Hacker News Reader

I read an article in the financial newspaper today about fake diamonds arriving in Antwerp from India mixed in with real ones in 'diamond melee' packages (lots of small diamonds).

(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!

Or rather, the synthetic ones are only 'fake' insofar as they are passed off as natural (perhaps to gain a higher price). Put a different label on the box (for instance, the label 'Diamonds'), and they're 'real' again.

DeBeers managed to convince the US Federal Trade Commission to require synthetic diamond manufacturers to label their products as synthetic. But China doesn't require that. China trade practice barely distinguishes between diamonds and cubic zirconia. If you want to order diamonds from China, you have to specify HPHT (high-pressure high temperature), or CVT (carbon vapor deposition) or you'll probably get cubic zirconia.[1]

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...

> fake diamonds

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?

The value of a diamond is in its ability to display the wealth of the wearer. If a diamond no longer indicates status, it is "fake". That's the truth they're all beating around the bush of. It's pathetic, but there it is.

They're not fake by that metric either though. No one can tell the difference between a synthetic and a high quality natural diamond - certainly not with the naked eye. So you're free to pretend your diamond came out of the dirt if you so desire.

Eh, splitting hairs, but it's 'fake' only in the sense of art forgery -- one of the paintings is in fact painted by the big-name artist, while the other one, no less marvellous in its execution and visually indistinguishable, isn't. Since only the two painters know for sure, the rest of the world relies on other people's word.

I'm reminded of the Orson Welles "documentary" F is for Fake. I might have to rewatch it tonight.

And not always even that; artists have been fooled by forgeries of their own works before.

You missed my point. If a "genuine" character of a diamond is its ability to display wealth, then a synthetic diamond is "fake" by that measure, or "ersatz" or whatever you prefer. The point is that actually expressing that would make diamonds tacky and pathetic, so it's all done with implications, lobbying, and advertising.

Diamonds are a representation of money. No one can tell the difference between a legitimate $100 bill and one printed using identical equipment and processes by some organization other than the Federal Reserve. Still, a sufficiently large counterfeiting operation would diminish the value of all USD.

I expect De Beers sees it very much like this.

Diamond valuation, like that of art, is not an objective metric, and reason will only get you so far.

I -love- that the Canadian company started marketing 'conflict free diamonds' as a way to break the deBeers cartel.

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.

I don't think conflict free has so much to do with the ecological footprint as it does the human impact of diamond mining operations.

He was referring to the ecological footprint (or lack thereof) of synthetic diamonds, not conflict-free diamonds.

That's what Diamond Foundry, the SF startup, is doing. They have a good story: "We produce gem quality diamonds above the ground in America — in harmony with nature and humanity. A carefully chosen earth diamond is at the origin of each of our diamonds. In the perfectly nurturing environment inside our foundry, diamond crystals want to continue to grow."

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.

Aaaand that's the irony of it. I'd literally start a jeweler just to carry 100% American Made Conflict Free diamonds, and hang the biggest goddamned American flag out in front of my shop I can find...

... just to piss in the cornflakes of the DeBeers cartel.

This is not a war they can win.

Pearls went with "cultured" as their marketing term.

I thought cultured pearls were farmed pearls?

You're correct. Cultured (usually fresh water) pearls are farmed ones like Akoya pearls. The expensive ones are just referred to as natural (saltwater) pearls.

Yeah, that's what I was going for as one is naturally caught and the other is farmed. Not much difference given diamonds created in the lab are more pure than those mined.

'Conflict' diamonds can be viewed as another way for DeBeers and others to control the trade, by limiting the supply of diamonds into the market.

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...

Another great benefit of lab-created diamonds: you can get them with the impurities you want. Want a red or a blue diamond without the silly price tag? You've got it!

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.

For other gem materials, the synthetics are so good and cheap it's embarrassing that expensive jewelry is made from them. You can buy cheap sapphire bar stock[1] or ruby rod[2] on Alibaba. Synthetic emerald gems come in bulk in plastic bags.[3]

[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...

wow. i can actually assemble a set of real gemstones to play splendor [https://boardgamegeek.com/boardgame/148228/splendor] with.

You can, but gemstones will nick each other if you leave them loose in the box. :(

If I ever get a time machine, I know what I'm taking back to fund my travels...

You can buy the cut gemstones pretty cheap too. My wife is an artist; she has a massive catalog that contains various created "precious" gemstones for very reasonable prices.

The finished jewelry itself can stand to be more expensive, as creating that piece is an art.

Do you have a name/link for the "reputable" vendor? Just curious

I buy cut gemstones from pehnec.com; they offer synthetic rubies/sapphires (both corundum) and cubic zirconia in many colors.

Her catalog is for Rio Grande, https://www.riogrande.com/

Also, just actually checked your links and it's really not what you're describing. Link #1 and #2 are fused silica -- not jewelry gemstone material there. Link #3 isn't even emerald, it's spinel. Synthetic emerald is more expensive.

You can get actual synthetic emerald stock (and plenty else) on eBay.

Yeah, of course, just saying that specific source is obviously bad.

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.

One thing that's worth keeping in mind is that the usual term for "emerald" in Chinese is 绿宝石, which literally means "green gem". It's understandable that they might be confused about which green gems are actually "emeralds". (That particular ad still doesn't work even if you forgive use of the word emerald, though...)

Your link (3) is deeply troubling. It claims to be "synthetic emerald spinel". Emerald is beryl, not spinel. It claims to have a hardness of 9. That would make it corundum; neither beryl nor spinel is that hard. I'd really rather buy gems from a source that can describe them without contradicting itself in multiple different ways.

