In the spring of 2012, the diamond industry’s confidence in its self-regulated disclosure practices was considerably shaken. International
Gemological Institute (IGI) labs in Antwerp and Mumbai found more than 600
undisclosed synthetic diamonds passed off as natural stones, at natural diamond
prices, in batches of melee stones sent in
for certification.
The polished dealer and his supplier were under the
impression that the stones, in sizes ranging from .30 carats to .70 carats with
VVS to VS clarities in F to J colors, were all natural. The characteristics of
the synthetics at both the Mumbai and Antwerp labs were similar, suggesting
that the stones had originated from a common source.
The discovery of the stones highlights an inherent loophole
in the natural diamond industry. Large stones usually come with certifications
and are generally easier to identify as natural or synthetic. Melee stones
under .20 carats, however, are harder to examine and can be very tricky to
detect, as “they are generally dispersed in parcels of natural diamonds,” says
Thomas Hainschwang, director of GGTL Laboratories, comprised of Gemlab in
Liechtenstein and GemTechLab in Geneva, Switzerland, which focuses on melee and
gemstone grading and testing. “The smaller the stones, the more difficult it
gets.”
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The incident set off a wave of alarm. Roland Lorié, chief
executive officer (CEO) of IGI, summed up the industry’s apprehension by noting
that “a diamond dealer cannot tell the difference between natural and synthetic
diamonds and it requires sophisticated machinery at the labs to make the
necessary findings. This means that there could be a large amount of
undisclosed synthetic diamonds on the market.”
Many trade organizations and labs issued trade alerts
calling for dealers to remain vigilant regarding their sources and reiterating
the pivotal need for proper and full disclosure and identification. A warning
issued by the Diamond Trading Company (DTC) stated that “trading in
misrepresented or undisclosed products, whether inadvertently or not, could
cause irreparable damage to the industry’s reputation. Furthermore, such
irresponsible practices could undermine the integrity of the diamond supply
chain, damaging both trade and consumer confidence.”
In light of the discovery, many industry players were left
wondering if this was an isolated incident or if the synthetics market has become
a serious threat to the natural diamond market. Understanding how synthetics
are made, how they are detected, their inherent characteristics and their
prominence in the marketplace is important in assessing synthetics’ place in
the diamond and jewelry industry and the extent to which the natural and
synthetic industries can coexist.
Synthetic stones are currently made from two methods: High
Pressure-High Temperature (HPHT) and Chemical Vapor Deposition (CVD). While
“both methods can produce
gem-quality diamonds and both are costly and
challenging,” says Thomas M. Moses, senior vice president of Gemological
Institute of America’s (GIA) Laboratory and Research Department, the processes
used and the types of synthetic stones created by the two methods vary greatly
in their characteristics.
HPHT, explains Moses, was “originally introduced by General
Electric in 1954, and mimics the intense heat and pressure that — over millions
of years — crystalizes carbon into natural diamonds.” These synthetic stones
are made in a press that is able to generate these extreme conditions. The
first such apparatus, developed by General Electric, was called a “Belt Press,”
and today there are many variations of this model, which vary in size and
capability. Each press has a growth chamber where HPHT stones are grown from
carbon molecules in a metallic solvent catalyst that is usually made up of
iron, nickel or a mixture of the two.
“On average,” says Moses, “the growth time for a 1-carat
HPHT synthetic diamond is approximately one week, but because of the small size
of the growth chamber, only a few can be produced at a time.” Due to this
drawback, and the economics of production and scale, most HPHT stones are
around .50 carats in size. However, “in rare instances, rough synthetic
diamonds up to 4 carats are being grown; when faceted, they can produce cut
diamonds of about 2 carats,” notes Moses.
While the HPHT method has been around for half a century,
its profitability was established only relatively recently. “The HPHT process,
even though known since
the 1950s, has taken many years to evolve into a
commercially viable process. Until
nearly a decade ago, the price of HPHT-grown
diamonds was simply too high,”
says Hainschwang.
Diamonds are scientifically classified by type based on the
amount and location of the impurities they contain. Almost all HPHT stones are
type Ib, with up to.05 percent nitrogen dispersed throughout the diamond. This
type of diamond accounts for less than 1 percent of all natural stones. Among
natural stones, 98 percent are type Ia, stones containing up to
.30 percent of
nitrogen found in concentrated clusters. A small percentage of HPHT stones are
type Iaa, in which scattered nitrogen atoms are found in pairs.
Because the nitrogen in HPHT stones is scattered and
dispersed, almost all these stones have an identifiable color. “The majority of
HPHT goods produced so far are in the color grades from H to P — the trace of
single nitrogen atoms is responsible for this yellowish, brownish tint,”
explains Hainschwang.
On a microscopic level, HPHT stones are also inherently
shaped differently than natural ones. “The HPHT growth method typically
produces cube-octahedral-like crystals, which is a different shape than natural
diamond crystals,” says Moses.
Because they are grown in metallic solvents of iron or
nickel, the majority of HPHT stones have metal inclusions, which usually show
up as visible black spots on the stone and cause the diamond to exhibit strong magnetism.
While some natural diamonds may also exhibit magnetism, they are of much lower
levels than those created through the HPHT process.
