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The lab grown diamond market is taking over wedding season

AYESHA RASCOE, HOST:

The future is sparkling for lab-grown diamonds. Last year, the manmade diamond market was about $13 billion. And a recent report by the group Research and Markets projects that the demand will grow to almost $22 billion by the start of the next decade. What does that mean for natural diamonds? Will they no longer be the choice for brides, rappers and anyone else who likes a little bling-bling? For answers, we turn to Paul Zimnisky. He's an industry analyst. Welcome to the program.

PAUL ZIMNISKY: Yeah, thanks for having me.

RASCOE: So what's the market like now for natural diamonds, so the ones not made in a lab?

ZIMNISKY: So if we look at global diamond jewelry demand, it's approximately an $80 billion industry. More than half of global diamond jewelry demand comes from the U.S. We had very unusual volatility over the last four years. A lot of it has to do with the pandemic, the lockdown, all of that stimulus coming to consumers.

So we went from a very severe slowdown in 2020 to boom years in 2021 and 2022. And then kind of the last 18 months or so has certainly been a reversion from those all-time highs. I would say diamond prices have reflected that demand.

RASCOE: Are people turning to lab grown diamonds because they're higher quality? Do they cost less?

ZIMNISKY: The much lower price point is, by far, the greatest factor driving people to the product. Manufactured or manmade diamonds can sell for up to 90% less than an equivalent natural diamond.

RASCOE: But lab-grown diamonds - they have some of their own issues. Some people are critical of the manufacturing process. Is it pretty energy intensive to make these lab-grown diamonds?

ZIMNISKY: Yeah, that's right. It requires a significant amount of energy. The consumer that's ultimately looking for a diamond with the lowest environmental impact - a recycled or repurposed diamond would probably be the best option for them.

RASCOE: So, of course, it's June. It's wedding season. So people are going to be thinking about engagement rings. You know, they want somebody put a ring on it. But lab-grown diamonds must have a lot of other potential - right? - like in industrial uses.

ZIMNISKY: I would say, you know, that's actually a driving force for a lot of the lab diamond producers, you know, which is to eventually supply manufactured diamond for use and computer processing hardware, electric vehicle components, laser and optical equipment, energy storage devices. There are all these really excited applications for industrial diamonds. You know, but in most case, the cost of the material has to come down a lot further to make mainstream use and say consumer products economic.

RASCOE: What does the future of the diamond industry look like? Is there room for both natural and synthetic, or is it going to be like one of those things where, like, people don't wear fur - real fur anymore? They wear faux fur, or, you know, they wear vegan leather. Is it like (laughter) - is it going to be one of those things?

ZIMNISKY: Human desire for rare and valuable objects runs pretty deep within us. I don't think that's going to, all of a sudden, change. You know, it may not be completely logical or practical, but it is what it is, and I guess it's kind of a study in human psychology. But precious gems and precious metals - they make us feel good. They make us feel special. And maybe part of that is because, you know, they are impractical, and, you know, they bring some spice to our lives. But I think the lab diamond product, given that it's priced so much less than an equivalent natural diamond - I think that's, you know, going to potentially bring a, you know, whole new consumer to the diamond jewelry space.

RASCOE: That's Paul Zimnisky, a diamond industry analyst. Thank you so much for joining us.

ZIMNISKY: Thanks for having me. Anytime. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Ayesha Rascoe is a White House correspondent for NPR. She is currently covering her third presidential administration. Rascoe's White House coverage has included a number of high profile foreign trips, including President Trump's 2019 summit with North Korean leader Kim Jong Un in Hanoi, Vietnam, and President Obama's final NATO summit in Warsaw, Poland in 2016. As a part of the White House team, she's also a regular on the NPR Politics Podcast.