Lab-Grown Diamonds: Is the Era of Falling Prices Coming to an End?

 

Rising production costs, energy consumption and shrinking margins could change the economics of the lab-grown diamond industry

For several years, the lab-grown diamond industry has been defined by one dominant story: falling prices.

What was once promoted as a lower-cost alternative to natural diamonds has become dramatically cheaper as manufacturers around the world expanded production capacity. In India, which has become one of the world’s major lab-grown diamond manufacturing and polishing centres, the rapid growth in production has created intense competition and severe pressure on margins.

But the economics of the industry may now be reaching an important turning point.

Recent developments in Surat suggest that manufacturers and traders are increasingly concerned that prices and discounts have fallen too far.

At a meeting of the Surat Lab Grown Diamond Association on September 7, industry participants called for greater discipline in pricing and an end to aggressive discounting. Reports from India said polished lab-grown diamond prices had recently increased by approximately 20% to 25%, while traders were reducing discounts from around 7% to approximately 3% to 4%.

This does not necessarily mean that lab-grown diamond prices are about to return to previous levels.

Instead, it may signal something more fundamental: the industry is beginning to confront the cost of actually producing a diamond.

A decade of falling prices

The scale of the price decline has been extraordinary.

According to data reported by the Times of India, India’s average export value for polished lab-grown diamonds fell from approximately US$246 per carat in 2016–17 to around US$60 per carat in 2025–26.

During 2025–26, India exported approximately 18.8 million carats of polished lab-grown diamonds, up substantially in volume, while the total export value fell to approximately US$1.133 billion.

That means the industry was producing and exporting significantly more diamonds while receiving considerably less per carat.

The same report found that the average export value had improved to almost US$69 per carat during April and May 2026, suggesting that the long decline may have started to stabilise.

The latest developments in Surat provide another indication that the market may be attempting to establish a floor.

The problem with selling below cost

The Surat Lab Grown Diamond Association has warned that excessive discounting is damaging manufacturers’ earnings.

Association president Babu Vaghani reportedly said that continued price reductions were reducing manufacturers’ profits and putting pressure on wages.

The concern is straightforward.

A diamond manufacturer has to pay for:

• sophisticated growing equipment
• electricity
• cooling systems
• gases such as hydrogen and methane for CVD production
• diamond seed plates
• maintenance
• skilled technicians
• factory buildings
• financing and equipment depreciation
• cutting and polishing
• grading and certification
• rejected or lower-quality production
• logistics and administration

If the finished diamond is continually sold for less, eventually something has to give.

Manufacturers can reduce margins, reduce wages, reduce investment, reduce production or leave the industry altogether.

Reports from Surat indicate that some polishing units have already considered moving into other industries as prolonged price erosion has reduced earnings and contributed to skilled-worker shortages.

Energy: the hidden cost of a laboratory diamond

One of the most important factors in understanding the future cost of lab-grown diamonds is energy.

Lab-grown diamonds are not simply manufactured like an ordinary consumer product. They are grown under highly controlled conditions using enormous amounts of technology, heat, pressure, vacuum systems, plasma and cooling.

There are two principal technologies used to grow gem-quality laboratory diamonds: HPHT, or High Pressure High Temperature, and CVD, or Chemical Vapour Deposition.

DCLA’s information on synthetic diamonds and laboratory-grown diamond certification explains the technologies used to produce laboratory-grown diamonds and the importance of identifying their origin.

The Gemological Institute of America explains that HPHT involves temperatures of approximately 1,300°C to 1,600°C and pressures exceeding 870,000 pounds per square inch. CVD uses a vacuum chamber, gases and an energy source to create a plasma in which carbon atoms are deposited onto diamond seed plates.

For CVD production in particular, electricity is a critical ongoing input because the reactor, plasma generation, vacuum equipment, pumps and cooling systems must operate for extended periods.

Research into synthetic diamond production has identified electricity as a major environmental and production hotspot for microwave-CVD manufacturing.

The exact electricity consumption varies considerably depending on equipment, efficiency, production scale, cooling systems and operating conditions. Published estimates range from several dozen kilowatt-hours per carat to substantially more in less-efficient systems.

