Are lab-grown diamonds really better for the earth? – Mint Lounge

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By Pooja Singh
When Aangi Jhaveri started shopping for her wedding in 2019, she was clear that she didn’t want mined diamonds. The financial consultant, who grew up reading about environmental degradation and taking part in weekend cleanliness drives, was aware of the cost of mining gems. She wanted diamonds made in a laboratory.
Her mother was upset. “We have been saving for your wedding since you were a child. Why do you want fake jewellery?” They are not fake, Jhaveri argued; “they are just not created beneath the ground.” The fact that you could grow a diamond in a laboratory by simulating the earth’s force in a vacuum chamber fascinated her. “They are 40% cheaper and manufacturing them isn’t as destructive as mining,” Mumbai-based Jhaveri, now 30, explained to her parents.
Also read: World’s No. 1 jewellery maker is ditching mined diamonds
Her father was sold, not her mother. Jhaveri took her to a store in Mumbai and her mother spent hours asking questions till she was convinced. Jhaveri and her partner bought their engagement rings, and her mother, a pair of earrings.
Today, if you are shown both natural and lab-grown diamonds (LGDs), chances are you won’t be able to tell the difference. In fact, no one would till they are put under a microscope. LGDs are not imitation diamonds, as cubic zirconia or moissanite are. LGDs have the same chemical, physical and optical properties as the ones formed over billions of years beneath the earth. It takes 15-30 days to create them in a laboratory in Surat in Gujarat, India’s diamond capital. And they are cheaper—a one-carat mined diamond could cost as much as 5 lakh while its lab-made counterpart may be priced at 1-2 lakh.
India is on its way to becoming a hub for the production and processing of LGDs. The country, which produced 1.5 million carats last year, is playing catch-up with China, the current world leader with an output of three million carats, says a Bain & Co. report released in March. From a global perspective, production of LGDs rose to six-seven million carats last year, while mined diamonds fell to 111 million, having peaked at 152 million in 2017, notes the Antwerp World Diamond Centre, a public-private corporation, in Belgium. The total market share of LGDs is expected to account for 10% (estimated at 19.2 million carats) of the worldwide diamond market by 2030.
Much of the demand is coming from American, European and Australian shoppers, who, like Jhaveri, are seeking affordability and turning away from mined jewels as unethical and environmentally harmful. In India, awareness of LGDs is growing slowly, say experts.
The green factor
Are LGDs indeed as environment- friendly as they are made out to be? Pooja Sheth, founder of Mumbai-based Limelight Diamonds, which describes itself as India’s largest lab-grown diamond brand, says a carat LGD saves 109 gallons of water and 250 tonnes of land extraction. “Plus, we have all seen Blood Diamond to know how problematic mining is. All of this is absent in an LGD,” she adds, referring to the 2006 film on conflict diamonds.
The highly regulated mined-diamond industry, in the firing line for decades, has its arsenal ready. Sachin Jain, managing director of De Beers India, says: “The majority of LGDs are produced using fossil-fuel energy, and with the very high energy requirements for producing LGDs, this can have a significant impact. LGDs deliver minimal socioeconomic benefit in the developing world.”
A 2019 Total Clarity Report, commissioned by the Diamond Producers Association (later renamed Natural Diamond Council), suggests the greenhouse gas emissions produced when growing diamonds in a lab are three times more than mining natural diamonds. The association happens to represent seven of the world’s largest diamond miners, including Alrosa and Rio Tinto.
“At De Beers, we manage half a million acres of land in Africa for conservation purposes, six times the area used for mining, and we have a multimillion-dollar research programme that uses the host rock in which diamonds are found to capture carbon gas from the atmosphere, turning diamond mines into carbon vaults,” says Jain.
That’s not all, they maintain. Mining rules mandate that all companies have to care for the environment and livelihoods of locals. “Work on a site starts 10-12 years before operations start and once the mine is shut, companies continue to work at the site to restore it,” says Richa Singh, managing director (India) of the Natural Diamond Council.
What is clear is that while the effects of mining have been documented over the decades, the jury is still out on how “green” LGDs are. Experts suggest their main attraction may be lower price points. Some compare mined diamonds and LGDs to real and cultured pearls, saying the two will coexist.
Through all this, one point is indisputable: Supply of mined diamonds is finite.
The story so far
LGDs are over seven decades old. General Electric created them in the 1950s and put them to industrial uses like cutting and polishing. Traders mounted fierce opposition to their use in jewellery, fearing a drop in prices of mined diamonds.
Now, the diamond mining industry is running out of gem deposits to extract. Mined-diamond supply is likely to dip to 62 million carats by 2030 owing to “limitation of resources and difficulty in finding commercial discoveries”, consulting firm Frost & Sullivan had said in 2015.
The prediction is turning out to be true. A year ago, Western Australia’s Argyle mine, among the world’s largest, shut for good. There has not been any major commercial discovery in recent years.
Perhaps the biggest shift in the industry began in 2018 when De Beers—which had opposed man-made diamonds for decades—launched Lightbox, a subsidiary that sells LGDs. Earlier this year, Pandora, the world’s biggest jeweller, said it was shifting exclusively to LGDs because “it’s the right thing to do”.
Looking to the future
The Bain report points out that in India, the millennial consumer—they constitute about 410 million people—in particular considers conflict-free supply chains and carbon footprint while making a purchase.
