The entry of the fashion jewelry giant, Pandora, into the lab-grown diamond market, is likely to raise the product’s profile in the marketplace.
On August 16, the Danish fashion jewelry brand, Pandora announced that it will be launching a laboratory-grown diamond jewelry collection in the United States and Canada less than 10 days later. Echoing its now well used theme of environmental responsibility, that company said that all the items being produced will also incorporate recycled silver and gold.
Pandora’s 33-piece Brilliance collection will include rings, necklaces, bangles and earrings, set with man-made diamonds, which the firm promises have been created using 100 percent renewable energy.
The launch of the collection in North America comes on the heels of what evidently had been a successful pilot project in the United Kingdom. When that kicked off, Pandora had stated that it would henceforth stop using mined diamonds in its jewelry. That declaration greeted with a fair degree of derision, because as a fashion jewelry producer it had to date hardly used diamonds at all. Indeed, its decision to incorporate laboratory-grown diamonds meant that it most probably was cutting down on its use of cut crystal glass.
That, aside, the very public entry of a major fashion brand into the laboratory-grown diamond jewelry sector carries is significant, certainly in terms of the way that the public perceives of the product. Pandora targets a different consumer profile to Tiffany’s, for example, but its presence in the market still means that lab-grown goods will gain greater acceptance, and the fashion jewelry company could eventually become a force in bridal jewelry.
LGD EXPORTS TO DOUBLE
The one country where the industry is clearly rethinking its position on laboratory-grown diamonds is India. Not only is the country a fast-growing center for laboratory-grown diamond production, but it was one of the first centers to formalize the laboratory-grown diamond trade. Already in December 2020, the Indian Gem & Jewellery Export Promotion Council (GJEPC) introduced a new membership category for laboratory-grown diamond traders, and the Bharat Diamond Bourse approved the trading of lab-grown diamonds at its facility.
It should be noted that the diamond Indian cutting sector, which already today process more than 90 percent of the finished diamonds produced each year, stands to benefit significantly from the influx of synthetically produced goods, which do not differ from natural goods in the way that they are polished.
Mumbai’s diamond exchange, the Bharat Diamond Bourse formally recognized the lab-grown diamond trade in December 2020.
It is expected that exports of polished lab-grown diamonds from India may double during the financial year that began on April 1, from $1.3 billion worth the prior financial year. This compares to exports worth almost $24 billion of polished natural diamonds during the past financial year.
“We have a huge potential to grow exports to $7 billion-$8 billion in the next few years on the back of U.S. demand and acceptability in the UK and Australia,” stated Vipul Shah, vice chairman of the Gem & Jewelry Export Promotion Council, speaking to a media outlet.
“It is going to be treated as a fashionable jewelry, which is affordable to the youngsters, and that’s the way the market is going to shift,” he said.
The State Bank of India has announced that it tentatively will begin financing the laboratory-grown diamond sector.
LIMITED LDG FINANCING NOW AVAILABLE
Another fixture of the Indian diamond and jewelry industry looking close at the lab-grown sector is the banks.
The State Bank of India recently announced that it had formalized a policy to fund units engaged in manufacturing of lab-grown diamonds, but with strings attached. It is the first Indian bank to openly have done so.
“The man-made diamond lobby is becoming stronger by the day,” said an unnamed industry source, speaking to India’s Economic Times. “Though volumes are still a fraction of natural diamonds, SBI probably thinks it is an emerging business. With the pandemic and decline in affordability, demand for lab-grown stones has improved.
SBI is still treading very carefully, with only two branches handling the new business, including the Diamond Bourse branch in Mumbai’s Bandra Kurla Complex and its commercial branch in Surat. Initially no working capital will be financed by the bank, but rather purchases of machinery for the production of lab-grown stones.