One recent technical analysis estimates modern HPHT production at around 36 kWh per carat under particular operating conditions, while CVD systems can vary substantially, with some commercial systems using around 77 kWh per carat and less-efficient systems exceeding 200 kWh per carat. These figures should be treated as indicative rather than a universal industry standard.

The important point is not one particular number.

It is that electricity is a recurring cost for every diamond produced.

Once a manufacturing plant has been built, the machines still have to run.

Why energy could become a price driver

This is where the economics become particularly interesting.

The initial investment in a laboratory-grown diamond factory is largely a capital cost. The manufacturer buys reactors, presses, vacuum equipment, cooling systems, power infrastructure and other machinery.

Once the factory is operating, however, the manufacturer faces continuing costs.

Electricity is one of them.

Unlike the purchase of a machine, electricity cannot be depreciated away. Every production cycle consumes power.

That means energy prices can have a direct effect on the minimum economic price at which a manufacturer can operate.

If electricity prices increase, production costs rise.

If manufacturers are already operating on very small margins, they may have little ability to absorb those increases.

The effect can be particularly significant for producers using electricity-intensive CVD or HPHT systems for long production cycles.

This creates an important potential turning point for the lab-grown diamond industry.

The lower the selling price becomes, the more important the underlying production cost becomes.

At some point, manufacturers have to decide whether producing another carat is economically worthwhile.

The economics of oversupply

The spectacular fall in lab-grown diamond prices was not caused simply by consumers suddenly deciding that diamonds were worth less.

A major factor has been the expansion of production capacity.

India alone produced more than 3 million lab-grown diamonds in 2023 and accounted for more than 15% of global output, according to India’s NITI Aayog.

Other major production centres, particularly China, also expanded capacity.

The result was a classic supply-and-demand problem.

When production capacity grows faster than consumer demand, manufacturers compete for buyers.

One manufacturer reduces its price.

Another offers a discount.

A trader offers an additional discount.

A broker undercuts another broker.

The process can continue until the market price is significantly below the level manufacturers originally expected.

This is precisely why the recent call from Surat for an end to excessive discounting is significant.

The industry is effectively saying that price competition has gone too far.

DCLA has previously examined this broader transformation in the diamond industry in its article on lab-grown diamonds as a structural disruption to the traditional diamond industry.

The cost floor

Every manufactured product has an economic cost floor.

That does not mean prices can never fall below the cost of production. Companies can sell inventory at a loss, factories can operate below capacity and distressed businesses can liquidate stock.

But those conditions cannot continue indefinitely.

If manufacturers consistently lose money, production capacity eventually disappears.

Machines are switched off.

Investment stops.

Workers leave.

Companies close or move into other businesses.

Supply then begins to contract.

This is potentially what the lab-grown diamond industry is now trying to avoid.

The Times of India reported that persistent price erosion has already forced some polishing units to consider alternative industries and has placed pressure on wages.

Could this lead to higher lab-grown diamond prices?

Possibly — but it is important not to confuse a price stabilisation with a return to the prices of several years ago.

There are still enormous production capacities around the world, and technological improvements can continue to reduce manufacturing costs.

Competition also remains intense.

However, the recent 20% to 25% reported increase in polished prices in Surat, combined with the reduction in discounts from approximately 7% to 3%–4%, suggests that parts of the industry are already attempting to establish greater pricing discipline.

If manufacturers continue to reduce production, consolidate capacity or refuse to sell below sustainable levels, prices could eventually find a stronger floor.

Energy costs could become an important part of that floor.

Why energy matters more as prices fall

There is an interesting economic paradox here.

When lab-grown diamonds were expensive, energy represented only one component of a much larger selling price.

As the selling price falls dramatically, however, every operating cost becomes proportionally more important.

Imagine a manufacturer producing a diamond at a total cost of $100 per carat.

Selling it for $200 leaves room for overheads, financing and profit.

Selling it for $120 leaves very little.

Selling it for $90 creates a loss.

The actual numbers vary enormously between manufacturers, technologies, electricity prices, yields and diamond specifications. Therefore, there is no single industry-wide production cost that can be applied to every lab-grown diamond.

But the economic principle remains the same.

There is a point at which further price reductions stop being sustainable.

