LAS VEGAS – Laboratory-grown diamonds are hijacking the “diamond dream,” says Martin Rapaport, who has called for an all-out battle in defense of the natural-diamond engagement ring.
Rapaport, in his annual JCK Las Vegas breakfast address on Sunday, announced that Rapaport will not provide a trading platform or a price list for synthetic diamonds, based on the results of a vote by its members.
Rapaport is chairman of the Rapaport Group, and founder of the Rapaport Diamond Report and the RapNet online diamond trading network.
Seventy-nine percent of the group’s members voted last week to oppose Rapaport listing synthetic diamonds.
“It’s not ethical,” Rapaport says, “to create markets for products that will hurt consumers and millions of people in the natural diamond trade.”
Rapaport says he expects high-end synthetic diamonds to fall in price to levels that will destroy consumer confidence in both natural and lab-grown diamonds, tarnishing the reputation of all diamonds.
“Synthetic-engagement-ring buyers will not buy any more diamonds, not even natural diamonds, after getting burned by synthetic diamonds,” Rappaport predicts. “Consumers will be shocked when value plummets and that will cheapen the value of the diamond dream.”
Rapaport urged his audience to petition the Federal Trade Commission to require that sellers of synthetic diamonds disclose that prices for lab-grown diamonds may diverge significantly from natural diamonds.
Consumers who buy lab-grown diamonds are not aware there is a difference and believe they are getting a “better deal” for the same thing. Consumers aren’t being told that natural diamonds are limited by geographical rarity, he says, and that their prices are based on scarcity related to the size and quality of the diamonds. Consumers must be informed that lab-grown diamond prices are subject to significant risk of lower prices due to the fact that they can be produced in unlimited quantities.
Beyond pricing, Rapaport contends that lab-grown diamond manufacturers are exaggerating the detrimental ethical and environmental impacts of mined diamonds and making false claims about green practices in their own industry.
He also called for a concerted marketing effort and better ethical standards from the natural diamond industry in order to counter the marketing efforts of lab-grown diamond manufacturers. “We are riding bicycles and they are flying airplanes,” he says.
As millennials approach their 40s, it’s an opportunity to sell them on the permanence, value and romance of natural diamond engagement rings. “There is no such thing as a synthetic diamond dream,” Rapaport says. The diamond engagement ring is about making a lasting commitment of lasting value, and not about getting a good deal, he says.
He also urged suppliers and retailers to become members of the Responsible Jewelers Council and work together to “get to the point where we have ethical standards.”
To defend the natural diamond engagement ring, the industry needs to ensure its ethical standing in all areas and eliminate “questionable diamonds” from the supply chain.
“Synthetics are a wake-up call, that, hey guys, you got a hole in your boat here.
“We can do better. People want to know there is no money laundering, no terrorist funding, no environmental damage.
“As millennials finally come of marriageable age, we are in danger of losing an entire generation of diamond consumers due to our failure to differentiate our natural diamonds from synthetic diamonds based on value retention and other factors.
“Better marketing focused on the benefits of natural diamonds compared to synthetic diamonds is desperately needed.”