Will diamonds follow the path of pearls?

[uxr51]

So I have been looking at diamonds and their value vs lab grown counterparts. I have noticed lab grown diamonds have gotten big, cheaper, colorless, low inclusions and starting to see super ideal cuts. Chemically they are the same, they look the same and only a lab would be able to tell the difference.

It appears many companies including De Beers are rushing at this and in a few years the market will be flooded with cheap perfect diamonds.

Do you think natural diamonds will become something for collectors like natural pearls? Do you think the younger generations will give value to a natural piece of identical carbon they can buy anywhere for cheap?

I remember my grandmother giving so much value to pearls, my parents a bit less, and my generation mostly doesn't care about pearls probably due to the market being flooded with cheap cultured pearls.

Does anyone else think the diamond market will be headed for a crash in just a few years? Perfect diamonds will be able to be produced by huge factories and cut and polished by robot lines and slowly younger people will start to lose interest in the value of the natural diamond.

Thoughts?

 

[winnietucker]

My (inexperienced) thought is no. You see other lab gemstones sell cheap while their natural counterparts (ex: rubies) are still expensive. I think there will always be a market for natural diamonds.

 

[Texas Leaguer]

Cultured pearls is a fair analog for what we are seeing in the lab grown diamond evolution. Perhaps a better model is synthetic corundum (sapphire/ruby). First synthesized in the early 1900s they quickly became abundant in the market and price eventually dropped to pennies per carat. Meanwhile the market for natural earth mined rubies and sapphires was ultimately not impacted, and today gem quality natural stones continue to break records for price per carat.

What tends to happen when a new alternative to a natural gem hits the market is a brief period of competition yielding to a divergence into two separate product categories as the price of the synthetic drops to mass market levels.

 

[smitcompton]

Hi,
I think there is another aspect to this that diamond dealers won't like discussing. Natural Rubies and Sapphires are much scarcer than natural diamonds. Most people understand that Debeers controlled diamonds for many years and held prices at artificial levels. Smaller sizes in diamonds are way overpriced and probably will come down to stay in competition with manufactured diamonds. Rare diamonds with high color, large size, excellent clarity will keep their value. but I think the average diamonds will be less than today. I also think colored diamonds that are scarce will be the ones to increase in price.

Young people need money for homes and school loans. I don't see the new generation interested in diamonds. Not All, of course. If prices go lower more people might become interested.

Annette

 

[distracts]

I think sapphires/rubies/spinels are a better comparison. They've been around for over a hundred years, and at first were more expensive, then roughly on par, and during these times they were set in fine jewelry, then eventually they dropped in price until now they are costume jewelry at incredibly reasonable prices.

I do think because of how comparatively common diamonds are, and because of the publicity around environmental/human impacts (also applicable with other gems, but since it's not publicized, most people don't connect them to it - good example of the myopia of concern over certain issues), more downward force will be exerted on prices - but I think natural diamonds will still be more valuable (perhaps dramatically so) than their lab-created counterparts. I don't think we'll see any downward force on price for colored diamonds.

I suspect most of those making lab-created diamonds though will do everything they can to prop up the prices. DeBeers is the only company I see out there trying to market them as costume jewelry, and, uh, I'm sure they've got their own interest in doing so

 

[Karl_K]

My prediction is that mmd will be 90%+ of the market in 30 years.

 

[distracts]

My prediction is that mmd will be 90%+ of the market in 30 years.

But that says nothing regarding pricing or continued demand for mined diamonds - If we are including synthetic and natural sapphires in the same "market," then I'd guess that synthetic sapphires are 90%+ of it, but demand for natural sapphires certainly is still strong. I have lab-created sapphires for things like necklaces and bracelets where it would be outside of my financial reach to have matched sets of reasonable size, but that in no way impacts the market for natural sapphires because I wasn't deciding between a similar natural set or a lab-created set - it was the latter or something like a blue swarovski crystal. Likewise I think if the price for synthetic diamonds drops, I think a takeover of the CZ and moissanite markets is more likely than a takeover of the natural diamond market.

