Why Buyers Shunned the World's Largest Diamond
vanityfair.com
vanityfair.com
The diamond synthesis industry keeps getting better. De Beers can't stop them any more.[1] (They tried with Gemesys, now Pure Grown Diamonds. The CEO was a retired US Army general and wasn't intimidated.) There's even a startup in SF now. "Your diamond is hot-forged from pure atoms in our California foundry."[2] De Beers has been frantically trying to keep ahead with machines that can distinguish synthetic from natural diamonds. They claim to be succeeding, but the test equipment required is getting more and more expensive. The diamond industry dug itself into a hole by convincing buyers that the best diamond is a flawless crystal. Making flawless crystals is what the semiconductor materials industry does, and the techniques transfer to diamond making.
Small diamonds are very cheap. Diamond grit for cutting tools is about $100/Kg on Alibaba.
[1] https://www.puregrowndiamonds.com/ [2] https://www.diamondfoundry.com
(in Dutch): http://www.tijd.be/ondernemen/retail/Nepdiamanten_sijpelen_o...
I got terribly annoyed reading this article as it constantly conflates 'fake' and 'synthetic', as if they're synonyms. The 'fake' diamonds are actual diamonds, though not natural ones. Clearly a journalist who's echoing the industry propaganda.
Apparently there's an estimated 10,000 diamond making machines churning them out in China. Good!
It makes me wonder if the synthetic guys have a leg to stand on regarding the ecological footprint of pit mining versus lab grown, or if it's about the same. Maybe they could cook up their own marketing label and stop trying to hide what they're doing.
The CEO was the founder of Nanosolar, which printed solar cells and went bust because, although the process worked, it wasn't cheaper. The investors in Diamond Foundry are the usual suspects - Zynga's founder, Sun Microsystem's founder, Facebook's co-founder, a former eBay CEO, etc. They even have an actor, for coolness. An endorsement by Leonardo DiCaprio: “I’m proud to invest in Diamond Foundry Inc.– reducing the human and environmental toll of the diamond industry by sustainably cultivating diamonds without the destructive use of mining.” It's a classic startup story.
They claim to be "0.001% Rare"; this reflects their market share, like a microbrewery. Their big problem seems to be distribution. Only five small jewelers handle their product. De Beers punishes jewelers who do things they don't like by excluding them from "sights" where jewelers can buy diamonds at wholesale prices. This makes it hard for competitors to get access to retail outlets.
... just to piss in the cornflakes of the DeBeers cartel.
This is not a war they can win.
Global Witness, the organisation who pushed for the 'blood diamonds' campaign, disavowed it in 2011, because the scheme did not actually provide effective guarantees that the diamonds sold were not blood diamonds.
Others have pointed out the strange absence of any 'blood emeralds' scheme, even though they are often sourced from the same corrupt organisations and countries. But the fact that natural emeralds are much rarer than diamonds means that no-one needs to artifically limit their supply...
What a funny concept. Is the index of refraction different from diamond? Is the placement of the carbon atoms not on a diamond lattice? Or is the lattice constant somehow smaller or larger?
Nobody can detect better HPHT or CVT diamonds without lab equipment, anyway. Even under a microscope they look very similar. If you hit them with UV light and take a picture milliseconds after the light goes off, the fluorescence patterns are different. There's overpriced test equipment based on this fact. (Now there's a potential phone accessory - a UV flash that plugs into the phone for diamond grading, with associated app. Tiny market, though.)
[1] https://www.alibaba.com/product-detail/High-quality-white-hp...
I bought my wife a blue diamond engagement ring in 2010 (blue diamonds have boron in them). The price was pretty good then. I can only imagine that since they've gotten bigger, cheaper, and purer since.
Same process has been done to other gems. I've bought emerald jewelry in the past; all lab-created of course.
[1] https://www.alibaba.com/product-detail/Custom-square-sapphir... [2] https://www.alibaba.com/product-detail/Ruby-crystal-Rod_6033... [3] https://www.alibaba.com/product-detail/Synethic-Emerald-Oval...
If you're a jeweler you want to get something certified anyway. I don't think a Chinese distributor's claim of AAA-quality emeralds is worth the electrons it took to show it to me.
