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LABORATORY GROWN DIAMONDS

COVID CRISIS LEADS TO LOWERING OF TENSION BETWEEN NATURAL AND LAB-GROWN DIAMOND SECTORS

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Is the COVID-19 crisis precipitating a truce or at least an agreed-to modus operandi between the natural and laboratory-grown or synthetic diamond sectors. Forbes contributor Pamela Danziger seems to think so. ā€œIn a global market transformed by COVID-19, the lab-grown and mined diamond industries have called a truce as they now face a common enemy: declining consumer demand,ā€ she suggests in an online article published by the economic journal.

In part, the truce has cam in reaction to a sift undertaken by the new Natural Diamond Council, which was launched in June as the successor ofĀ  the Diamond Producers Association, a body started and financed by the worldā€™s seven largest diamond producing companies and charged with the generic or category advertising of diamonds found in nature.

The DPAā€™s original campaign, which was launched in 2015, made the relationship between the two sectors particularly contentious. Called ā€œreal is rare,ā€ it clearly implied that laboratory-grown stones are not real, despite the fact that they and natural diamonds share the same chemical composition.

With the creation of the Natural Diamond Council have adopted a new slogan ā€œOnly Natural Diamonds.ā€ While clearly demarcating a preferred position for itself, it did not paint synthetic stones in a negative light.

ā€œā€œThe current economic climate creates unprecedented challenges for the luxury industry,ā€ stated David Kellie, the organizationā€™s CEO. ā€œBut, as the climate improves, natural diamonds will connect stronger than ever before. Consumers will have a greater respect for all things natural and seek brands that have an honest mission to be truly sustainable. Theyā€™ll be purchasing luxury goods with a greater meaning, particularly those celebrating connections between friends and loved ones.ā€

NO ARGUMENT ANY LONGER ABOUT WHAT IS REAL

Speaking to Forbes, Richard Garard, Secretary General of the International Grown Diamond Association, a body representing some of the larger laboratory-grown diamond producers, acknowledged that the attitude of the natural diamond sector appears to have changed.

ā€œWhile in the past, we have seen the disparaging and discrediting of lab-grown diamonds, that tactic really didnā€™t work for anyone,ā€ he stated. ā€œFrom the mined industry not acknowledging lab-grown diamonds as ā€˜diamond,ā€™ to the FTC revisions that made amply clear that there was no scientific difference between the two diamonds except their origins, lab-grown diamonds have finally arrived.ā€

Garard was referring to a decision made by the U.S. Federal Trade Commission in 2018, according to which it expanded its definition of ā€œdiamondā€ to include those grown in a laboratory.

ā€œWhen the commission first used this definition in 1956, there was only one type of diamond product on the market ā€” natural stones mined from the earth,ā€ the FTC said. ā€œSince then, technological advances have made it possible to create diamonds in a laboratory.Ā 

These stones have essentially the same optical, physical and chemical properties as mined diamonds. Thus, they are diamonds.ā€

The Diamond Producers Associationā€™s ā€œReal is Rareā€ campaign was replaced in June 2020 by the ā€œOnly Natural Diamondsā€ campaign of the new Natural Diamond Council.

Nonetheless, the FTC still requires synthetic diamond producers to clearly define their stones as being created, not really rejecting the earlier assumption that if a stone is simply called a ā€œdiamond,ā€ then it can reasonably be assumed to be natural. The FTC also accepted that lab-grown producers contention that ā€œlaboratory-grown diamondā€ should be the accepted terms, agreeing that even though ā€œsyntheticā€ may be used as descriptor, consumer may erroneously believe that it is a fake diamond.

Richard Garard. Secretary General of the International Grown Diamond Association, speaking in Bahrain in November 2019 at the annual congress of CIBJO, the World Jewellery Confederation.

DISCUSSIONS LEADING TO RAPPROCHEMENT

The start of a rapprochement between the natural and laboratory grown diamond sectors already preceded the onset of the COVID-19 crisis. In November 2019, at the CIBJO Congress in Bahrain, presented a draft of a document, drawn up by members of both the natural and laboratory-grown diamond sector, intended to provide guidance for clear product differentiation.

The ground goals for the group preparing the document, noted the chairman of the working committee, is to protect consumer confidence. To ensure this, he said, consumer confidence jewelry purchasers must receive complete and unambiguous information about what they are buying, so that they can make a consciously informed purchasing decision. This should be carried out with mutual consideration by all sides, so as not to harm the natural or laboratory-grown diamond sectors in marketing their respective products.ā€

The International Grown Diamond Association Secretary-General was also present at the meeting in Bahrain. ā€œWe think the US Federal Trade Commission guidelines enable both natural and LGD to exist. We hope that a document will be produced that can take this issue forward,ā€ he told the gathering.

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