Are Diamonds Still Worth It? What Engagement Ring Shoppers Need To Know

‘Would you value a ‘cheap’ solitaire less?’

They say diamonds are a girl’s best friend, and largely they have been, holding their value over time with a sureness that many other investments can’t offer.

Traditionally diamonds have been a finite resource, carefully controlled in supply and demand to retain their high price points. However, new reports are surfacing that diamond prices could be heading for a free fall.

We prize diamonds as a choice for engagement rings for their beauty, but also their value as an investment over time. If the value is dropping, we can’t help but wonder, will we keep seeing diamonds as the go-to engagement stone in future, or is it all due for a shakeup?

What Is Going On With Diamond Prices?

A report in the Business Of Fashion examines the meteoric rise in purchases of lab-grown diamonds. For example, diamond exports from India (where most of the global supply of diamonds are cut and polished) saw an increase in lab-grown exports by nine per cent this year, from one per cent the previous year.

Consumers are opting for lab-grown stones for a number of reasons: the ethics of where the stone has been sourced for one, but also their slightly cheaper price point for what is chemically and structurally exactly the same substance.

At the same time, industry experts told the publication that demand for diamonds has also weakened in line with the financial crises taking place across the world, with a high cost of living and low wage growth. Luxury consumer spending is down, thus so is demand for mined diamonds.

The report isn’t suggesting that diamond prices are about to slash in half, but that there are a number of elements taking cuts away from the major diamond suppliers, disrupting the careful supply and demand chain that stabilises diamond prices.

Luxury diamond company De Beers told Business of Fashion that there has been a downswing in diamond shopping after Covid sent diamond prices too high. It’s not just pricing though, they admit that the rise of lab-grown diamonds is momentarily changing the category.

“There has been a little bit of cannibalisation. That has happened; I don’t think we should deny that,” said Paul Rowley, head of De Beers’ diamond trading. “We see the real issue as a macroeconomic issue.”

Why Is The Diamond Market Changing Now?

We love a big rock like Hailey Bieber’s. (Credit: Image: Getty)

While lab-grown diamonds have traditionally been a go-to in affordable jewellery, it took a while for them to be taken seriously in the bridal market, where there is a lot of sentimentality about purchasing a ‘real diamond’.

However, this is slowly changing, with positive perception of lab-grown diamonds increasing (and the more affordable price sweetening the deal).

Makayla Donovan, the founder of The Moissanite Company explains, “A 1 carat moissanite retails for around $2,000, while a 1 carat lab grown diamond retails for around $4,500, and a 1 carat mined diamond for approximately $12,000.”

On top of that is the issue of ethics. “Lab grown diamonds usually offer a guaranteed source of origin, so there is transparency around where you diamond came from, and no risk of a murky history.”

She adds, “It’s no secret that the cost of living is a key factor in this shift, couples are having to really prioritise their finances and when it comes to lab grown diamonds. They are not only the more responsible option but the more attainable option. Couples can achieve their dream ring with the same quality, if not better – for half the cost.”

Business of Fashion reports that De Beers has been forced to cut prices by more than 40 per cent in the last year to manage the supply-and-demand ratio.

Will Synthetic Diamonds Also Suffer?

Are coloured stones the next big trend? (Credit: Image: Instagram)

While the mined diamond industry is being shaken up at the moment, so too is the lab-grown diamond market, which is extremely competitive to offer increasingly lower prices.

Lab grown diamonds are also not a finite resource in the same way mined diamonds are, making it harder to create that supply-and-demand that drives prices higher.

What About The Future Of Engagement Rings?

In a cost-of-living crisis without wage growth, saving for a diamond ring is becoming increasingly tricky.

The use of colourless stones in engagement rings is partially the work of marketing. De Beers, which was established in 1888 is famed for the iconic marketing slogan, “A Diamond Is Forever”.

However, we’ve seen the popularity of coloured stones rising. Kate Middleton’s ring (once Princess Diana’s) features a huge sapphire, Megan Fox’s huge toi-et-moi ring is half diamond half emerald.

Donovan admits she’s seen a lot more interest in coloured stones in her business, including coloured moissanite.

“There has been a mindset shift around the value of an engagement ring being more of the sentiment it holds, rather than the ‘value’ of the stone. A direct result of this, is couples choosing coloured gemstones such as coloured moissanite for not only its affordability but its aesthetic,” she explains.

“We’ve seen a huge demand in particular for our signature Champagne Moissanite which is available in seven shades, ranging from a light champagne hue to a deep cognac shade.”

Changes in the engagement ring ‘mood’ makes us wonder whether the fashion of a colourless mined diamond stone being the ultimate symbol of love for a proposal is becoming a thing of the past…

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