Perhaps alibaba is not the marketplace for you then. :P

And DeBeers is suing IIa Technologies, which is arguably the current largest (by revenue) maker of synthetic gem diamonds. I think the dinosaur's brain has finally perceived the mammals chewing on its tail.

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.

> (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."

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.

The value of a diamond in an engagement ring doesn't have anything to do with how it looks. What has always mattered is what you spent, so as long as they can create reasonably fixed pricing tiers people will spend large amounts of money on diamonds.

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.

In our culture, maybe.

https://en.m.wikipedia.org/wiki/Lobolo

I'd say burn the cash.The beauty of the diamond scam is that the resale value of diamonds is practically zero. Just as the peacock tail is costly to have and has zero practical value other than showing that its owner can bear the cost.

It is not just about spending the money; the diamond (and jewelry in general) is a signaling mechanism. It is supposed to communicate to OTHER people 'my spouse is successful and loves me this much'. A wad of cash does not do this, unless you literally carried it around on your hand.

Out of curiosity is there a place to buy a large synthesized Diamond to be used as paperweight? I though that would be cool and since I don't need it to be cut the price should be pretty reasonable.

Large cubic zirconia jewels are available.[1] This one is 45mm across. Another supplier offers up to 200mm diameter, but that may be a special order item.

[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...

It really depends on how loose your classification of "diamond" is and how large you want. Cubic zirconia is quite popular with hobbyist and some professional faceters and is quite readily available in a range of colours (try searching for cubic zirconia rough) but it's more difficult to manufacture the larger you get. Moissanite is much closer to natural diamond in both hardness and refractive index but it still seems to be fairly inexpensive uncut. Not too familiar with other diamond synthetics but the range seems to be growing.

Synthetic diamonds are not that cheap (about 50% of the price of the natural ones), because they are not that easy to make. The large synthetic diamonds are grown in HPHT medium (>2600 degrees C), and even if they are made by a machine, they still grow at an incredibly slow rate (maybe one micron/hour), so you have to keep a huge temperature and pressure for months to get a big one - and maybe at the end it shatters and you just get 3 carat diamonds from it. So the costs are not really paperweight-ready (or maybe you have a few millions to spare for a paperweight).

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...

Not fake, "artisanal". A shop in my area is buying radio ads for their line of "Artisan Created Diamonds".

https://www.youtube.com/watch?v=TBb9O-aW4zI

That firewood isn't far off the mark. There really is a market for premium firewood. I remember seeing two types on sale at a local gas station: Normal firewood bundled with a few turns of plastic wrap, and "guaranteed spider free" firewood sealed inside bags for double the price.

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.

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.

But are they GMO free?

Diamond Foundry ain't that much cheaper than the real McCoy. I thought synthetic diamonds were gonna save me a bucket of money?

I would guess that the natural diamonds' prices have fallen as the synthetics increasingly set a price floor. They have such large stockpiles of diamonds and they have to bring in revenue, they can't simply pretend the synthetics don't exist on the market and price accordingly. Or to put it another way: for such perfect substitutes and commodities, the prices should be near-identical, and so it is wrong to try to imply that consumers haven't saved a ton of money because the prices are similar; you need a time-series of prices.

> Diamond grit for cutting tools is about $100/Kg on Alibaba.

Here's a fun video about "mining" recent road works for industrial diamonds.

https://www.youtube.com/watch?v=pEONMLsSeds

We all still call it Champagne even though rarely does anyone drink sparkling wine from the Champagne region. I suspect diamonds will be the same: most people will consume the "synthetic" ones, which could by almost any physical characteristic be superior, and a small group of people will only buy "natural" on principal.

Dunno about you, but where I am (London) we certainly do not call sparkling wine not from Champagne, Champagne.

In order to be called Champagne it has to come from the Champagne region of France much like Scotch has to come from certain areas of Scotland and how Bourbon has its own set of requirements (seemingly only applying to Canada and the United States).

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.

A great suggestion, to spend money on something actually valuable.

But I'm pretty sure buying your wife/GF driving lessons as a gift is ill advised :)

Is it impossible for a new player to discover a mine and start selling them for cheaper? Why doesn't this happen if they are so overpriced? They don't all go through the same company, so I would expect someone to try to undercut their competitors.

The idea of the cartel is that nobody would want to sell their diamonds cheaper when they can sell them for more through deBeers. They don't want to get into a price war with each other since then every player will lose.

Doesn't everyone in every industry lose if they go into a price war? But they do it anyways. I'm not trying to be argumentative, I just sincerely don't understand what makes diamonds different from other products.

Small number of players, and high barriers to entry the diamond market that prevents that number from growing and disrupt the cartel.

What Hondor said, and it's extremely capital-intensive to develop a mine to production. Even after all the geoexploration to find a deposit, it's on the order of $1B - $2B to get into production. You have to move and inspect hundreds of tons of rock to find a carat of diamond in most mines [1].

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

Why don't the same cartel dynamics for natural diamonds apply to synthetics? If they can sell them for more, why won't they?

They kind of do. Prices for synthetics are typically ~ 75% of the natural equivalent. For CVD synthetics, there's significant margin in that pricing, margin that could be used to initiate price wars.

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.

https://www.youtube.com/watch?v=N5kWu1ifBGU

"You will never lose betting on human stupidity." Natural diamond gemstones are valuable, mostly, because of human stupidity. Chances are, that will continue for the simple reason that it's persisted for so long already.