Analysis: the state of the diamond industry

Danielle Max

New York–Although there is no way of knowing how many undisclosed lab-grown diamonds are circulating, analyst Chaim Even-Zohar estimates approximately $750 million worth of gem-quality man-made diamonds entered the supply chain in 2016. 
He describes the volume of undisclosed lab-grown melee—diamonds sized from a miniscule 0.001 carats to 0.18 carats used in every type of jewelry—entering the market as “staggering.”

Others also believe there is a reasonable likelihood of discovering undisclosed lab-grown stones in the pipeline.

Based on our experience of testing jewelry and parcels, we suspect the risk of finding synthetics in the supply chain is reasonably high at the moment,” says Tom Moses, executive vice president and chief laboratory and research officer at the Gemological Institute of America.
Just one high-profile case of a consumer discovering the expensive ring they saved up for contained an undisclosed lab-grown diamond could have huge ramifications for consumer trust in an industry already working hard to stay relevant to millennials.

It is bound to happen before too long and, in fact, it probably already has.

David Skuza of DRC Techno, a Surat, India-based gemological research and development company founded by sightholder Dharmanandan Diamonds, says every customer who has used the company’s J-Secure Plus machine has found undisclosed lab-grown diamonds.

One customer recently tested a fancy diamond bracelet with rounds and baguettes. They discovered the baguettes to be lab grown, a big surprise.

Every retailer, manufacturer, wholesaler and diamond company that has tested or bought our machine finds undisclosed lab-grown diamonds. High-end or mass-market, it makes no difference. The contamination is everywhere.”

He has endless examples of this “contamination.

They include a gem lab, which Skuza will not publicly identify for confidentiality reasons, that quality controls more than 1,000 stones on a weekly basis for a major reseller and regularly finds more than 5 percent of its diamond products containing undisclosed man-made diamonds.

He also cites an example in which a customer checking a 5-carat parcel of 0.02-carat diamonds at the recent JCK Las Vegas show discovered that nearly 75 percent of the diamonds he had just purchased were man-made.

Taking action

Although the battle against undisclosed lab-grown diamonds feels a bit like fighting terrorism—those who want to cause disruption are always one step ahead of those seeking to curtail it—the industry is far from powerless.

Manufacturers and dealers should use all the means at their disposal to stem the flow of undisclosed lab-grown stones further down the supply chain. But, retailers must also do their part to prevent these stones from ending up in the hands of unsuspecting end consumers.

Jonathan Kendall, president of the International Institute of Diamond Grading & Research (IIDGR), a De Beers Group company, says the first piece of advice for retailers who suspect they might have received undisclosed lab-grown diamonds is not to panic.

The second is to review what safeguards they have in place regarding the products they sell, noting that, “Every individual business is responsible for the integrity of its merchandise.”

Read full article

Source National Jeweler