The finished jewelry itself can stand to be more expensive, as creating that piece is an art.
DeBeers won't prevail. The diamond market is about to change completely. The biggest challenges companies like Diamond Foundry and IIa Technologies face is building up their own sales channels. DeBeers is still fairly successful in excluding newcomers from the bourses, or diamond exchanges. But channel building is simply a matter of time and $.
Chemical vapor deposition is cheap, and there are many participants. There's Diamond Foundry, IIa Technologies, Scio Diamond Technology, Pure Grown Diamonds, and a ton of small startups in the PRC. If you want a diamond doorknob, you'll probably be able to buy one for $1K in ten years. Five years if you're good friends with somebody in Shenzhen.
This is why they've switched their marketing efforts towards the emotional. It's always been that way with the "A Diamond is Forever...", but now even more so with the emphasis on NATURAL diamonds. Lots of DeBeers and diamond cartel marketing stuff that slyly insinuates you don't value your relationship if you don't buy a REAL GENUINE diamond.
It would make a lot more sense for a suitor to give his sweetheart a wad of cash and say "I love you this much", but that's a little too transparent.
The biggest synthetic diamond data I could find is 60-carat[1] unpolished (10 carat polished).
Diamonds are also not really good as a paperweight (one carat is 0.2 grams, a sheet of A4 paper is heavier than a 25-carat diamond).
[1] http://www.diamonds.net/Magazine/Article.aspx?ArticleID=5374...
[1] www.alibaba.com/product-detail/Special-cut-for-synthetic-cubic-zirconia_60074196763.html [2] http://www.frgems.com/large-cubic-zirconia-and-synthetic-lab...
Fyi, don't trust bought firewood. Most of it isn't properly dry and can clog up stoves. Buy and stack it yourself for a season.
Or chop it yourself for the physical benefits.
Here's a fun video about "mining" recent road works for industrial diamonds.
My suggestion: buy your wife or girlfriend something more valuable than jewelry such as self-defense classes or maybe driving lessons on a track. Despite the short duration of the lessons, it'll still be worth more than a diamond ring in terms of pragmatic value.
But I'm pretty sure buying your wife/GF driving lessons as a gift is ill advised :)
Mined diamonds can't ever compete with CVD diamond synthesis costs. As more CVD producers come online, I think we'll see prices for synthetics drop drastically. There's a lot of margin available for market-grabbing.
[1] http://www.bloomberg.com/news/articles/2016-07-05/first-find...
edited for typos
For now, the synthetic vendors are riding on diamond's traditional high pricing as sustained by artificial scarcity. They're cheaper than the naturals, but not all that much. I think it's their way of maintaining high margins during early business & market development.
I expect pricing to change when there are more suppliers and sales channels. Probably a couple of years to a definite downward inflection point.
I.e. a version that focuses just on the diamond trade, and skips the "color".
In really short: The seller tried to bypass the traditional people who buy and see these diamonds, and they were not happy. Typical unethical behavior of people trying to protect a dying income stream.
Diamond thermal paste is already a thing, right?
[0]: http://www.inventgeek.com/diamond-grease/
[1]: https://www.amazon.com/IC-Diamond-24-Carat-Compound/dp/B0042...
They could even create the equivalent of a "perfect pixel" guarantee - "perfect lattice" guarantee, the diamond screen is flawless down to the atom or your money back.
That could flip the script on DeBeers in a big way.
[1] https://www.technologyreview.com/s/532636/why-apple-failed-t...
The predecessor to your phone, my Nexus 5, also contains Gorilla Glass 3, and yeah, I don't use a case, I don't use a screen protector, and there are no real scratches on the screen, and it has rode around in my pocket for over 2 years.
Now, that doesn't necessarily mean that a diamond screen would be worse than what exists today but it wouldn't be something invulnerable and resistant to any impact either.
Expect to see them on disposable razor blades within a few years (which is probably going to disrupt that market as well..).
Well...not, historically, for diamond. :-) That's changing.
