Growing bona fide diamonds inside a laboratory instead of retrieving the ancient stone from the earth sounds like cutting-edge technology but it actually dates back to 1953, when De Beers made the first lab-grown diamond. It went on to commercialise production for industrial use out of SA in the 1960s.
In the early 2000s, others sought to make diamonds for the jewellery market. But making inroads into the traditional diamond business, in effect largely controlled by De Beers, has been a hard slog. Only recently, with backing from celebrities such as actor Leonardo DiCaprio, has the profile of man-made diamonds been raised.
Then, three months ago De Beers shocked the industry by announcing that it too would make diamonds for jewellery and sell them direct to the public, at a much lower price, through its new jewellery line, Lightbox.
The move has aroused much speculation about what De Beers, which once vowed it would never make lab-grown gems for the jewellery market, is really up to. Some suspect Lightbox is an attempt to kill the fledgling industry before it can get off the ground by flooding the market. And a few wonder if the play is about jewellery at all, but rather about man-made diamonds for industrial use.
Roger Lappeman, owner of Radiant Diamonds, is one who thinks so.
Lappeman is part of the fifth generation of a diamond cutting and polishing family and recalls first cutting diamonds during school holidays at the age of 12.
He wonders about De Beers’ motives. "Why come in and tell the world ‘we can make it much cheaper’, what businessman does something like that? The industrial side, to me, is the big plan at the end of the day."
Lappeman was the first person globally to buy laboratory-grown diamonds to cut and polish on a commercial basis, which was first done in his Johannesburg factory.
Man-made diamonds are produced in laboratories, of which there are about 20, using a high-pressure, high-temperature (HPHT) process. This creates the same environment that caused carbon to be compressed over centuries into diamonds beneath the earth’s surface.
Chemical vapour deposition (CVD) is another way to make a diamond. It mimics the way the gem would form in space where the environment is low pressure and under very high temperatures.
In the process, a cylinder is filled mainly with graphite, which is crystalline carbon, and just a speck of diamond, a seed, around which the precious stone will grow. The end result is a rough diamond, ready to be cut and polished. Lappeman says CVD takes a few weeks to create the diamond, while HPHT takes a matter of days.
Diamond consultant and geologist John Bristow says: "A cut and polished natural diamond and a synthetic diamond may look similar to most, but they were created in two very different environments."
Lab-grown diamonds are often called synthetic by the mined-diamond industry, including De Beers. But to Lappeman the term is inappropriate and implies that lab-grown diamonds are inferior. The only difference, he says, is the environment in which the diamond was produced.
He likens it to an orchid grown in a hothouse. "It’s no less of an orchid and these are no less of a diamond".
In July, the US Federal Trade Commission expanded its definition of a "diamond" to include those grown in a laboratory by removing the word "natural" from the definition and recommending against the word "synthetic" as a descriptor.
The label " lab-grown" or "cultured" is preferred, says Lappeman. "We don’t want to mislead anybody. This is an amazing thing that has happened — that a man can make a diamond. And we are very proud of the fact. But they are diamonds."
Looking through a jeweller’s loupe or using any other conventional method, it’s not possible to tell if a diamond is lab-grown or natural. The most valued and purest type of diamond, type IIa, is rarely mined and accounts for 1.8% of all such diamonds, but is commonly produced in a lab. There are also machines that can test the stones, though the process is hugely expensive and only worthwhile if it is a big diamond.
At the moment, lab-grown diamonds are typically smaller in size. However, that won’t be the case in future. The industry is making ever-larger stones as the technology improves.
The colour of the precious stone can also be engineered. All the lab-grown diamonds Lappeman first cut and polished in the early 2000s were yellow. "There was nitrogen in the atmosphere and they didn’t know how to take it out," he says. Now that this has been resolved, white diamonds can be created.
To make a blue diamond simply requires that a trace of the element boron is added. There is no chemical that makes a diamond pink; rather, it results from a distortion in the diamond lattice or crystal layers. This too can now be created in a lab.
Despite the similarities, the price is vastly different. And even though it’s a costly process to create a diamond, a white gem diamond made in a lab typically sells at a 30%-40% discount to mined diamonds. Pointing to a yellow diamond mounted in a small box, Lappeman says it would go for $3,000 for a "one-carater" — that’s 0.2g. Such a stone from a mine would fetch closer to $20,000. Next to it is a fancy pink diamond which would fetch $10,000 a carat, he estimates, while such a mined gem could cost closer to $300,000 a carat.
The difference between lab-grown and mined stones, Bristow says, cuts to the heart of the diamond jewellery business, which was initially all about clever marketing through De Beers’ famous "Diamonds are Forever" campaign, which tied the precious gem with romance, wealth, fashion and tradition. But times have changed. "Fact is, today ‘granny’s diamonds’ are likely to be recycled rather than handed down to daughter and then granddaughter. Brands are the in thing with the young and rich and famous" he says.
It’s hard to mine natural diamonds and easier to sell a branded product line, Bristow says. The world is also changing in terms of consumer preference. Women are buying diamonds of their choice and there are huge new growth opportunities in China’s rapidly emerging middle class.
"Having said that, I still believe there is a need to distinguish between natural and laboratory grown [diamonds] for the simple reason that it adds to the brand effect, and we know that there will always be a preference from some consumers — the wealthy middle-and upper-end buyers — for large and coloured natural stones, whereas the younger and less wealthy will be able to afford and flash their cheaper-end branded goods," he says.
The route to market has been filled with blockages but, gradually, the jewellery market has been opening up to the legitimate trade of lab-grown diamonds.
Yet the biggest opportunities are in industrial use, says Lappeman. For example, "boron in a diamond not only turns it blue, it takes the diamond from being inert to electricity to being a perfect conductor," he says. "This means computer chips and all electrical components, if you can have diamond in them, will be taken to another level. Computers will become instantaneous." Already, information can be stored in a diamond between the gap of a carbon and a nitrogen molecule. It’s also theorised that radioactive nuclear waste could be encased in diamond to create a battery that may last more than 5,000 years.
"We don’t know where it’s going to stop. It’s going to be unimaginable what you can achieve now that you can grow a diamond," says Lappeman.
Peta Gabriel, spokesperson for the De Beers Group, says Lightbox jewellery was developed to cater to customers who thought lab-grown diamonds should be for more light-hearted occasions and cost less, as they are mass produced by technology and so don’t have the same value as natural diamonds. The latter are " inherently precious because they are unique, finite and produced by nature over a billion years ago", she says.
Lightbox will position itself as "fun and colourful" fashion jewellery at an accessible price that is distinctly different from natural diamonds.
It also has a straightforward pricing approach: a quarter carat retails for $200, a half carat for $400 and one carat for $800.
Gabriel says the De Beers Group remains a natural-diamond brand. "We’re very excited about the future for natural diamonds — that’s why we’re investing around $10bn over the next five to seven years in our natural diamond business," compared with a $100m investment in Lightbox over the next four years.
Gabriel says there will be no grading reports for Lightbox laboratory-grown diamonds. "Natural diamonds are graded to provide a confirmation of how rare they are based on their natural variations of size, colour and clarity, and therefore how valuable they are. As laboratory-grown diamonds can be mass-produced in batches to a particular recipe, grading is meaningless for these products."