The next phase of the lab-grown diamond market

The laboratory-grown diamond industry may therefore be entering a different phase.

The first phase was technological.

Could diamonds be grown commercially in laboratories?

The second phase was expansion.

How quickly could manufacturers increase production?

The third phase was price competition.

How cheaply could those diamonds be sold?

The next phase may be about economics.

How cheaply can a diamond realistically be produced while still providing a sustainable return to the manufacturer?

That question could become increasingly important.

The industry has already demonstrated that laboratory-grown diamonds can be produced at dramatically lower prices than natural diamonds.

What it has not yet demonstrated is where the long-term sustainable price floor lies.

Energy will be one of the factors determining that answer.

So will equipment depreciation, financing, labour, gases, seeds, yields, polishing, grading and the cost of maintaining sophisticated manufacturing facilities.

What this means for consumers

For consumers, lower lab-grown diamond prices have been an obvious advantage.

They have made larger and higher-specification diamonds accessible to a much wider market.

But consumers should also understand that cheap does not necessarily mean the price cannot fall further — and it does not mean the price cannot eventually rise.

The current market is still evolving.

The recent developments in Surat suggest that manufacturers are increasingly unwilling to continue absorbing falling margins and aggressive discounts.

If production is reduced and pricing discipline improves, the market could begin to stabilise.

If energy and other operating costs rise at the same time, those costs could become increasingly important in determining the minimum sustainable price of a lab-grown diamond.

The DCLA view

For consumers, the most important point remains understanding exactly what they are buying.

A laboratory-grown diamond is a real diamond with essentially the same chemical composition and crystal structure as a natural diamond, but its origin is different.

DCLA’s recent article, Natural or Laboratory-Grown? How Can You Tell What Diamond Is in Your Ring?, explains why laboratory-grown and natural diamonds can be difficult to distinguish visually and why independent laboratory testing is important.

DCLA recommends independent diamond identification and certification where appropriate, particularly when establishing whether a diamond is natural or laboratory-grown.

The DCLA Diamond Grading Report records important characteristics including carat weight, colour, clarity, measurements, treatments and whether the diamond is natural or laboratory-grown.

The laboratory-grown diamond industry has undergone an extraordinary period of technological development and price compression.

The next question is whether it can achieve something arguably more difficult:

long-term economic stability.

If manufacturers can no longer operate profitably at today’s heavily discounted prices, and if energy and other production costs continue to rise, the economics of the industry suggest that prices may eventually have to move higher or production capacity will have to contract.

The recent events in Surat may be an early indication that this process has already begun.

Classic Diamonds, Reimagined: How Modern Jewellery Design Is Bringing Old Favourites Back to Life

 

Some jewellery designs never truly go out of fashion.

Diamond tennis bracelets, rivière necklaces, diamond studs and classic pendants have remained among the most recognisable and enduring pieces in fine jewellery. Their appeal is easy to understand: they are elegant, versatile and can be worn for almost any occasion.

But today’s jewellery customers are increasingly looking for something more than a traditional piece. They want the beauty and familiarity of classic diamond jewellery while incorporating a more contemporary style that reflects their individual personality.

This is creating an interesting new direction in jewellery design: reimagining the classics rather than replacing them.

For customers considering a completely individual piece, DCLA also offers Bespoke Jewellery services, combining traditional diamond knowledge with contemporary design.

The return of the classics with a modern attitude

A traditional diamond rivière, for example, has historically been associated with formal occasions and evening wear. Today, the same concept can be transformed into something far more relaxed and versatile.

A diamond necklace can be worn with a simple shirt and jeans just as easily as with an evening gown. A tennis bracelet can be worn on its own for understated elegance or combined with gold bracelets, watches and other pieces to create a layered, contemporary look.

Diamond studs are also being reinvented. Instead of simply choosing two traditional round brilliant diamonds, customers are increasingly considering pear, marquise, princess, oval and other shapes, as well as modern settings and designs that give the classic stud a completely different appearance.

DCLA’s Diamond Shape guide provides information on the many different shapes available and how they influence the appearance and character of a diamond.

According to Michael Cohen, designer at the DCLA Diamond Exchange in Sydney, this shift reflects a broader change in the way people think about jewellery.

