic diamonds have different characteristics, ranging from lower to higher grades. Diamond characteristics include carat weight, color, clarity, cut quality, and fluorescence. It is correct to say there are no differences between natural and synthetic diamonds when comparing stones with the same characteristics.
Therefore, when it comes to appearance of jewelry with natural or synthetic diamonds, there's no difference.
But when it comes to the stones’ origin, synthetic diamonds are not "real." Synthetic diamonds are cut from rough stones produced in factories, while natural diamonds are cut from diamonds extracted from the earth.
The main difference between natural and synthetic diamonds however is that natural ones are considered gemstones, that is, stones that retain high value over time. Natural diamonds typically even appreciate significantly over time. This is because the cost of diamond mining only increases in the long run, and reserves in open-pit deposits are limited. This is especially true for high-quality and large stones. In other words, owning a natural diamond has an investment component, which is why they are called "gemstones."
On the contrary, synthetic diamonds are a type of industrial goods that can be produced in unlimited quantities, and the more sophisticated the technology is and the greater the production volumes are, the cheaper it becomes. Consequently, synthetic stones always become less valuable over time. Therefore, we cannot call synthetic diamonds "gemstones."
Are synthetic diamonds a boon or a bane?
Synthetic diamonds are currently approximately 50 times cheaper than natural diamonds. However, such a difference between natural and synthetic diamonds is rarely found in jewelry today. This is because buyers worldwide have become accustomed to diamond jewelry being expensive. Therefore, it makes sense to avoid "disappointing" the buyers, and to continue offering synthetic diamond jewelry at a higher price. Even if these diamonds are not natural, but synthetic, and are much cheaper.
This is happening all over the world: jewelry manufacturers and retailers strive to opportunistically increase their margins by only slightly lowering the price of jewelry with synthetic diamonds compared to pieces with natural stones. However, synthetics cost significantly less for jewelers and retailers.
Therefore, it is crucial to openly inform customers whether the diamond in a jewelry piece is natural or synthetic. The buyer has the right to decide whether they are willing to spend just slightly less and end up buying a jewelry piece with a synthetic diamond at a price that is, in fact, significantly higher than it should be. Alternatively, they can choose to pay more for a similar-looking piece with a natural diamond, but without overpaying!
This situation won't last long however: the jewelry market, both domestic and global, is extremely competitive. Eventually, someone will inevitably begin to undercut their competitors, lowering the price of synthetic diamond jewelry, and not take any losses while doing so. Their margins will simply be smaller, but sales will increase exponentially. And so, over time, prices for synthetic diamond jewelry will gradually reach their much lower "legitimate" value, reflecting the actual costs of synthetics production. In other words, these synthetic diamonds will no longer be more expensive than similar jewelry with cubic zirconia or other man-made stones.
This will be a major disadvantage both for the jewelry industry and the government, as diamond jewelry currently accounts for 40% - 50% of total turnover due to the high price of natural diamonds. With the widespread replacement of natural stones with synthetic ones, the financial capacity of the market, and consequently tax collection, will fall by at least a third.
Furthermore, it should be taken into account that with the fall in prices for synthetic diamond jewelry, sold in the open market along with natural diamond jewelry, the distribution of very large stockpiled inventories of items with natural diamonds will become problematic, as reducing prices to the required lower level will entail incurring losses.
Another issue is the sharp decline in demand for mined natural diamonds. A decline in their production is inevitable, both in Russia and globally. However, due to production limitations, large diamonds, and especially high-quality ones, will skyrocket in price, as they are a rare natural occurrence. The price difference between premium natural diamond jewelry and similar-looking items with synthetic diamonds will be enormous, reflecting the difference in the actual price of natural and synthetic stones.
Strictly speaking, synthetic diamonds belong in affordable, mass-market jewelry which utilises moissanite, cubic zirconia, and other man-made stones without any need for natural gemstones. This market has a place, too, especially as precious metals prices soar while consumer income grows much slower.
Moreover, when considering synthetic diamonds as part of any jewelry item, it's important to note the emergence of entirely new opportunities for jewelers: synthetic diamonds can be produced in virtually any color. Meanwhile, natural stones are vanishingly rare and incredibly expensive. This is where the potential for using synthetic diamonds in jewelry, including high-end items, lies!
However, the buyer must know exactly what they're buying, and no pretentious marketing tactics are allowed given the need to clearly "separate" the two markets. However, we understand that in reality, many jewelry pieces today contain both natural and synthetic stones. Therefore, the term "separation" doesn't mean physically presenting pieces separately in different display cases, but rather clearly indicating what is set within the piece. For Russian retailers, this means providing information both on the jewelry tag and in the State Integrated Information System for Control over the Circulation of Precious Metals and Precious Stones.
