At the JCK Jewelry Show, I sat with a group of professionals in the lab-grown diamond sector, and they expressed frustration about a certain lab's laxity when it came to grading lab-grown diamonds.
“It's okay,” one of them said. “It's just lab-grown.”
I've voiced this concern before—how some people in the lab-grown diamond space occasionally downplay their product. This was a prime example.
Of course, grading matters—or at least it should. Otherwise, why have reports at all?
When lab-grown diamonds were first introduced, there was a debate about whether they should be graded using the GIA’s standard color and clarity scales, instead of the "category grade" GIA initially favored, which Lightbox also supported. Today, that debate is mostly settled. Nearly all labs provide standard “4Cs” grading for lab-grown diamonds.
But just because the scales are the same doesn’t mean the methods are.
As lab-grown diamond prices continue to plummet, I've heard complaints that some people are spending more on grading reports than on the actual diamonds. Consequently, we've seen retailers and growers develop programs to provide lower-cost alternatives instead of individually grading every diamond.
Here are a few examples:
• The International Gemological Institute (IGI), in its IPO filing, mentioned that it conducts “in-factory” grading for top diamond growers, sometimes using the factory’s own employees and equipment—quite different from the traditional independent lab grading process.
• De Beers' Lightbox brand initially launched without grading its diamonds, but now offers “verification” reports. GIA conducts “batch verification” checks for its highest-quality diamonds.
• The Grower Diamond Trade Organization (GDTO) issues reports based on a retailer’s “quality control” and argues that labs should not individually review every lab-grown stone.
David Sherwood, CEO of Daniel's Jewelers and a member of GDTO's advisory board, told me in Las Vegas: “They really shouldn’t be certified like mined diamonds. If you’re pulling something out of the ground, you need to send it to a third party. If you’re manufacturing something to certain specifications, you shouldn’t need to send it to a third-party lab...
“What’s a [grading] lab actually doing? They tell me a diamond is VS1, but it’s been designed as a VS1, and the quality control confirms it as VS1, and the retailer agrees [through its quality control] that it’s VS1. I don’t need [the lab to tell me] that.”
So, while our industry is using the same grading scales, sometimes different methods are employed to arrive at the grade.
Given the economic factors at play, this is understandable, as long as it’s done transparently. There must be openness. Consumers need to know when the grading process differs from the norm. (For example, Lightbox makes clear the methodology behind its verification reports.)
If consumers are presented with a third-party grading report—or something resembling one—they might reasonably assume that (a) each diamond is individually inspected, and (b) that inspection is done by a neutral party. That’s how grading has traditionally been done.
If a diamond is graded by the manufacturing company's staff, or if it undergoes quality control instead of individual evaluation, the consumer should be aware of that. They may not grasp all the implications of these deviations, but they shouldn’t be left in the dark.
I believe the lab-grown diamond sector should embrace the reality that it’s a new and emerging industry and move away from the outdated, overly complex 70-year-old GIA diamond grading standards. The industry could even develop its own system for assessing quality using technological tools that might be more scientific than what we use now. But as long as the lab-grown diamond industry continues to rely on traditional grading standards, many will assume it uses traditional grading methods. If not, it should at least inform the consumer.
Source: AIDI International Intelligent Diamond Association, Industry Market Committee, www.aidi.org
For questions, please contact: info@aidi.org
Cover Image: Provided by www.ebooom.com, a global leader in lab-grown diamond jewelry supply chain services.