Lab-grown diamonds may soon develop their own distinct price scale that differs from that of natural diamonds, Andrey Zharkov (pictured), the former chief executive officer of Alrosa who now heads the lab-grown diamond company Ultra C, predicted during a recent webinar.
“Honestly speaking, I think that, in the future, in two or three years, we will see more pricing for laboratory-grown diamonds based on benchmarking,” he said. “It will be an important differentiation for laboratory-grown diamonds and natural diamonds.”
He said that for the moment most lab-grown sellers still base their prices on the Rapaport list—though fancy colored diamonds are priced differently.
“[For them,] we use the benchmark for colorless. The prices of fancy colored lab-grown diamonds and natural diamonds cannot be compared.”
He made the comments on a webinar hosted by CIBJO, World Jewellery Confederation, called “Natural and Lab-Grown Diamonds: Rules of Engagement.”
Wesley Hunt, director of program management, consumer and brands for De Beers Group, who also chairs CIBJO’s Laboratory-Grown Diamond Committee, noted that is how De Beers prices its lab-grown Lightbox brand.
Lab-grown diamonds are a “technical product,” he said. “So, we look at the cost of manufacturing, and we know that we can produce as much as we want, so we price it as a technological product.”
He said that the price of natural diamonds has always been based on “rarity.”
“That’s why a D color and F color have a different price,” he said.
While the webinar was aimed at getting the two sides to work together more closely, there were some areas of disagreement, particularly in the area of pricing.
Sally Morrison, who was just appointed public director for natural diamonds, said that history has shown that “as technology improves, the price curve [of the product] tends to go down,” using flat-screen TVs as an example.
Richard Garard, secretary of the International Grown Diamond Association, said that while both kinds of diamonds “have taken a hit” in prices, certain lab-grown diamonds will always be hard to grow, and their prices will likely not fall.
“It still takes the same high technology, the same expertise to grow a large D-E-F lab-grown diamond,” he says. “It does take time. Those costs do not go down. We are seeing stable prices in the larger, better-quality stones. We don’t see those prices going down.”
He added that, for now, “the demand [for lab-growns] continues to outpace the supply, even with a lot more producers coming on.”
He didn’t think that lab-growns should have a different pricing or grading system, noting that “consumers expect a comparable grading report.”
Zharkov agreed, adding that the standard GIA grading system, while it may have been developed based on rarity, is now considered by consumers to represent “characteristics of the product.”
Zharkov stressed that the two different sectors should stop taking shots at each other.
“We never used terms such as non-conflict, eco-friendly,” he said. ”We also see some natural diamond companies say that lab-growns are not real. It’s very dangerous to the marketing of diamonds. We all live in glass houses.”