Despite major endorsements from industry leaders in recent weeks, consumer demand for lab-created diamond jewelry crashed in the US market in June.
According to the latest research from TenorisIn the past month, lab-created diamond unit sales suffered the largest decline since becoming a consumer option in 2018.
By value, sales decreased by 25.7 per cent compared with May and 24.2 per cent on a year-by-year comparison.
In the first half of the year, the value of lab-created diamond sales has increased by 16.6 percent compared with 2022. In terms of units sold, demand improved by 48.9 percent.
“Together with the decline in consumer demand, we are seeing a continued decline in the average retail price of lab-created diamonds. The average price per carat declined 4.9 per cent compared with May, and was down a massive 22.1 per cent year-over-year,” writes Edahan Golan.
“The battle retailers are fighting against the consumer price erosion is hidden in the gross margin. As lab-created diamond prices decline, retailers maintain a considerable gross margin. In June it stood at 63.7 per cent, rising from 54.2 per cent in January. Last June, retailer gross margins on lab-created diamonds were 52.1 per cent.”
He added: “The top-selling item in June was 2.00-2.24 carat Round F/VS1. This additionally serves as a sign of how consumer demand is focused on color and clarity. In May, the top-selling lab-created diamond was a two-carat G/VS1 oval. Eight of the ten best-selling items were all two carats or larger. That highlights a significant part of the lab-created diamond allure.”
The lab-created diamond market dominated headlines In recent weeks after Lightbox Jewelry, the De Beers Group’s brand, began trialling engagement rings.
The collection features 16 items ranging between $AU895 and $AU8,950. CEO Antoine Borde said the decision to introduce engagement rings was based on consumer demand.
In a special presentation at the Jewelery and Gem ASIA Hong Kong trade show, Smit Virani, managing director of Ethereal Green Company, discussed the significance of India’s prime minister Narendra Modi presenting the US first lady Jill Biden with a 7.5-carat green lab-created diamond. Virani said he couldn’t imagine a greater ‘stamp of approval’ for the industry.
Major Australian jewelery retailer Michael Hill International also recently expanded its range of lab-created diamond jewellery, adding earrings, necklaces, and tennis bracelets.
According to CEO Daniel Bracken, lab-created diamonds are six percent of Michael Hill’s diamond sales, with plans for that figure to reach 10 percent with the new offerings.
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