We've become accustomed to seeing imitation brand clothing everywhere we go. We've also become accustomed to calling things what they are, and in this particular case, we call these brand imitations counterfeits despite the fact that sometimes it's nearly impossible to distinguish them from the original. The same applies to diamond jewelry, even to items with very large stones: even the expert’s eye cannot tell whether the diamonds are natural or synthetic. Only by looking at the context (who's wearing the jewelry, where, and when) will we be able to guess which diamonds are natural and which are synthetic. Whether we'll call these diamonds "counterfeit" or consider them "real" remains to be seen. In any case, the share of synthetic diamonds in jewelry will only grow in both Russian and global markets.
Perhaps, with rising silver prices and falling synthetic diamond prices, we'll see the emergence of a new mass market of silver jewelry pieces with synthetics...
Deception for the sake of promotion is unacceptable
Companies that work with synthetic diamonds resort to a variety of marketing ploys. For example, they promote the idea of some special, environmentally friendly approach to synthetic diamond production. This is complete nonsense: mining of diamonds from kimberlite pipes does not cause any significant harm to the environment. However, the production of synthetic diamonds requires a large amount of energy, which must be sourced from somewhere. And in Russia, there is an important socio-economic factor at work, as diamonds mined in the Yakutia Republic are contributing to the region's development. Meanwhile, synthetic diamond production is concentrated in India and China...
Another ploy is when a company claims that synthetic diamonds are better than natural ones, but the truth is that you need to compare stones of equal quality. Both natural and synthetic diamonds come in all grades. But there's a major catch (and the biggest consumer deception) here: the use of the same quality grading system that exists for natural diamonds, to synthetics. This system, called the "4Cs," was developed with the marketing goal of separating stones of the same name and nearly identical appearance among consumers with different income levels - from middle-class to high-income. Special price tables, so-called indices, have been devised and are regularly updated. The most popular of these tables is the Rapaport Diamond Report. But the problem is that a layperson won't always notice the difference between diamonds of lower and higher grades. This classification of colorless diamonds is a virtual convention, although the price difference between the best and the worst natural diamonds of the same weight and cut quality, according to the tables, can be as much as 80 times, especially for larger stones. This price difference only partly reflects the actual rarity of stones of the corresponding color and clarity in nature. This is what makes seemingly similar stones different for customers with different budgets.
But what's the point of such differentiation for synthetic stones? Is it a reflection of the level of technology used in their synthesis? Sure, it works at a specific moment in time, but the quality of synthesis that was outstanding yesterday will likely become utterly ordinary tomorrow! And we'll hit a ceiling: you can't produce anything purer than absolutely pure, or anything clearer than absolutely colorless, and such diamonds are already being mass-produced. Nature can't be expected to achieve perfection, but manufacturing can. So, quality charts for synthetic diamonds are nothing more than a deliberate attempt to mislead the consumer. This approach is being lobbied for globally not only by synthetic manufacturers, but also by some gemological centers hoping to expand their customer base through synthetics.
A synthetic stone and its certificate are fundamentally incompatible. It's like issuing a certificate of authenticity for a painting's reproduction. In this case, the original is a work of nature. And the synthetic is a reproduction. It would be appropriate to ask: is it possible to obtain a certificate from these laboratories for some cubic zirconia, specifying its characteristics, or a certificate for synthetic corundum? I don’t think so. But why is it possible to obtain a certificate for an equally man-made synthetic diamond?
What can we do, and how can we build a better system in one country?
It is true that Russia's share of diamond jewelry turnover is very small in global terms, amounting to no more than a few percent of the world’s demand. However, Russian market participants have tools for "bringing order" to the diamond sector that their counterparts in other countries lack: strict state regulation of the jewelry industry and the presence of two federal agencies overseeing it: the Federal Assay Office, the Federal State Agency for Health and Consumer Rights, and, of course, the Gokhran.
The solution lies in separating the natural and synthetic diamond markets not just virtually, but in practice. This separation prevents any deception in the distribution of synthetic diamonds, as they must be properly labeled and not marketed as "real" gemstones.
To achieve this, it is necessary to:
1. Establish a clear label for synthetic diamonds on the tag, one that will not mislead the buyer, such as "Synthetic Cut Diamond." It may be abbreviated, and eventually buyers will get used to it. With that, customers will immediately understand that it's not a natural diamond, but a synthetic material.
2. It is necessary to prohibit any specifications of such stones from being included on tags or in other jewelry descriptions. Only the stone's weight and, perhaps, its cut (but not the word "diamond") should be retained. The description of such synthetic stones should in no way resemble the description of natural diamonds.
It is quite possible that if the proposed standards for describing synthetic diamonds are introduced in Russia, other countries will follow suit.
Vladimir Zboikov, Executive Director of trade association "Guild of Jewelers of Russia", for Rough&Polished
