Thursday, October 3, 2024

Pandora’s Lab-Grown Sales Soar As Diamond Industry Faces Market Shake-Up

The diamond industry is experiencing a seismic shift as lab-grown diamonds increasingly capture market share, threatening the traditional mined diamond sector. According to a recent report from Morgan Stanley, lab-grown diamonds comprised approximately 14.3% of the total diamond supply last year, with an impressive 16 million carats compared to the 112 million carats sourced from mines. This trend reflects a broader transition from high-value, low-volume sales to a high-volume, lower-value model.

Morgan Stanley projects that the lab-grown segment will further expand, anticipating it will represent 18% of the market this year and climb to 21.3% by next year. Much of this growth is attributed to increased production in China, which produced 9.3% of the lab-grown supply last year and is expected to rise to 12.7% this year. India remains a significant player, contributing 2.9% of the lab-grown supply.

The rapid rise of lab-grown diamonds is evident when reviewing the market landscape since 2020, when they held only 7.5% of the market share. Morgan Stanley notes, “The trend of increasing lab-grown diamond market share remains unchallenged, adding to the structural challenges faced by the natural diamond market.”

In contrast, mined diamond supply peaked in 2017 at 151 million carats and has since declined to an estimated 112 million carats this year. Despite a slight recovery, the future growth of mined diamonds is expected to be modest, with an annual growth rate of only 1.8% projected through 2025.

Retail chains like Pandora exemplify the surging demand for lab-grown diamonds, reporting an 88% increase in sales of their Essence range in the second quarter of this year. However, the competition in the lab-grown sector is intensifying, leading to price pressures that prompted De Beers’ Lightbox brand to halt its lab-grown diamond production.

The overall diamond market remains cautious, particularly among consumers in the U.S. and China. India, the heart of the diamond cutting and polishing industry, saw a month-on-month decline in exports of 11% in July, with a year-on-year drop of 23%. This downturn signals ongoing destocking among mid-stream producers.

While there is hope for market rebalancing to stabilize prices, analysts caution that a significant price recovery is unlikely before 2025.

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Alice
Alice
Alice is a seasoned jewelry designer renowned for her exquisite creations that seamlessly blend artistry with elegance. With a passion for craftsmanship and an unwavering commitment to quality, Alice has established herself as a distinguished figure in the world of fine jewelry. Drawing inspiration from diverse cultures and artistic movements, Alice brings a unique perspective to her designs, creating pieces that transcend mere accessories to become timeless works of art. Her meticulous attention to detail and insistence on using only the finest materials ensure that each creation reflects not only her artistic vision but also a commitment to unparalleled craftsmanship. Having honed her skills through years of dedicated practice and a keen understanding of evolving trends, Alice is adept at translating her clients' desires into bespoke, one-of-a-kind pieces. Her portfolio encompasses a range of styles, from classic and timeless to avant-garde and contemporary, showcasing her versatility and ability to cater to a diverse clientele.

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