Is It Game Over For Mined Diamonds?

Investors are grappling with unprecedented uncertainty due to inflation fears, slowing growth, and global trade tensions. Similar anxiety is spreading through the diamond industry for a different reason: the rise of lab-grown diamonds. This disruptive technology has generated panic for some but opportunities for others.

Lab-grown diamonds have quickly gained mainstream acceptance, mainly due to changing perceptions. Chemically identical to mined diamonds, they sell for just 10% of the price. Regardless of one’s opinion on authenticity, lab-grown diamonds are transforming the industry, and anybody considering buying or selling a diamond should pay attention.

Evolution In Lab Diamond Pricing

Ten years ago, lab-created diamonds were priced approximately 10% below their natural counterparts. Over the past decade, technological advancements and increased production have caused lab diamond prices to plunge dramatically. Today, they’re typically sold at an 80–90% discount to mined diamonds.

This price drop has significantly boosted market share. In 2015, lab-grown stones accounted for just 1% of diamond sales but rose to approximately 20% by 2024. Engagement ring trends have shifted even more dramatically. According to wedding platform The Knot, 52% of center stones were lab-grown in 2024, up from 12% in 2019.

Impact On Mined Diamonds: Consumer Preferences & Industry Shifts

Consumer attitudes toward diamonds are shifting. Buyers today are often willing to choose a lab-grown diamond to get a larger or higher-quality stone for the same budget. The perception that a diamond is a diamond regardless of origin has gained traction since there is no readily available way for consumers to tell the difference.

Lab-grown diamonds can be compared to generic medications. Lab diamonds are chemically and visually identical to mined diamonds, just as generics match brand-name drugs in active ingredients. The only difference is cost.

This trend is driven by younger consumers who value ethical and environmental aspects. Many customers who might have purchased a smaller mined diamond a decade ago now opt for a bigger lab-grown stone at the same price.

While consumers are happy to have alternatives to expensive mined stones, some industry participants struggle with the transformation. Many dealers with high inventory of mined diamonds have had to adjust prices lower, hurting margins. Dealers slow to embrace the trend have lost overall market share. Retailers who do not have their heads in the sand are now stocking lab-grown inventory and marketing it aggressively. Some dealers have even stopped selling mined diamonds altogether.

Lab-grown diamonds are also reshaping the perception of diamonds as a store of value. As affordable lab-grown options flood the industry, the resale value of older mined diamonds has diminished, leaving owners with pieces that fetch far less today.

Highlighting another stress in the industry, major mining companies such as De Beers have cut production and even launched their own lab-grown lines to adapt. Industry giant Anglo-American has been trying to sell or spin-off De Beers since last May and took a $2.9 billion write-down on its stake in 2024.

Diamond Price Outlook

The growing acceptance of affordable lab diamonds has put significant downward pressure on mined diamond prices. After a brief pandemic-era boom, natural diamond prices have collapsed to multi-year lows. According to data published by industry expert Paul Zimnisky, prices for rough, mined diamonds fell 34% from their peak in 2022 to late 2024. Lab-grown stones have eroded the pricing power of natural diamonds, especially in more standard sizes and qualities.

Martin Rapaport, founder of the Rapaport Diamond Report and RapNet, an online diamond trading network, has recently faced intense criticism for lowering diamond prices on the Rapaport Price List in January 2025. A viral Instagram post showed him arguing with dealers about the reality of lower prices.

With respect to lab-grown diamonds, industry experts expect further price declines as production scales and manufacturing costs fall in China and India. Currently priced around 90% below natural diamonds, lab-grown diamond prices could drop an additional 50–80%, according to Diamond Standard CEO Cormac Kinney.

The Future Of The Diamond Industry

Walmart is selling a 5-carat round-cut diamond engagement ring with a 14k white gold band for $2,990. If you saw someone wearing it, you wouldn’t be able to tell it was made in a lab.

The growing presence of lab-grown diamonds in discount retailers like Walmart threatens the perception of diamonds as luxury items. It undermines their exclusivity, making it harder to symbolize wealth with a ring that’s widely accessible online. New trends may emerge as a result. A marriage proposer might opt for an affordable lab-grown diamond ring for sentimental purposes and add another more exclusive and coveted item—like a Rolex watch or a Hermès Birkin bag—for value and status. Such a break in tradition would be catastrophic for the diamond industry, which is already in turmoil.

The industry’s struggles are brought to light in the entertaining Netflix documentary, Nothing Lasts Forever. The film exposes some of the industry’s dirty secrets, including credibility concerns due to the previously undisclosed mixing of lab-grown and mined diamonds and the notion that natural diamond scarcity is a farce.

According to the documentary, De Beers created an illusion of diamond scarcity by controlling supply and demand. Despite relatively abundant diamonds, the company restricted market releases to maintain high prices. Through clever marketing campaigns like “A Diamond Is Forever,” De Beers convinced consumers that diamonds were rare, driving up demand and sustaining artificially high prices.

De Beers’ projection of diamond scarcity is like the man behind the curtain in The Wizard of Oz. This carefully crafted illusion that unraveled once the truth was exposed, revealed that diamonds are far more abundant than their marketed rarity suggests.

The erosion of the scarcity perception and the growing acceptance of lab-grown diamonds as a credible alternative for jewelry and other applications is a double-whammy for the vast majority of the diamond industry.

A bifurcated market may develop where truly exceptional verified natural diamonds, such as rare, flawless, colored diamonds, retain their value or even appreciate. While natural diamonds, especially smaller ones, will likely continue to depreciate as they are indistinguishable to the naked eye from their lab counterparts.

Consumers may enjoy lower prices on natural diamonds in the coming years, and those holding diamonds as assets should temper expectations about value retention or appreciation. Most signs point to lower prices, and it’s hard to imagine a scenario where they bounce back. A diamond may last forever, but its value may not.