The Gemological Institute of America (GIA) and HRD Antwerp recently walked back their decision to grade lab-grown diamonds using the same method they did for natural, or, in the case of HRD, not to grade them at all. While the move was touted as a way to differentiate between synthetics and mined diamonds, and to help establish the greater inherent value of natural, the general trade sentiment was “so what?”

“I don’t think it’s going to change anything;…it’s not going to affect the market at all,” said one industry member, while another commented that because their store only sold synthetics with International Gemological Institute (IGI) certificates, HRD and GIA didn’t matter.

A third pointed out that although a large portion of the trade might view GIA as the go-to lab for grading, consumers didn’t necessarily feel the same way. “Who cares, as long as IGI is still doing the majority of the grading in the US — consumers couldn’t care less about GIA,” she stated. A few also felt that even if consumers did care about GIA, an IGI report still had more impact than GIA when it came to lab-grown, seeing as the main part of its business was synthetics.

Those views echoed a whopping 47% of respondents who said the GIA and HRD moves were more of a check than a checkmate, given they would just turn to IGI. A further 18% believed their customers were unconcerned with certificates at all when buying lab-grown, and 13% said that even if they wanted only GIA certificates, the “standard” and “premium” grading tags were good enough for them and their shoppers.

A question of why
However, even those who didn’t care if the labs backtracked still questioned the reason and timing.

“Is this because the price of labs plummeted,” a reader asked. “Were they worth grading when they were very expensive?”

One jeweller believed GIA was “shooting itself in the foot” and the result would be a “migration of consumers to IGI,” a sentiment shared by a few other respondents. But that would really only affect the GIA if dealers of both natural and lab-grown switched grading for all diamonds to IGI. After all, lab-grown certification is such a small percentage of the GIA’s total revenue.

Some wondered, why now? The move would have been much more relevant when the scales first began weighing more heavily on the lab-grown side.

“A day late and a dollar short,” one reader observed. “The industry promoted synthetics, and even De Beers jumped on the bandwagon, and the lab boom began. Now the industry is upset with what they themselves unleashed…[and] the spin doctors are trying to stop the collapse of the natural market. It’s all smoke and mirrors.”

The earth’s Mona Lisa
Although a greater portion of the trade felt the move was more of a non-move, others did worry about the outcome on the industry — but not all for the same reasons. And some even while agreeing with or applauding the decision.

“I think grading is essential for any diamond — natural or synthetic — because it ensures trust and standardization for buyers,” an industry member explained. “Without it, customers may lose faith, and it might hurt the overall market, even if the intent is to protect the natural-diamond industry.”

One believed “HRD is doing it right — finally. This is a problem of their own making. They shouldn’t ‘grade’ them at all, but GIA inventing another new grading scale just for this makes it worse. Just identify them the same way they do with most gems.”

Others were sure that a new grading system would lead to confusion for the whole industry.

“GIA’s divide of ‘premium’ and ‘standard’ will have issues, because those are ranges, not exact numbers,” one said. “A D-color, IF-clarity is premium and an F-color, VVS-clarity is also premium, which is confusing.”

Another idea suggested was the possibility that “in-house” certificates for lab-grown would become more popular, a statement that provoked others to ponder whether that would just create even more confusion and dishonesty in grading.

Some 4% of those surveyed felt retreat by major labs would hurt their synthetics business, and 8% said it upset them because it showed a lack of faith in lab-grown from major industry players. Surprisingly, 10% said the pullback from the GIA and HRD had them reconsidering carrying lab-grown in their stores.

“Traditional grading of synthetics, or a ‘new system’ for grading [them] misses the point,” a respondent added. “In the art industry, they have lots of systems, techniques, and technologies for determining if, say, the Mona Lisa is real. They don’t have any system for ‘grading’ mass-produced prints of the Mona Lisa, yet high-quality prints are visually perfect. Synthetic diamonds are analogous to making mass-produced prints of Mother Nature’s original works of art. There’s nothing to grade.”

Image: A diamond with a certificate. (Shutterstock)

Courtesy : Rapaport