“The classic diamond has never lost its appeal. What is changing is the way people want to wear it. Customers are looking for jewellery that feels personal and contemporary while still having the quality and timelessness associated with traditional diamond jewellery.”

Layering creates individuality

One of the biggest changes in modern jewellery styling is the popularity of layering.

Instead of wearing a single necklace, bracelet or ring, customers can combine several pieces of different lengths, textures and designs.

A classic diamond necklace might be worn alongside a fine gold chain. A tennis bracelet can sit next to a watch or be stacked with plain gold and gemstone bracelets. Several delicate rings can be combined to create a look that changes from day to day.

This approach allows a traditional diamond piece to become part of a much more relaxed wardrobe.

The beauty of layering is that there are no strict rules. A customer can combine old and new, understated and extravagant, polished and casual.

Changing the diamond shape changes the entire look

The modernisation of classic jewellery is not limited to the setting. The diamonds themselves can dramatically change the character of a piece.

Round brilliant diamonds remain enormously popular, but fancy shapes such as oval, pear, marquise, emerald, princess and baguette cuts can give traditional jewellery a very different personality.

A rivière made entirely from round diamonds has a very different appearance from one incorporating graduated oval or emerald-cut stones.

Similarly, a tennis bracelet using pear-shaped diamonds can create a softer, more flowing appearance, while baguette diamonds can produce a sharper and more architectural design.

This gives designers enormous scope to create jewellery that is recognisably classic while still appearing completely modern.

DCLA’s Natural Diamond Search allows customers and industry professionals to explore diamonds by shape, including round, oval, pear, emerald, princess, radiant, marquise, baguette and many other shapes.

Colour can make a classic piece contemporary

Another increasingly popular design approach is the use of contrasting metals and subtle touches of colour.

Platinum or white gold can provide a clean, contemporary background for diamonds, while yellow gold can introduce warmth and contrast.

Coloured gemstones can also be incorporated into otherwise traditional diamond jewellery. A single sapphire, ruby or emerald can become a focal point within an otherwise diamond-dominated design.

Even small details can make a significant difference.

A traditional diamond bracelet with an unusual clasp, mixed-metal elements or a distinctive arrangement of diamond shapes can feel like an entirely new creation.

For coloured diamonds and unusual diamond characteristics, understanding the stone itself is particularly important. DCLA’s Diamond Certification service records important characteristics including colour, clarity, carat weight, proportions and other identifying features.

Jewellery designed to be worn, not stored

Perhaps the most important change is the attitude towards when fine jewellery should be worn.

For generations, diamonds were often associated with weddings, anniversaries, special celebrations and formal events. Modern customers are increasingly choosing to wear their fine jewellery as part of everyday life.

A beautiful diamond bracelet does not necessarily need to wait for a black-tie event.

Worn with denim, a simple shirt, a watch or casual clothing, a classic diamond can provide a subtle touch of luxury without appearing overly formal.

This makes versatility an increasingly important part of jewellery design.

The importance of timeless design

There is also a practical reason why classic designs continue to attract customers.

Fashion changes quickly. Jewellery can be expensive, and customers naturally want pieces they will continue to enjoy wearing for many years.

A completely trend-driven design may look spectacular today but can become dated as fashions change. A well-designed classic, however, can remain relevant while allowing the owner to style it differently over time.

A properly documented diamond can also provide important information for the owner over the years. DCLA’s Diamond Grading Report records the diamond’s technical characteristics, including carat weight, colour, clarity, measurements, cut, symmetry, polish and whether the stone is natural or laboratory-grown.

The importance of knowing what you are buying

Modern jewellery design also means consumers have more choices than ever before.

Natural diamonds and laboratory-grown diamonds can both be used to create beautiful jewellery, but they are different types of diamond and should be correctly identified and represented.

DCLA provides grading and certification for both natural and laboratory-grown diamonds, with its laboratory using advanced technology to identify and assess diamonds.

For customers purchasing a new piece or redesigning an existing one, independent grading can provide useful documentation about the diamond being used.

DCLA’s Technology & Grading Process explains how diamonds are examined and graded using a controlled, independent process.

Jewellery that can become part of a family’s story

One of the unique qualities of fine diamond jewellery is its ability to move between generations.

