Synopsis
- The exports of Lab-grown Diamonds (LGDs) are declining and have seen around 16.5% decline y-o-y for FY24. While the sales volume of LGDs has been growing, the declining prices have impacted the exports. However, the depreciating rupee is likely to act as a cushion for the industry. Overall, the LGD exports are expected to witness a revival in exports with expected growth of 7-9% to reach ~US$1500-1530 million in FY25.
- Going forward the demand for LGDs is expected to revive in FY25, as demand for naturally mined diamonds may remain sluggish. This is attributed to its price point, environmental sustainability, and intensified competition from India against other leading LGD-producing nations.
- Affordability, environmental sustainability, and similarity are the primary factors that are expected to revive the demand for LGDs, particularly in the 1-3 carat segment of natural diamonds. With nearly identical chemical, optical, and physical properties and a crystal structure as that of natural diamonds but at a fraction of their cost, LGDs have experienced considerable growth in the last few years.
- With the escalation of gold and natural diamond prices, consumers are looking for affordable alternatives in precious jewelry. The lab-grown diamond-studded jewelry aptly caters to this demand.