Noting the sharp rise in demand in the past three-four years, a small but growing number of jewellery brands seem to be coming around to the idea of LGDs. Rohan Sharma, chief executive and managing director of the three-decade-old RK Jewellers in south Delhi, says he plans to soon offer man-made diamonds as well.
“We Indians are emotional people and the diamond is an emotional buy,” says Sharma. “When you start creating diamonds in bulk, they lose their charm, but these conversations about sustainability are changing the consumer, especially the young. We have started getting requests from them (for LGDs). You also need to consider that all demand patterns here are driven by the trends in the West. India will have a market for LGD, but it will take some time.”
The government-supported Gems and Jewellery Export Promotion Council (GJEPC) recently noted that polished LGD exports had nearly doubled to 5,175 crore in FY2021, compared to 2,985 crore last year.
Will the rising interest in LGDs disrupt the $78 billion diamond industry?
No, says Colin Shah, chair of the GJEPC. “LGDs and natural diamonds will coexist. Natural diamonds are the ultimate gift of love. It’s like spending 10 lakh on a Sabyasachi or Manish Malhotra wedding lehnga. You know you will wear it only once in your life but it will always be special.”
Last year, he says, exports of natural diamonds from India fetched $22 billion and LGDs, $1 billion.
“In comparison, $1 billion may seem small but it’s great growth in a span of three-four years. LGDs are picking up in a big way; it’s the perfect Atmanirbhar Bharat project,” says Shah. “And what sets us apart from the rest is our world’s-best craftsmanship.”
Manish Jivani, who has been producing natural diamonds for over two decades in Surat, took to LGDs three years ago. He calls them “the product of the future”. Each year, 200 workers in his factory process 7,000 carats of natural diamonds. Four machines and another 50-odd workers produce 2,000 carats of LGDs, 90% of them for export.
In three years, his revenue has tripled. “It’s a huge opportunity for us in terms of forex. Everything is home-made,” Jivani, 45, says over the phone. “When I started, India hardly had any demand but now we are getting a lot of requests from Indian brands. Many natural players are also investing in lab-grown. It’s like a gold rush. It’s like pearl, both cultured and natural ones have a dedicated market. Huge potential.” In the next five years, he believes, LGDs will become a $5 billion industry for the country.
Jivani is not exaggerating. Shah shared a similar number. “There’s a customer for each category. Shopping for diamonds won’t change; you will now just have more variety at different price points,” says Shah. “We need to create awareness about it, which is where the government can help.”
Business sparkles
“Diamonds have been a mark of status. But things have changed,” says Sheth. “Today’s millennial wants the feel-good factor and lab-grown gives you all that: green, real, price.” Sheth, who has a background in finance, learnt about LGDs from her uncle, one of the biggest producers of lab-grown diamonds in Surat.
She set up her brand in 2019 and now has stores in Mumbai, Delhi, Hyderabad, Kolkata, Bengaluru, Ranchi and Goa. She has seen 60% year-on-year growth despite a lull during the first lockdown, she says. The majority of her clients are women.
Sisters Aishwarya Guptha and Soundarya Guptha, gemmologists and third-generation jewellers, opened their second Wondr Diamonds store in Chennai earlier this month and plan to expand across south India by the end of 2021.
“We started this brand last year after we did a small survey. I bought 20 lab-grown diamonds and showed it to my friends and family. They were all bought in one go,” recalls Soundarya. “India is a value-driven rather than a brand-driven market, which is why I think they will pick up here.”
Sujata Rao agrees. The business head of Orra jewellery’s soon-to-launch Divaa sub-brand, which will offer LGDs, says: “LGDs in jewellery have been growing in popularity internationally for some time now. There is also the potential with the more mature consumer who wants to buy larger diamond jewellery and this puts such elegant pieces within their price bracket without compromising on quality.”
Some remain unconvinced. Sunint Chadha of Delhi’s BSJS jewellers, founded in 1930, describes LGDs as “artificial jewellery” and asserts, “You can’t make diamonds in three months.” Tarang Arora, chief executive and creative director of Amrapali Jewels, says he toyed with the idea of using LGDs in their collections five-six years ago. “We might look at it but as a separate sub-brand because introducing it in existing collections would be risky. The customer might get confused. We don’t have the awareness yet.”
“LGDs are made in batches in factories with no limit on supply, so industry analysts expect that they will continue to become less and less valuable as costs of production decline, and they will be used in lower-priced fashion costume jewellery, just as has been the case with synthetic or laboratory-grown rubies, emeralds and sapphires,” argues Singh. Natural diamonds, she adds, will become rarer and hence, more valuable.
Vandana Jagwani, founder of one-year-old Vandals, a designer jewellery label that offers LGDs, is quick to counter concerns that LGDs may not have resale value. “They work exactly like mined diamonds. There’s cashback or you can get them redesigned,” explains the 20-something entrepreneur, who believes LGDs “are all about progress; they are the gift of technology”. She argues that the mined-diamond industry “knows we can be a strong competitor. That’s why the cold shoulder.”
Jhaveri, meanwhile, is more than happy with her purchase. Since her wedding, she has inspired many of her friends and relatives to go in for LGDs. “Nobody can make out it’s natural or lab-made till you tell them. What’s not to like?”
Also read: Jewellery that knows no gender
 
 

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