A bracelet purchased today may eventually be worn by a daughter or granddaughter. A pair of diamond earrings can be redesigned, reset or incorporated into another piece as styles and personal preferences change.

This is one reason classic diamond jewellery continues to have such enduring appeal.

Rather than thinking of a piece as something that belongs to one particular fashion period, a well-designed diamond jewel can become part of a family’s history.

For an existing family piece, professional examination and documentation can also help an owner understand what they have. DCLA provides Diamond and Jewellery Valuation services as part of its broader range of diamond and jewellery services.

The new classic

The future of fine jewellery may not be about choosing between traditional and contemporary design.

Instead, it is about combining the two.

The timeless appeal of diamonds, combined with modern cuts, creative settings, mixed metals, layering and personalised design, gives today’s customers far more ways to express themselves.

The result is what could be called the new classic: jewellery that respects the designs of the past while being created for the way people live today.

For customers considering a new diamond piece, the message is simple. A classic design does not have to look old-fashioned. With the right design approach, a traditional diamond can be transformed into something contemporary, personal and uniquely your own.

At the DCLA Diamond Exchange in Sydney, the combination of diamond expertise, independent grading and bespoke jewellery knowledge provides customers with the opportunity to take a traditional idea and give it a completely modern interpretation.

Whether it is a family heirloom being redesigned, a classic diamond being incorporated into a new piece, or an entirely new creation, the best modern jewellery does not abandon tradition.

It reinvents it.

The Rise of the Luxury Watch: When Time Becomes an Investment

 

There was a time when buying a high-end watch was simply about owning something beautifully made. Today, for many collectors, a luxury watch is much more than a way of telling the time. It can be a statement of achievement, a piece of craftsmanship, a collector’s item and, when chosen carefully, a wearable asset.

From Rolex and Omega to Audemars Piguet, Vacheron Constantin and Patek Philippe, the world of fine watchmaking has developed into a global market where certain models can command extraordinary prices and maintain strong demand for years.

The names that define luxury watchmaking

Few names carry the prestige of Rolex. Models such as the Submariner, Daytona, GMT-Master II and Day-Date have become icons, recognised well beyond the traditional watch-collecting community.

Audemars Piguet, particularly with the Royal Oak, occupies another level of luxury watchmaking. Its distinctive design and highly regarded mechanical movements have made it one of the world’s most recognisable collector watches.

Then there is Patek Philippe, a name synonymous with traditional Swiss watchmaking. Its philosophy has always been centred on craftsmanship, exclusivity and longevity. Patek Philippe itself distributes watches through its authorised network, with availability dependent on the individual retailer and model.

Vacheron Constantin, one of Switzerland’s great historic manufacturers, appeals strongly to collectors who appreciate exceptional finishing and watchmaking heritage.

And then there is Omega. From the Speedmaster’s association with NASA and the Moon landing to the Seamaster’s long-standing reputation as a professional dive watch, Omega combines history, engineering and everyday wearability.

Other names including Cartier, Jaeger-LeCoultre, IWC, Panerai, Breitling, Tudor, Blancpain and Zenith have also established important places in the luxury-watch market.

A watch you can actually wear

Perhaps the greatest attraction of a luxury watch is that, unlike many traditional investments, you can enjoy it every day.

A share certificate stays in your portfolio. A property remains on the balance sheet. A luxury watch can be on your wrist.

That makes the concept of a wearable investment particularly appealing.

Of course, there are no guarantees. Not every luxury watch increases in value, and buying a watch purely because you expect it to appreciate can be risky. Model, reference, condition, rarity, provenance, box and papers, servicing history and market demand can all influence future value.

But certain watches have demonstrated remarkable resilience because collectors continue to want them.

The current market also shows how strongly the high end of Swiss watchmaking continues to attract collectors. Recent industry analysis indicates that value growth has become increasingly concentrated in ultra-luxury and highly sought-after timepieces, while the broader market has been more mixed.

The authorised retailer: The traditional way to buy

For many buyers, purchasing directly through an authorised retailer remains the ultimate luxury experience.