 

[Texas Leaguer]

My prediction is that mmd will be 90%+ of the market in 30 years.

But WHAT market is the question.

The jewelry industry is not a monolith. It is composed of many distinct sub-markets. There is the top, top end auction market, the fashion jewelry market, the bridal market, and the accessory (costume jewelry) market. There are other distinct markets within some of these.

I agree that mmd will find their level, just as other synthetics have. They clearly have an important place in the jewelry industry. I don't think they are likely to ever represent a significant part of the engagement ring market because they lack that essential element of authenticity and exclusivity that is symbolically very important.

 

[Karl_K]

But WHAT market is the question.

The entire market across the board will be 100% mmd some day.
Mining is doomed, the mines are playing out and who would spend 20 billion bringing a new mine online?
Even if they did it would just push it a little further down the road.
Not to even begin the environmental debate, would they even be allowed to if they wanted to?
In many parts of the world the answer is no.
DeBeers has set the price that they will be hard pressed to keep up that high for mmd.

 

[Karl_K]

But that says nothing regarding pricing or continued demand for mined diamonds -

That could go several different ways and there really isn't any way to say.
It will be based on emotion not business logic.

 

[Lisa Loves Shiny]

Just from a consumer standpoint- I don't buy synthetic colored gems. I actually prefer if there is at least some inclusions I can see under a loupe as well as a reputable lab report on higher priced colored gems. There are so many variances in color shades, inclusions, and brilliance. But for diamonds I feel differently. I would definitely buy a lab diamond. IMHO when you compare similar cut diamonds of similar clarity and color- there really isn't much difference. Old cuts being the exception. Just my opinion.

 

[RunningwithScissors]

I don't know what generation the OP is, but I'm Gen X and I care a lot about pearls. I know many Millennials who also wear pearls almost everyday at work, its part of the East Coast, professional/upscale office uniform. And for women in the South, as I am, its part of our afterwork, semi-dressy uniform too whether we're attending an evening cocktail party or Sunday brunch with girlfriends.

 

[sydneyatl]

I don't know what generation the OP is, but I'm Gen X and I care a lot about pearls. I know many Millennials who also wear pearls almost everyday at work, its part of the East Coast, professional/upscale office uniform. And for women in the South, as I am, its part of our afterwork, semi-dressy uniform too whether we're attending an evening cocktail party or Sunday brunch with girlfriends.

Fellow southern gal here and I agree with you on the versatility of pearls here. That said, I don’t think most of the ones I see are real...I know my genuine pair is stored away and I have a pair of good fakes that I wear daily to work. Almost every time I’ve complimented someone on their pearls they laugh and tell me they bought them from Etsy for $5.

 

[RunningwithScissors]

@sydneyatl Wear your good pearls woman! Life is short, no sense owning something nice if you don't use it.

(Plus, pearls dry out and die in storage.)

That said, I always loved Barbara Bush's very large faux pearl necklace. That woman was a class act (no matter what we may think of her husband's politics.)

 

[Dancing Fire]

MMD will soon sell for XX dollar per lb not XX per ct.

 

[Daisys and Diamonds]

I don't know what generation the OP is, but I'm Gen X and I care a lot about pearls. I know many Millennials who also wear pearls almost everyday at work, its part of the East Coast, professional/upscale office uniform. And for women in the South, as I am, its part of our afterwork, semi-dressy uniform too whether we're attending an evening cocktail party or Sunday brunch with girlfriends.

im moving to your town !
i wish more younger people would wear pearls
im generation X too and my mum and grandma wore pearls lots but i never paid much interest in them till i recently inherited mum's pearls
now i love them
the mall jewlers here (in NZ) have a tiny but interesting selection of pearls at verrying prices but its a start after years of hardly anything
i think young hollywood or Kate & Meghan and some of the other younger royals should wear them more
im sure their (pearls) time will come again
they are so classic - younger and also some older ladies just need reminded of this - the ladies in your neck of the woods know they never went out of style - and pearls just love to be worn

and although i only have one created saphire ring (i feel in love with the colour) for the price of it i don't consider it costume jewlery
i might buy a created diamond one day - who knows, i like the idea no one had to dig it out of the ground like they did for my mother's and grandmother's diamond rings
a created diamond is still a diamond

 

[MissGotRocks]

Ain’t nothing like the real thing baby! There will definitely be a market for MMD but I seriously doubt they will ever wipe out the diamond market.

