The future of diamonds?

[Mark21]

Having just bought a diamond, of course one engages in a lot of conversations about the gemstone with others. Just this weekend, my friend and I (we are both finance professionals) were talking about the value of the diamonds we have bought for our FFs. Of course, the discussion covered DeBeers, controlled inventory releases to keep prices stable, etc... But then we discussed an article we had read about not too long ago (Scientific American? Wall Street Journal? The source escapes me...) that stated that man-made diamond manufacturers--the ones that produce them for industrial uses--have finally gotten their technology to the point they can create jewelry-level diamonds. From my recollection, the article mentioned that the one or two firms that can do this have agreed to laser-etch some mark to show that such diamonds are man-made. Then the article proceeded to show how the pearl market was destroyed by man-made pearls, causing prices to plummet in excess of 95% on some varieties...

So I'm curious about the thoughts of actual professionals that post on here and make their living in the trade about this development. I am aware that laser etching can be polished off. And it wouldn't take much for someone to think, "Why not invest 5-10mm dollars in machines based in China or some other less-regulated market, and churn out man-made diamonds that I will pass off as the real thing through alternative channels." Is the diamond supply chain tight enough to recognize a flood of fakes? From economic theory, with tens of millions of diamonds out there in jewelry, I'd see an enormous vested interest by every diamond owner (which now includes me!!) to keep such diamonds limited to keep prices from rapidly depreciating.

PS -- I'm not trolling and I'm not trying to start arguments. I'm just truly curious as to what this development may mean.

 

[strmrdr]

one process is too expensive and they are persuing the semiconductor field not jewelery right now.
The other cant get the colors too match naturals and can only do colored stones

 

[Richard Sherwood]

The advent of every synthetic (lab created) gemstone has brought dire predictions of the collapse of the market for its natural counterpart. Ruby, emerald, sapphire and many, many more gemstones have been synthesized over the past century.

In each case the predicted collapse of the natural market has not occurred, and a separate niche market has been created for the synthetic. In many cases it seems as if the synthetic market actually helped the natural market, by creating a whole new consumer clientele who started out with the less expensive synthetics and then moved up into the natural market as their means increased.

Cultured pearls were one exception to this rule. The cultured pearl market took over the natural pearl market in sheer volume. My personal opinion is that this occurred because natural pearls were so very, very rare. Far to rare to satisfy the demand. Hence cultured pearls stepped in to fill this demand. Even still, a natural saltwater pearl today commands far more money than its cultured pearl counterpart.

 

[diagem]

Date: 10/22/2007 9:15:23 PM
Author: Richard Sherwood
The advent of every synthetic (lab created) gemstone has brought dire predictions of the collapse of the market for its natural counterpart. Ruby, emerald, sapphire and many, many more gemstones have been synthesized over the past century.

In each case the predicted collapse of the natural market has not occurred, and a separate niche market has been created for the synthetic. In many cases it seems as if the synthetic market actually helped the natural market, by creating a whole new consumer clientele who started out with the less expensive synthetics and then moved up into the natural market as their means increased.

Cultured pearls were one exception to this rule. The cultured pearl market took over the natural pearl market in sheer volume. My personal opinion is that this occurred because natural pearls were so very, very rare. Far to rare to satisfy the demand. Hence cultured pearls stepped in to fill this demand. Even still, a natural saltwater pearl today commands far more money than its cultured pearl counterpart.

Rich is correct..., none of the "natural" gemstone markets have collapsed when synthetics came along...
And natural pearls as far as I know..., command big $$$ especially in the Antiques...

The only problem I foresee in regards to Lab. grown diamonds at this stage is..., the natural industry itself...
The resistance the industry is creating in regards to these Lab. grown counterparts will in my opinion create the monster itself...

After all..., there should be a place in this huge market for lab. grown diamonds..., especially when their makers are willing to participate with natural gem labs in the education/revealing of the secrets its creation... (an important step for identification!!!)

The Diamond industry is going through some "major" changes these past few years..., and I for-see these changes becoming much more intense in the next few years..., a lot of "old-school" members of this great industry are just not surviving due to their "primitive" thinking..., the old days are over!!!

We (industry members) need to ''learn'' to adapt to these changes and use them for positively!!!