For most non-billionaires out there, buying a diamond can seem like an expensive endeavor. But why are diamonds so expensive, and have diamond prices always been this high? We took a long hard look at the diamond market and diamond production to determine these answers while providing hacks so you can buy bigger diamonds for less. Read on to find out!
Are Diamonds Rare?
You may have heard the reasonable assertion that diamonds are rare gemstones. But why exactly do we believe that diamonds are rare? To answer that, we have to look at the history of the modern diamond market and the diamond industry at large.
The Diamond Industry: A Brief History
The primary reason we consider diamonds to be rare is how difficult it was to source and find diamonds when what we consider “The Modern Diamond Market” began in 1866 Africa. It took 22 years for entrepreneur Cecil Rhodes to establish the De Beers Consolidated Mines Limited.
Insanely enough, by 1900, De Beers would control an estimated 90% of mined diamonds production. By the 1920s, an estimated three million carats of diamonds had been mined, and the number of carats only went up from there.
Diamonds Lag Behind
Fashion is fickle, and so is the diamond industry. Diamonds fell out of favor in the 1930s during the Great Depression. This was due partly to the Great Depression and partially because the diamond engagement rings being sold generally had a small diamond carat weight and were of poor quality.
Additionally, the influx of the supply of diamonds generally lessened the demands for them. Diamonds just weren’t considered a defining idea or factor in engagement rings.
The Resurgence of Diamonds
To combat the decline of diamonds, De Beers (yes, that De Beers) hired N. W. Ayer Ad Agency to polish up the diamond rings image.
Frances Gerety, a copywriter at N.W. Ayer came up with the slogan, “A Diamond Is Forever,” and with other creatives at the firm, firmly cemented that slogan into advertising history.
De Beers also launched PR campaigns that proposed that the size of the diamond a man proposes with is a measure of his love. The bigger the stone, the bigger the heart. And so, the cost of the average engagement ring rose with the demand for a sparkly one-carat diamond ring.
What Increases the Cost of Diamonds Today?
The history of the diamond market can undoubtedly explain why diamonds have been expensive. But what about today? According to a 2019 survey from The Knot the average engagement ring costs a whopping $5900. So why are diamonds so expensive still?
Beliefs Towards Diamond Engagement Rings
The belief that diamonds are a measure of a man’s love is still alive and well today. And most mined diamonds are steeped in heteronormative and patriarchal belief systems that feed into this idea.
Luckily, some companies provide a more accepting and inclusive point of view. At Clean Origin, you can find Non-Binary engagement rings that appeal to him, her, or them!
One of the primary reasons contemporary diamond rings are so expensive is because of the many difficulties facing mined diamonds.
Rough diamonds mined in open pits are an expensive and lengthy operation that ultimately harms the environment. On average, the largest diamond mine in the world, the Jwaneng mine in Botswana, moves 8 million tons of rock per year to find diamonds. Those rough diamonds are then sold for around $124 a carat weight. Creating a profit margin of just around 24%. One can easily see how a mine producing diamonds would want to jack up the price to make an even more significant profit margin.
Not included in this estimate is the cost of labor. Ideally, open-pit mines pay their workers a living wage which adds to the total cost of the diamond. Unfortunately, this is not always the case, as blood diamonds are known to be mined at the expense of both humans and the earth.
The Labor Behind Diamonds
Diamonds mined like above are then sent to intermediaries who will cut, polish, and shine the diamonds until they are ready to sell.
Most diamonds, at this point, can be considered rough diamonds. That means that they are still in their natural state. While still a precious stone, they do not appear as the diamond we know and love. To get to that point, the diamond is sent to diamond cutters.
Diamond cutters will use advanced machinery and computers to cut the diamond to shape and significantly shrink it from its original size. they will then polish diamonds to exhibit maximum brilliance.
Again, the more labor involved, the pricier the diamond. People have to eat after all!
The Four C’s
Diamond prices really begin to climb once they reach the second-to-last stage in the production market.
They are delivered to jewelry manufacturers who manufacture the jewelry and pay strict attention to the Four C’s of diamonds.
What are the Four C’s?
A rough diamond need not apply. The Four C’s determine the overall quality of the diamond and how high it can be appraised. Colorless diamonds with little to no inclusions will be plenty more expensive than diamonds mined with minor color and a small carat.
The Four C’s is when quality really comes into play.
Brand, Baby, Brand!
Finally, one of the most significant factors in determining the cost of a diamond is the brand that chooses to sell it.
Frequently, designer brands raise prices on diamonds, not because they are high quality, but because they simply can. The idea of a brand and having a diamond from that brand is more valuable and desirable than the diamond itself.
How to Find an Affordable Diamond
So why are diamonds so expensive? As you’ve read, for lots of unneeded reasons.
Don’t worry though there are some hacks you can use to ensure that you’re getting the best price for your diamond!
Consider Vintage or a Second Hand Diamond
One way you can find an affordable diamond is to consider buying a vintage or second-hand diamond. Sure, the diamond will be old, but it will come with its own storied history.
Because of this, this method is excellent for history buffs. However, it doesn’t allow for much customization. And if your partner is superstitious, they might not like wearing a diamond without knowing what happened to its past owner!
Lab-Grown Diamonds: The Ultimate Diamond Hack
The most effective way to find the perfect and affordable diamond is to invest in lab-grown diamonds.
Lab-grown diamonds simply mean that labs are producing diamonds in either one of two ways: HPHT methods and CVD Methods. These diamonds are stunning, brilliant, and large. They also are comparably lesser in cost to “natural” diamonds. On average, lab-grown diamonds are 30-50% less expensive due to the streamlined production of diamonds and lack of need for mines.
Lab-grown diamonds are also better for the environment. No earth needs to be dug up or natural ecosystems destroyed. It’s a win-win for both you, your wallet, and the environment!
Comparing Lab-Grown Diamonds to Mined Diamonds
Lab-grown diamonds are as real as any other diamond naturally occurring in the Earth.
Because lab-grown diamonds are real diamonds, they have the stereotypical endurance, hardness, and shine that are so admired in diamonds. Lab-created diamonds are also certified and graded, so you can be sure that the diamond you are buying is revered as ever.
There are only two differences between lab-grown diamonds and mined diamonds…the way they are harvested and their cost.
If you were to view lab-created diamonds and mined diamonds side by side, you would not be able to tell them apart. The primary difference lies in the way in which they were harvested. One takes time, effort, and labor, harms the environment, and costs more money. The other is grown in a lab. I’ll let you figure out which is which.
Additionally, as mentioned above, because lab-created diamonds do not use harmful mining practices and streamline the cutting and polishing process, they are comparably less expensive. Around 30-50%, allowing you to get bigger diamonds for your buck.
Go Forth, Hack the Diamond Production Market!
Now that you know all there is to know about why diamonds are so expensive, you can make informed decisions about the type of diamond you want. With Clear Origin, you get an incredible-looking and affordable diamond that you will be able to pass down the lines of your family for years to come. The biggest decision, it seems, is what type of cut and color of the diamond you should get….happy shopping!