 

[distracts]

The entire market across the board will be 100% mmd some day.
Mining is doomed, the mines are playing out and who would spend 20 billion bringing a new mine online?
Even if they did it would just push it a little further down the road.
Not to even begin the environmental debate, would they even be allowed to if they wanted to?
In many parts of the world the answer is no.
DeBeers has set the price that they will be hard pressed to keep up that high for mmd.

Well - already-mined diamonds will still exist, and if you can't get new ones, wouldn't that make the prices of natural diamonds go up? I suspect if mining stops, natural diamonds will become more of a wealth-storing commodity like gold than a fashion accessory. That doesn't actually really make sense to me - like if the whole financial system collapses, who exactly is going to be buying diamonds and gold? I'd rather have a stockpile of potatoes. But it's definitely how a certain subset of the population thinks.

 

[MMtwo]

A mined diamond will continue to be a status symbol.

 

[whitewave]

Cultured pearls is a fair analog for what we are seeing in the lab grown diamond evolution. Perhaps a better model is synthetic corundum (sapphire/ruby). First synthesized in the early 1900s they quickly became abundant in the market and price eventually dropped to pennies per carat. Meanwhile the market for natural earth mined rubies and sapphires was ultimately not impacted, and today gem quality natural stones continue to break records for price per carat.

What tends to happen when a new alternative to a natural gem hits the market is a brief period of competition yielding to a divergence into two separate product categories as the price of the synthetic drops to mass market levels.

I tend to believe this will happen.

I almost want to say I don’t care what happens because I buy my jewelry for me to enjoy today and I want what I want. When I die or get old and pass my pieces down, then I would imagine natural diamonds would still have value and my heirs can either wear them or sell them to do whatever they want with whatever money they get— and likely would pass the diamonds on to other collectors who will love them.

Plus, for me, it’s also about showing my heirs who haven’t even been born yet and who I may never meet about what kind of woman I am/was. Awesome lol.

So for me, this is almost an irrelevant question about MMD vs natural.

 

[smitcompton]

Hi,

The words that standout in this discussion are trending and subset. I think OP was talking about Natural Pearls vs Cultured pearls. I do agree that pearls went out of favor for quite a while, but have, within the last decade made a comeback. I just know they were considered old fashioned for sometime. So trends come and go. There are not enough Natural pearls to meet demand so cultured pearls are a wonderful substitute and most people can afford them.

It has been suggested that diamonds are a status symbol. I think only to a certain subset of people.
I grew up in a middle class neighborhood where no-one ever expressed their desire for a diamond. No-one had a diamond. Cars, a nice ring, sterling silver flatware, crystal, china, and most often---A Fur Coat or something mink was desired. The status symbols of yesteryear among my neighbors and relatives.

Women of a certain age have heard over and over through advertising that diamonds are special. The new generation does not see this as being important. As time goes on less and less women will want or need a natural diamond for an engagement. Older women as represented on PS buy diamonds as finances allow. The younger person has other needs and if MMD becomes much cheaper they will gravitate toward that as they do moissanite.

I have wondered why Movie Stars don't buy their own diamonds but let HW supply them. If it was such a status symbol why don't they have their own. Yes, engagement rings they do have but they borrow for fancy occasions. I think its less of a status symbol than you think. Just a subset of people.

Annette

 

[denverappraiser]

Even if diamond mines go away, which I think is unlikely, mined diamonds will not. Approximately every diamond ever mined is still out there. They are really pretty durable little things, unlike pearls, and although you can damage and lose them in the ocean or whatnot, most are just as lovely as the day they were first cut and are in the hands of someone who treasures them. This will not be different in 100 years.