De Beers joins the gold rush for diamonds grown in labs

World’s largest diamond miner De Beers to sell synthetic stones

World’s largest diamond miner De Beers to sell synthetic stones

De Beers said its new jewelry will not only be less expensive than mined diamonds, but also cost less than lab-grown stones from competitors.

De Beers has for years spoken of the synthetic diamond business as one of the major risks to the company, which has mines in SA, Botswana, Namibia and Canada. A 1-carat man-made diamond sells for roughly $4,000 and a similar natural diamond fetches about $8,000. Lab-grown diamonds have reached a level where even trained gemologists are unable to tell the two apart without highly specialized equipment. In fact, analysts predict that lab-grown sales may outshine their natural peers as early as 2020.

"Lab grown are not special, they're not real, they're not unique". Now the company has decided that if synthetics can't be beaten, it must join them - by announcing a new venture that will sell artificial diamond jewellery.

Although De Beers has long resisted selling jewelry made with synthetic diamonds, it has been creating lab-made diamonds for industrial use for more than 50 years.

Nimesh Patel, De Beers's chief financial officer, said the prices represented a 85-90% discount on the cost of natural diamonds.

"Lightbox will transform the lab-grown diamond sector by offering consumers a lab-grown product they have told us they want but aren't getting: affordable fashion jewelry that may not be forever, but is flawless for right now", Cleaver said in a statement. The lab diamonds from De Beers will sell for about US$800 a carat.

"We've learned from our research that there is a lot of confusion about lab-grown diamonds - what they are, how they differ from diamonds, and how they are valued". The process creates particles that can eventually crystallize into diamonds in 10 weeks. De Beers plans to charge US$200 for a quarter-carat, US$400 for a half and US$800 for a carat, another sharp break from natural stones that rise exponentially in price the bigger the diamond gets. De Beers' solution was to build a monopoly that controlled the world's supply in one form or another from 1888 until 2006, when it settled an antitrust suit brought by the European Union by agreeing to stop buying diamonds from its largest rival, Russia's Alrosa PJSC.

While laboratory-made gems make up just a fraction of the $80bn global diamond market, demand is increasing as buyers look for stones that are cheaper. Global diamond production was about 142 million carats a year ago, according to analyst Paul Zimnisky.

While De Beers has never sold man-made diamonds for jewellery before, it's very good at making them. That compares with lab production of less than 4.2 million carats, according to Bonas & Co.

Cleaver did not give a projection of what the synthetic diamond sales revenue could be or the level of annual sales.

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