Synthetics Pose a Threat to Natural Diamond Industry

Diamonds are a girl's best friend--but only if they are natural. That is the message mining companies and luxury jewelers are keen to instill in consumers as the diamond trade faces a growing challenge from the production of synthetic diamonds.

Global diamond jewelry sales are worth more than $72 billion a year, according to the World Diamond Council, and jewelers like Tiffany and diamond miners led by De Beers stress that a jewel mined at great expense, and often with great risk, is much more valuable than one made by man.

But it can be hard to tell the difference. Synthetic diamonds can be manufactured in a laboratory to the extent that they have the same properties as natural ones, raising the risk that a synthetic product could one day inadvertently end up in a luxury jeweler's showroom.

"God help the major diamond jeweler, be it Cartier, Tiffany, Van Cleef, anybody, who puts a piece of jewelry out there and it's later found to be having synthetic diamonds in it without disclosure. That fear is what's driving the industry," said Martin Rapaport, chairman of the Rapaport Group, which is the primary source of diamond price information around the world.

Synthetic diamond production is still small: annual output of gem-quality rough synthetic diamonds is less than 350,000 carats, a fraction of the 125 million carats of natural gem-quality rough, according to India's Natural Diamond Monitoring Committee. Synthetic diamonds are increasingly used for industrial purposes, and higher quality lab-produced diamonds are used in jewelry. What worries the industry is their use in jewelry without disclosure.

Tiffany says it is confident it is not at risk of inadvertently selling synthetic diamonds. "We do not and will not sell non-mined diamonds. Tiffany's insistence on only the highest standards produces diamonds that are of the utmost beauty," the company told Reuters in a statement. But the diamond industry is stepping up action and technology to protect against the mixing of synthetics and natural diamonds in the market.