MAKING HISTORY: De Beers will sell diamonds made in a lab

Daniel Fowler
May 31, 2018

De Beers plans to invest $94 million over four years to build an Element Six factory near Portland, in the USA state of OR, which should produce more than half a million rough carats a year when fully operational in about 2020.

These unnatural gems - which cost 90% less than their billion-year-old organic brethren - are a desperate De Beers attempt to retain diamond dominance in spite of shifting consumer preferences. The diamonds will be marketed in the United States under the name Lightbox, a fashion jewelry brand, and sell for a fraction of the price of mined gems.

"The line will bring something new and innovative to the jewelry sector, featuring pink, blue and white lab-grown diamonds in a selection of accessibly-priced earring and necklace designs", De Beers said in a release.

It has developed machines for its clients to quickly distinguish natural diamonds from synthetic ones as a way to challenge the encroachment of synthetic diamonds into diamond jewellery. Sold exclusively online at first, the pieces start at $200 (£150) for 0.25 carat, and go up to $800 (£600) for a one-carat diamond, plus $100 for a silver setting and $200 for 10ct gold. Company executives vowed never to sell artificial stones, and it participated in the diamond industry's "real is rare" campaign.

In a significant about-face, the company announced Tuesday it is getting into the synthetic diamond game with Lightbox, its new man-made diamond brand that will offer full carat stones from roughly $800 beginning in September. Today's 20- and 30-somethings - bogged down by heavy student debt loads and stagnant wages - have less spending power than their predecessors did, but they have different values, too: A recent study by De Beers found that millennials would rather splurge on overseas holidays, weekend getaways and electronics than on diamonds. The average selling price per rough diamond carat fell 13% to $162.

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The line of man-made diamonds "may not be forever, but is ideal for right now", Bruce Cleaver, chief executive of De Beers Group, said in a statement. But their chemical makeup is the same (all diamonds are made of just one element: carbon), and experts say they are indistinguishable to the naked eye.

The above process makes particles that can ultimately crystallise into diamonds in 10 weeks.

De Beers has produced synthetic diamonds for years through a subsidiary called Element Six, but it has limited their use to industrial applications. When it is up and running the factory will be able to produce more than 500,000 carats of diamonds a year.

Still, De Beers' bet is that people won't want to seal an engagement deal with something whose price makes it feel little better than costume jewelry. That compares with lab production of less than 4.2 million carats, according to Bonas & Co.

Yesterday, De Beers said it had extensive talks with Botswana about the decision to sell man-made diamonds and the country supports the move.

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