Masisi worried about growth of lab-grown diamonds
Pauline Dikuelo | Tuesday October 31, 2023 06:00
Masisi, whose country Botswana produces gem quality stones, added the synthetics have rapidly gained ground in the market posing both challenges and opportunities for the industry.
“At first glance, the rise of LGDs may seem like a formidable challenge to the natural industry. However, the key to maintaining a thriving market for natural diamonds lies in effective segmentation and marketing,” he told a Facets conference held in Gaborone last week.
The ‘Facets 2023 Motswedi Wa Khumo for change’, was a two-day forum that brought together key players from the diamond industry and related sectors. Masisi further told the industry captains that the differentiation is primarily driven by marketing strategies and ability to appeal to distinct customer groups.
Lab grown diamonds have been reported to be taking over from the naturals and gaining more market traction in the recent years, as their cost of production have dropped sharply but not at the same pace as their shelf price which provides a tidy margin for retailers. In recent years, thousands of synthetic laboratories have opened in India and China, flooding markets particularly the US with increasingly cheaper stones. These products are consistently marketed as being ethically and sustainable produced compared to natural diamonds which plays well with the increasingly discerning American consumer, especially at a time when sanctioned Russian. According to De Beers’ own data sets, the number of synthetic diamonds labs in India is due to jump to 9,000 this year from 6,000.
This year’s figures come as natural diamonds experience a difficult period with De Beers recently reporting that the value of its first half sales dropped by 23% while prices achieved also dropped 23%. Recently DeBeers announced it s reinvesting all its strength into natural diamonds by injecting $20 million to support the consumer demand for natural diamonds for the 2023 holiday season in the United States and China.
The move will also see the reintroduction of their “A diamond is forever’ tagline and a shift from producing synthetic engagement and wedding rings. The group’s CEO, Al Cook announced that they have stopped selling Lightbox lab-Grown Diamonds (LGD) engagement rings but will rather focus on where it sees the most promising future opportunities in the sector, mainly in fashion jewellery and in loose stones at accessible price points. About five years ago De Beers poured $94 million into producing lab-grown diamonds ,a move that was due to strong consumer demand and the need to take a market lead in clearing the confusion between synthetic and natural diamonds.