There has been a lot of noise lately in regards to values of diamonds, more specifically with respect to lab grown diamonds (LGD) and their recent descending speed. For some odd reason.., diamantaires, mainly from the mined side of the spectrum, can’t hide their schadenfreude when week after week reports are pointing out to the dropping rate of LGD’s values.
One US jeweler even took advantage and publicized they are literally giving away LGD’s with no purchase required, just to make a point. But what good is it to show LGD’s are worthless when the majority of jewelers are marketing mined diamond jewelry at repeating claims of “best or lowest prices”…, ok not giveaway’s but nonetheless a full ongoing race to the bottom!! An unfortunate many decades old standard industry practice.
But is such bias by diamantaires justified?? Not entirely sure, let us look at another point of view, a direction most choose looking the other way, let us stare straight at our current reality.
It’s high time!
I have been claiming for years.., and still confidently assert that the value of LGD material was/is a non-issue and the simple fact that a whole global industry keeps agitating and constantly comparing LGD’s with mined diamonds on value (e.g. discounts off Rapaport Price Lists) amongst other factors are a simple manifestation to the level of comprehension majority industry members and leaders demonstrate!!
It is categorically true that for centuries-on, gem dealers and diamantaires looked upon their inventories as solid monetary worth. A trusty, comfortable approach to keep their assets close by and away from the buildup of governmental regulations and opportunistic larcenists… sure it was a great place to hold one’s wealth because of its (condensed) volume and much mystery around its true worth!
This was then…, this is now!
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Diamond Production Numbers & Statistics
All the above was appropriate within its historical context when diamonds were actually an extremely rare gemstone mineral (pre-African discoveries at the end of the 19th century) – in this latest century (e.g. 1919 – 2023) we all got indoctrinated to an erred fact that diamonds are rare, especially colorless types!
So yes…, global industry beliefs enjoyed some sort of inertia force to that doctrine in the last few decades. Until our present reality which the majority are still not completely convinced of its pretense, unfortunately!
Well, let’s look at some official numbers of the last two decades…, if we take global rough production recently supplied by Edahn Golan (figure 1) from 2004 to 2021 we can see extraction of mined rough diamonds was averaging 140,000,000 carat per annum (that would be translated to approximately 28 tons per year or 61,000 pounds).
Figure 1 – Mined Global Diamond Production by Volume 2004 – 2021
Looking a bit outwards as shown by Paul Zimnisky’s forecast, diamond production will plateau between the years 2021 to 2026 at a range of 120,000,000 – 130,000,000 carat per annum. (see figure 2) and this is within the controlled environment, not based on production capabilities.
Figure 2 – Rough Diamond Supply Volume – Forecast
Looking at Historical Diamond Production (1948 to 2005)
Even though diamond mining began centuries or millennia ago, I would like to capture 1948 as a pivotal date that changed everything in diamond marketing. This was the year that Mary Frances Gerety of N.W. Ayers & Son was assigned and created the consequential slogan “A Diamond is Forever” for De Beers which have been *exploiting these four words ever since!
Now, let’s look at some of the numbers through a wider historic scope. Figure 3 is a graph showing global diamond production by countries and carat weight from as early as the first African discoveries 1870 to 2005. I have specifically marked 1948 for easier convenience so we are able to discern how after 1948 the supply of diamonds changed forever.
We can safely assert that the year 1948 was with no doubt a pivotal year for the marketing of diamonds, which was conducted on a large scale growing steadily from an annual production of 18,000,000 to 30,000,000 carat in the 1960’s, to an annual production plateau of about 40,000,000 carat through the early 1980’s.
From the 1980’s and beyond, annual diamond production proliferated exponentially with barely any slowing down from 40,000,000 to 180,000,000 carat in 2005. I would feel safe averaging the annual production for that 25 year period clocking in at 100,000,000 carat per year, that is 20 tons per year or translated to approx. 44,000 pounds of diamonds every year for 25 years. And that’s not including the mere fact that due to their incredible hardness, diamonds are not perishable.
If we really put our thoughts around this fact.., every diamond ever unearthed throughout history has a high probability that it is still in existence somewhere on this planet!! Some thinking materials perhaps.
* just before the publication of this article, De Beers just announced a $20M resurrection of their “A Diamond Is Forever” campaign to promote diamond sales in Q4 in the US and China.
Figure 3 – courtesy of GIA Gems & Gemology Summer 2007
So, Are Colorless Diamonds Rare?
Let me start by mentioning that I do believe some unique natural colored diamonds are genuinely rare, obviously such include the seven colors that make up the spectrum with only an extremely narrow range of the yellow color which by large yellow is quite plenteous in nature!
But in direct contrast to the above, perhaps it’s high time that we start realizing colorless diamonds are not rare by nature. And so their measured values in particular are and should not depend on their material rarity stature…, in fact it’s time to limelight the fact that colorless diamonds are in fact pretty common.., either in their mined or grown status!
Certainly in their colorless subdivision ranges, (e.g. D to Z scale) there are some who can be considered scarcer than others like for example a D colorless diamond might be a bit scarcer than a slightly tinted K-L-M colored diamond but rarity isn’t the word I would use categorically.
And as I have been claiming for years.., it’s time to face the facts that what determines the value of colorless cut & polished diamonds is solely based on what values we add to their materials, value components such as innovations, **lapidary works, jewelry design, craftsmanship and/or the branding that goes into their marketing potentials.
I am not saying mined diamonds dont have value from their core…, they certainly do, just like lab grown diamonds have as well.., both values should be a direct reflection of their genuine production costs. But in my opinion, rarity should definitely not be a measurable component of their values…, mined or grown!
** lapidary works, meaning different from the standard 57 facet brilliant cuts which cover the majority, we should already be well aware today that such common diamond cuts (or alike) do not demonstrate any rarity factors.
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