Not being an expert in this field, I would guess that the barriers would lie primarily in tooling up the process to handle kilometers of material at a go, rather than making one-off surgical cornea scalpels.
Now I'm wondering just how many kilometers of razor blades are produced annually. Many, I'm sure.
Now there's another industry that only survives by the grace of marketing and people not bothering to buy a cheaper double-edge alternative.
As well as to buy more a more expensive class of product which may or may not be better--yes. But very few people have to be sold on buying a disposable razor.
That's not the point. The point is that the industry survives by keeping the consumers ignorant.
> and most of those same people see a big advantage in convenience.
I wonder how "these same people" decided that there is "a big advantage in convenience" if they have no point of comparison.
Because looking at the friends I have almost nobody people under forty has ever even tried something other than an expensive disposable blade, or perhaps a fancy electric razor. The only people I know who are the exception to it are hipsters who have since switched to growing big bushy beards. Which brings me to my other point:
> very few people have to be sold on buying a disposable razor.
Yeah, because they don't even know there are alternatives. I don't know about your supermarkets, but the ones I've been to don't even sell safety razors any more. A Mach 2 is cheapest thing for sale, and that's what I started out with. I had to buy my double edge at a barber, and I buy razor blades through the internet.
Regardless, compare the cost of one double-edge razor blade to the cost of one of those fancy N-blade thingies with aloe vera gel strips and whatnot. The price goes from the order of cents to the order of dollars (or euros, in my case).
I have a really hard time believing that the actual cost of making these things is 100 times more expensive too; in fact the shaving industry has been accused of mark-ups around 4,000 percent[0]. Either way, the convenience definitely is definitely not 100 times higher.
[0] http://www.alternet.org/story/148869/the_shaving_racket_--_h...
The convenience/cost relationship is not linear. Cost of a 500ml bottle of water: $1. Cost of refilling that bottle from the tap: $0.0005. Convenience factor difference: almost definitely not 2000x. Yet people still buy bottled water. Is that a paradox? I don't think so, because people put various values on things like time and mental space occupied which may very well dwarf the absolute cost involved.
No, that's also marketing[0], and by the way, the bottled water industry is incredibly destructive for the environment[1]. Also, I don't see how my argument involved any paradoxes.
You know what "convenience" really means in this context? Taking whatever is available at the very limited selection at the supermarket[2], without putting any more thought or effort into it. But when you think about that, that's creating a demand by simply not offering or mentioning the cheaper, less profitable options (because obviously, supermarkets make more money selling the expensive stuff too).
[0] https://www.youtube.com/watch?v=wHsy1OZVUzc
[1] https://thewaterproject.org/bottled-water/bottled_water_wast...
Problem 1: induction cooker. so use gas.
Problem 2: the pots may ignire if overheated...
I'd definitely give it a try.
Vacuum-lift airships (at least on Earth) will remain a dream.
Natural diamonds are not perfect, and manufacturing a large perfect diamond is probably very difficult, but I don't think it can be ruled out as impossible.
However, I do think there will always be a market for large diamonds extracted from cold hard Earth. Yes, synthetics will likely eventually surpass these stones. Owning one of the largest natural stones ever found will probably always seem sexier in many (read: likely non-high-tech) circles of ridiculous wealth.
Production has risen steeply over history (http://www.gia.edu/cs/Satellite?blobcol=gfile&blobheader=app...) but "The total global production from antiquity to 2005 is estimated to be 4.5 billion carats". So for an all-time estimate, 11*360 + 4500000 / 360 = 16460.
This seems improbably high: surely at least some of those 16k giant stones would've survived? So maybe Lucera's current mine got lucky, or it's unique in providing lots of giant stones. ("It has an enviable share of the world’s heavyweight diamonds. Of the 52 biggest diamonds discovered in the past three centuries, 10 have come from Lucara in the past three years. With modifications under way at the mill, Lucara will soon be able to recover diamonds up to 3,000 carats, and next year, up to 5,000 carats—as big as a softball.") Still, I would personally stay the hell away from giant diamonds as any kind of investment or prestige trophy.
I wouldn't extend the ratio of large diamonds found at Karowe (or Letseng) across the whole industry. They are fairly unique mines.