- De Beers is launching a new company that will sell lab-grown diamonds.
- These "affordable" man-made diamonds are targeted at price-conscious millennials.
- Lab-grown diamonds are created by placing a tiny fragment of a diamond (a "carbon seed") in a microwave with varying amounts of carbon-heavy gas.
The world's largest diamond miner just confirmed that the impact of lab-grown diamonds is real.
De Beers, which controls about 30% of the world's supply of mined stones and has vowed in the past never to sell artificial stones, announced on Tuesday that it would be launching a new company that will exclusively sell lab-grown diamonds.
This is a historic moment for the company and goes against everything it had formerly said about man-made stones.
"De Beers' focus is on natural diamonds," Simon Lawson, the current head of research and development at De Beers, told Bloomberg in 2015, CNN Money reported. "We would not do anything that would cannibalize that industry."
The new company, called Lightbox Jewelry, is aimed at millennial shoppers who are increasingly choosing to buy alternative kinds of diamonds for socially and economically concious reasons. The jewelry, which will be available to buy starting in September, costs between $200 for a quarter-carat stone to $800 for a one-carat stone.
According to a Morgan Stanley report cited by Forbes, lab-grown diamonds could take 7.5% of the total market share by 2020.
In a statement about Lightbox Jewelry, De Beers CEO Bruce Cleaver positioned these diamonds as an affordable alternative — one that is not "forever" but that is ideal for "right now," he said.
Lab-grown diamonds have a very similar appearance to mined diamonds. The stones are made from a tiny diamond fragment and have the same physical structure and chemical composition as a diamond that has been mined from the ground. The so-called diamond "seed" is put inside a microwave plasma oven and blasted with superheated natural gases. The gas then sticks to each seed to create a plasma ball and slowly builds up the diamond.
This process can take anywhere from 10 to 12 weeks.
In order to distinguish what would be "invisible to the naked eye but easily identified under magnification," Cleaver said that De Beers' lab-grown diamonds will carry a permanent logo on the stone.
Cleaver said that the price of this jewelry will be much more accessible than other manufacturers' and will come in more adventurous colors.
"Our extensive research tells us this is how consumers regard lab-grown diamonds — as a fun, pretty product that shouldn't cost that much — so we see an opportunity here that's been missed by lab-grown diamond producers," he said in a statement.
It's not just the lower price of lab-grown diamonds that is resonating well with value-hungry millennials. These diamonds also play to another one of millennials' preferences, and that is that they want to shop for socially conscious products. They can sleep easy when opting for lab-grown diamonds, which have no risk of being blood diamonds.
