The recent statement from AGTA on April 10, 2024 regarding the ban on bringing synthetic diamonds to the fair has elicited numerous reactions among industry experts.
This decision was made by AGTA due to a perceived need to emphasize the distinction between natural and synthetic diamonds, in order to maintain trust and clarity in the market.
In making this decision, AGTA recognized the GIA description of synthetic gems as «man-made material with essentially the same chemical composition, crystal structure, and optical and physical properties as the natural gem material».
According to JCK, The American Gem Trade Association (AGTA) anticipates minimal impact from its recent decision to prohibit the sale of synthetic gems at its trade shows.
«Out of approximately 260 exhibitors, only two of them offer any type of synthetic product» says John Ford, CEO of the Dallas-based American Gemstone Dealers Association, in an interview with JCK. «We have not received any complaints from either of those companies». JCK actually reported that the ban won’t impact this year’s AGTA pavilion at the JCK show. However, it will come into effect during the AGTA GemFair Tucson 2025.
Following his opposition to the marketing overlap between synthetic diamonds and the natural diamond market, Rapaport in its report reflected the sentiments of John Bradshaw, a member of the AGTA Board, who stated: «The definitions are essentially the same, but the crucial keyword in both is the use of the word “natural”. It is important to note that synthetic gems are not classified as minerals because minerals are natural, whereas synthetics are not».
On the other hand, Lab Grown Diamond Magazine (LGDM) doesn’t seem surprised by this move. It reports that «it was bound to happen sooner or later».
They state that, indeed, this could be the opportune moment for the lab-grown industry to unite and chart a new course forward. This involves strategizing for its advancement to the next level of growth, less reliant on natural diamonds or the traditional industry.
The situation is quite fragmented within the sector. Here are the initial reactions from industry leaders like Anup Zaveri and Roger Kylberg.
Zaveri, a member of the GJEPC’s committee of administration, said: «Banning lab-grown diamonds from AGTA exhibitions could stifle innovation and limit consumer choice. Both mined and lab-grown diamonds have their own ethical and environmental considerations, and by allowing both to be showcased, consumers can make informed decisions based on their values. Leveling the playing field for ethical products promotes transparency and encourages responsible practices across the industry».
Here’s what the CO-CEO and managing partner of 2DOT4 Diamonds LLC, Roger Kylberg, said about: «AGTA, as a leading authority in natural colored gemstones, has been vocal about distinguishing between natural and lab-grown diamonds. They advocate keeping customer’s well-informed about the origin of the diamonds they purchase. This commitment to integrity and honesty in business practices reinforces AGTA’s credibility and reliability as an authoritative source in the market.
Given the higher quality and advanced technology used in producing lab-grown diamonds, there might be a need for separate fairs or forums dedicated to them in the future. This reflects a growing trend towards fairness and transparency within the natural diamond industry on a global scale. As the market matures, it’s becoming increasingly important to draw a clear distinction between mined and lab-grown diamonds, further enhancing consumer trust and understanding».
So, we wonder: can such a separation open the doors to a new business horizon? Indeed, some believe that AGTAs decision was “illegal”, as stated by Thomas Chatham in his report on LGD Magazine.
Consequently Mr. Chatham wrote a letter to FTC opposing what he feels as an illegal ban. He co-authored the letter to the FTC with the editor-in-chief of Lab Grown Diamonds Magazine, Sandhya Valecha.
Here’s a concise overview of Tom’s communication to the FTC: «The AGTA is relying on outdated definitions of what constitutes a “mineral” and refuses to acknowledge the FTC’s previous stance that a diamond remains a diamond regardless of its origin. It’s crucial to use precise terminology to inform buyers of the origin, such as “Chatham Created Emerald” or “Laboratory Grown Diamond”. One is cultivated underground, the other above ground, with no physical distinctions.
As an industry, we compete with natural and treated natural stones, serving the same customer base at these events. If this ban is permitted, it will hinder our access to customers, unfairly benefiting natural stone dealers. This will lead to lost sales and profits and restrict buyer and consumer access to this competitive product category».
He also stated: «Similar to Rap’s anti-LGD stance, this ban will boost sales rather than hinder them. People will question why a product that has sold alongside natural stones without issues is being banned. The FTC may not respond to me directly, but this information will be recorded».
