Diamonds – Forever or Unsustainable?

 

It’s no secret that diamonds are among the most expensive jewels on earth. True, diamond dust and low-quality stones also have their place as industrial necessities; their supreme hardness makes them ideal to cut glass and grind metals for innumerable purposes. Their function as a supreme jeweler’s stone has also been around for centuries. These brilliant stones are simply carbon compressed over millions of years, which are today valued in terms of size (carats) as well as for cut, clarity, and color. Coal under extreme pressure, you might say. Very old coal.

Brilliant.com traces their history: The earliest diamonds were found in India in 4th century BC, although the youngest of these deposits were formed 900 million years ago. A majority of these early stones were transported along the network of trade routes that connected India and China, commonly known as the Silk Road… Diamonds were worn as adornments, used as cutting tools, served as a talisman to ward off evil, and were believed to provide protection in battle…

Until the 18th century, India was thought to be the only source of diamonds. When the Indian diamond mines were depleted, the quest for alternate sources began. Although a small deposit was found in Brazil in 1725, the supply was not enough to meet world demands… In 1866, 15-year-old Erasmus Jacobs was exploring the banks of the Orange River [in South Africa] when he came across what he thought was an ordinary pebble but turned out to be a 21.25-carat diamond. In 1871, a colossal 83.50-carat deposit was unearthed on a shallow hill called Colesberg Kopje. These findings sparked a rush of thousands of diamond prospectors to the region and led to the opening of the first large-scale mining operation which came to be known as the Kimberly Mine…

The use of rings as a symbol of commitment dates back to ancient history, specifically to the betrothal (truth) rings of the Romans… The history of the engagement ring began in 1215, when Pope Innocent III, one of the most powerful popes of the Middle Ages, declared a waiting period between a betrothal and the marriage ceremony. The rings were used to signify the couple’s commitment in the interim… The first recorded presentation of a diamond engagement ring was in 1477, when Archduke Maximilian of Austria proposed marriage to Mary of Burgundy. Although engagement rings were common at this time, diamonds were a rarity and were reserved for royalty and the upper elite class…

In 1947, DeBeers [a company formed in 1880 to control the diamond trade] commissioned the services of leading advertising agency N.W. Ayer, and the slogan ‘A diamond is forever’ was coined. The premise of this large-scale marketing campaign was the suggestion that diamonds should be the only choice for engagement rings. The DeBeers advertising campaign was wildly successful, and was a contributing factor to today’s widespread embracing of the tradition of diamond engagement rings. In today’s fine jewelry market, more than 78% of engagement rings sold contain diamonds.

While younger generations are less obsessed with diamonds as a token of love, commitment and marriage, the value of diamonds continues to skyrocket. But there’s a new kid in town: the manufactured diamond. In the 1950s, scientists were beginning to experiment with high-pressure hydraulic machines that could turn ordinary coal into diamonds. They needed massive amounts of energy, and most of the earliest products were relegated to industrial uses.

In the last few years, “lab-grown” (from coal) diamonds have been created with amazing color and clarity, using one of two processes: High pressure high temperature (HPHT – left above) and chemical vapor deposition (CVD – right above). They are much less expensive than natural stones, but: “Social media posts show millennials and Gen Zs proudly explaining the purchase of their lab-grown diamonds for sustainability and ethical reasons. But how sustainable they are is questionable, since making a diamond requires an enormous amount of energy and many major manufacturers are not transparent about their operations…

“In the United States, one company, VRAI, whose parent company is Diamond Foundry, operates what it says is a zero-emissions foundry in Wenatchee, Washington, running on hydropower from the Columbia River. Martin Roscheisen, founder and CEO of Diamond Foundry, said via email the power VRAI uses to grow a diamond is ‘about one-tenth of the energy required for mining.’” Associated Press, February 13th.

Most of these “synthetic” diamonds are made in India, and while the ads for the finished products tout words like “sustainable” and “environmentally friendly,” virtually all of the Indian stones are manufactured using massive amounts of coal-fired electricity. The same is true of manufactured diamonds from China. While there are changes to some plants – such as India’s Greenlab Diamonds that use solar renewables in their manufacturing processes – most manufactured diamonds are monster users of electricity. Some of these machines keep the relevant coal-in-transition in the machines for weeks at a time, continuously using electricity.

Needless to say, dealers in traditional stones are fighting back before the entire diamond industry devolves into a commoditized world of cheap stones (which usually bear a microscopic label disclosing their manufactured heritage). Experts can distinguish between the natural and manufactured stones, using lasers to pinpoint telltale signs in atomic structure. “With lower prices for lab-grown and young people increasingly preferring them, the new diamonds have cut into the market share for natural stones. Globally, lab-grown diamonds are now 5% to 6% of the market, and the traditional industry is not taking it sitting down. The marketing battle is on.

“The mined diamond industry and some analysts warn lab-grown diamonds won’t hold value over time… ‘Five to 10 years into the future, I think there’s going to be very few customers that are willing to spend thousands of dollars for a lab diamond. I think almost all of it’s going to sell in the $100 price point or even below,’ said [diamond expert Paul] Zimnisky. He predicts that natural diamonds will continue to sell in the thousands and tens of thousands of dollars for engagement rings… Paying thousands of dollars for something that drops most of its value in just a few years can leave the buyer feeling cheated, which [industry analyst Edahn] Golan said is an element that is currently working against the lab-grown sector.” AP But who can actually tell the difference… except experts with their special tools? Investment or cosmetic glory? You choose.

I’m Peter Dekom, and perhaps this little “out of left field” blog just might save you a few thousand dollars someday.