You get the brand environment, expert advice, manufacturer’s warranty and the knowledge that you are purchasing a genuine new timepiece through the manufacturer’s official distribution network. Rolex, for example, states that new genuine Rolex watches are sold exclusively through Official Rolex Retailers.

There is, however, one significant drawback.

You may have to wait.

For some of the most desirable models, availability can be extremely limited. The watch you want may not simply be sitting in a display cabinet waiting for the next customer.

You may register your interest, develop a relationship with the retailer and wait for the right allocation. Depending on the model and circumstances, that wait can be lengthy.

And that creates an interesting dilemma.

Do you wait years for the opportunity to buy the exact watch you want new?

Or do you find the watch now?

The rise of the specialist watch dealer

This is where the specialist secondary-market dealer has changed the way collectors buy luxury watches.

Rather than waiting indefinitely for a particular allocation, collectors can purchase an existing watch that has already entered the market.

One Sydney business that has embraced this model is The Watch Business, founded and operated by Dmitri.

Based in the Sydney CBD, The Watch Business specialises in pre-owned luxury watches and deals in brands including Rolex, Omega, Audemars Piguet, Patek Philippe, Vacheron Constantin, Cartier and many others. The business operates by private appointment and says its watches are inspected and authenticated by a professional watchmaker before being offered for sale.

For the collector, the attraction is simple:

If the watch you want is available, you don’t necessarily have to wait years to own it.

And that has fundamentally changed the buying experience.

From new to pre-owned and from one watch to another

Perhaps the biggest evolution is not simply the ability to buy a watch. It is the ability to trade.

Collectors rarely stay with one watch forever.

You might start with an Omega Speedmaster. A few years later, you decide you want a Rolex Submariner. Eventually, you might aspire to an Audemars Piguet Royal Oak or a Patek Philippe.

Traditionally, moving between watches could mean selling your existing watch privately, negotiating with buyers, waiting for payment and then starting the search for the next piece.

A specialist dealer can simplify that process.

The Watch Business, for example, offers buying and trade-in services, allowing clients to use an existing watch as part-payment towards another timepiece.

That creates a completely different way of thinking about collecting.

Instead of asking, “How much will my next watch cost?”

The collector can ask:

“What is my current watch worth, and what does it cost me to move up to the next one?”

That difference is significant.

The great advantage of the specialist dealer

There is another important distinction between the traditional retail model and the specialist dealer.

A traditional authorised watch retailer’s primary business is selling the manufacturer’s watches. It is not necessarily a place where you can walk in with your existing Rolex, Omega or Patek Philippe and negotiate a trade against another brand or model.

A specialist dealer operates in a different ecosystem.

They buy watches.

They sell watches.

They trade watches.

They source watches.

And, importantly, they can provide a market for the watch you already own.

This is one of the major limitations of the traditional retail experience: the store where you purchased a new watch may not be the same place that will buy it back from you or trade it towards your next watch.

That is where specialist dealers have carved out an increasingly important role.

The collector’s choice

For someone who has the time and patience, buying from an authorised retailer can be a wonderful experience.

You get the new-watch presentation, manufacturer’s warranty and the satisfaction of being the original owner.

But if you have decided exactly which watch you want and you don’t want to wait potentially years for availability the specialist dealer offers another route.

You can inspect the watch, establish its condition and provenance, understand its market value and potentially walk away with the watch you have been searching for.

And when you eventually decide to upgrade, you can return to the same market and trade your existing piece towards something different.

That makes luxury-watch collecting increasingly fluid.

A changing definition of investment

The luxury watch market has changed dramatically.

The modern collector isn’t necessarily buying one watch and keeping it locked away in a safe.

They may buy a watch, wear it, enjoy it, trade it, upgrade it and eventually move into another piece.

That is what makes a great luxury watch so interesting.

It can be craftsmanship, jewellery, history, status and a potentially valuable asset all on your wrist.

For today’s discerning collector, the question is no longer simply:

“What watch should I buy?”

It is increasingly:

“What watch should I own next?”

And with specialist dealers such as The Watch Business changing the way Australians buy, sell and trade luxury timepieces, building a collection has never been more accessible.

For collectors who value experience, expertise and the ability to trade one exceptional timepiece for another, this has quickly become a compelling alternative to the traditional retail model.

Source: DCLA