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Diamonds were never rare. For a century, the belief that they were was the only thing actually being sold. |
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One Number
More than 60% of US engagement ring diamonds are now lab grown. Alexis Nasard, Swarovski CEO / Financial Times, August 2026 A decade ago that figure was in the single digits. Nasard expects it to hit 80% within two years. Meanwhile, wholesale lab-grown diamond prices have fallen roughly 80% while natural diamond prices are down closer to 20%, according to Paul Zimnisky's Global Polished Diamond Price Index. |
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One Argument Diamonds stopped being scarce more than 150 years ago. Everything that happened to the price after that was supply management, not geology.Geological scarcity ended in 1870. Before that, diamonds surfaced only in a handful of riverbeds in India and the jungles of Brazil. Then prospectors found deposits near South Africa’s Orange River, and diamonds were, to quote journalist Edward Jay Epstein’s account for The Atlantic in 1982, “being scooped out by the ton”. The US Geological Survey put 2023 global gem-quality diamond production at roughly 74 million carats, making it an industrial commodity, not a rare find. The supply manager was De Beers, which through its Central Selling Organisation controlled an estimated 80-90% of the global diamond trade at its peak in the late 1980s and 1990s, according to diamond analyst Paul Zimnisky. It was buying up outside production specifically to keep abundant supply from reaching buyers and crashing the price. That share had already fallen below 60% by 2000 and to roughly 35% by 2018, even before lab-grown diamonds existed in commercial volume. The second part of the mechanism was psychological. In 1947, commissioned by De Beers to counter sliding postwar sales, copywriter Frances Gerety wrote “A Diamond Is Forever”. Its real function, according to Epstein, was to make resale feel wrong. No secondary market means no price discovery. For 70 years nobody could hold a diamond and see what it was actually worth. Lab-grown diamonds are an alternative to compare against. Chemically identical, often graded by the same laboratories, they are now priced around $100 a carat wholesale against thousands for the mined equivalent. For the first time in a century the average buyer has something to check the story against. However, buyers who still choose mined ones are spending more, not less. Average spend on natural-diamond jewellery rose 25% between 2023 and 2025, according to De Beers London. Clients increasingly favour visibly imperfect “naturally included” stones specifically because the imperfection signals the diamond was not grown in a lab, says designer Michelle Oh. Genuine connoisseurs are paying for verified origin the way collectors pay for provenance in art or wine. But these are buyers who never believed in the scarcity story. They just wanted the real thing regardless of price. The 60% (soon 80%) who now choose lab-grown are people who stopped believing the scarcity and “forever” tale the moment they could check.
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One Position Treat any premium priced on “rarity” as a claim to test, not a fact to accept. This should be the approach towards anything in your own portfolio, boardroom, or client pitch that leans on the word “exclusive” rather than on a difference you could actually verify. I would be wrong about this if a genuine substitute existed for one of your rare holdings and the price still did not move. That is real scarcity. And it is rarer than most sellers want you to think. What is something being pitched to you right now — or something you already own — whose price depends on a scarcity story you have never actually tested? |
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