Lab-Grown Diamond Valuation (8.03)
Lab-grown diamond pricing has been in a free fall in the past number of years. In 2021 dealers were amazed that the discounts were 90% off of Rapaport Diamond Report List (discussed in subsection 18.06). In 2025 prices are discounted 99-99.5% routinely. Factors driving these deep price reductions include:
Efficiency in Production Costs: Since lab-grown diamonds can be made in weeks or months with no mining costs and far less overhead in employees and manufacturing versus mining equipment pricing has come down dramatically. CVD (chemical vapor deposition) grown diamonds are more efficient since the necessary energy consumed is a fraction that of the production of HPHT (high-pressure high-temperature) grown diamonds.
Lab-grown diamond production does not have to be concerned with political international tensions in the countries in which they operate. They can set up shop almost anywhere giving the extreme advantage of choosing the most cost effective locations and supply chains.
Almost Limitless Supply: Even though the demand is intense the sheer volume of worldwide production and the number of players now in the lab-grown business has created an over supply bringing the prices to an all time low.
Technology: Even though the technological advances will likely soon hit that plateau on the S curve refinements will continue to increase the efficiency of cost effective lab grown diamonds.
The above illustration is courtesy of: https://www.edahngolan.com/