The CVD method differs greatly from HPHT in that “synthetic
diamonds are produced by using microwaves or other sources of energy to break
down hydrocarbon gas, such as methane, inside a vacuum chamber. This causes
carbon atoms to accumulate in thin layers on a flat diamond substrate — similar
to the way snowflakes accumulate in a snowfall,” explains Moses.
The substrate used in the process, which is placed in a
reaction chamber, is always a carbon source, either an HPHT-grown synthetic or
a piece of graphite. The process, however, is a slow one as only .10
millimeters (mm), or 100 microns of diamond can be grown per hour. This growth
also has its limits in terms of depth. CVD stones over 3 mm in thickness are
extremely difficult to grow.
The CVD method, which was first successfully tried by
Houston, Texas–based chemical manufacturer Union Carbide Corporation in the
1950s, “is less costly and challenging than HPHT because it works at moderate
temperatures and low pressure, requiring smaller and less costly equipment,”
says Moses.
Like HPHT, the CVD method has only recently become
economically viable. “CVD synthesis capability has advanced noticeably over the
past five years, and we are now witnessing the emergence of a small number of
start-up companies that are attempting to commercialize production of CVD for
gem applications,” notes Simon Lawson, head of research and development at the
DTC Research Centre, based in Maidenhead, U.K., which offers identification
services for synthetic and treated diamonds and researches new techniques and
methods of detection.
Due to their unique growth processes, CVD stones are type
IIa, which contain negligible amounts of nitrogen and have high thermal
conductivity. CVD stones are also
differentiated by their shape. “The CVD method,” says Moses, “produces flat,
tabular synthetic diamond crystals, which are different than natural diamond
crystals.”
Because of the difficulty and cost of growing CVD stones
over 3 mm thick, almost all CVD stones are smaller than 1 carat. Indeed, the
largest gem-quality CVD stone ever produced was 1.05 carats, grown by
now-defunct synthetic manufacturer Apollo Diamond in 2010. Although CVD stones
do not contain metal or nitrogen, they still have a distinct color due to the
gases used in the CVD process. “Under commercially viable growth conditions,
most CVD diamond crystals are brownish instead of near-colorless,”
notes
Hainschwang.
Because of synthetic stones’ inherent color, “many
manufacturers have started to treat the synthetic diamonds post-growth in order
to transform unattractive brownish and yellowish stones into vivid colors,”
says Hainschwang. The color of CVD and HPHT stones changes through irradiation,
a type of radiation treatment, and annealing, a heat treatment that employs the
HPHT process. Indeed, through these processes, most natural stones as well as
synthetics can be altered to a desired color.
Companies like Suncrest Diamonds, based in Orem, Utah, use
HPHT processing for just this purpose. “A lot of people will grow synthetics
and want the color improved — so they’ll send them to us and we’ll run them at
extreme temperatures in our high-pressure presses,” explains Sonny Pope,
president of Suncrest Diamonds.
Due to ongoing advances in the HPHT process, stones can not
only be transformed into many colors, but also improved as white diamonds. “The
idea that we can improve whites by many grades is new — so that’s kind of
exciting,” says Pope.
While treatments do make it more difficult to differentiate
synthetics from natural stones, labs are not worried about their ability to
accurately identify treated synthetics. “Multiple treatments do add a degree of
complexity to the picture, but the characteristics of these gemstones are well
documented in research literature, and this knowledge, in combination with our
verification instruments, is sufficient to provide gemological laboratories
with detection capability for these treated synthetics,” says Lawson.
While HPHT and CVD stones differ, “the detection methods
employed are the same for both synthetic diamonds — each growth type requires
only slight adaptations in the testing procedure,” notes Hainschwang.
Synthetics can be identified as such by trained lab technicians who use the
latest technologies to test for a synthetic stone’s unique characteristics,
ranging from its chemical impurities to its crystal shapes.
“Methods involved in detection,” explains Hainschwang,
“include microscopy, low-wave and short-wave ultraviolet testing, luminescence
microscopy using various excitation bands, deep ultraviolet imaging, infrared
spectroscopy, ultraviolet-visible and near infrared spectroscopy, energy
dispersive x-ray fluorescence and last, but not least, photoluminescence
spectroscopy.”
Given the different characteristics of HPHT and CVD stones,
different detection methods work best for each. “While HPHT stones usually show
some sectored growth zoning, typical inclusions or sectored luminescence, the
CVD stones will unveil their identity after a photoluminescence spectrum has
been performed,” says Hainschwang.
Labs that test for synthetics notice that, overall, the
number of undisclosed synthetics they find is miniscule. “In most stones, we
would estimate that the percentage of undeclared synthetics in the market is so
small that it is quasi-zero,” says Hainschwang.
Given the inherent nature of synthetics and the processes by
which such stones are manufactured, many believe that detection methods will
continue to be the same in the future. As manufacturing processes become more
sophisticated, “detection can become more challenging,” says Moses. “However,
there are fundamental properties of synthetic diamonds — including growth
patterns and spectroscopic characteristics — that are detectable by trained
gemologists in a well-equipped laboratory. And we expect these distinctive
features will continue to be present in laboratory-grown material because the
growth processes used are so very different from natural diamond formation,
which takes place over long periods of geologic time.”
Labs usually use these detection methods on random samples
in submitted batches of melee stones. “It is not cost effective to send all
melee to a grading laboratory, so currently a random testing approach needs to
be taken, where a relatively small number of stones from each batch of melee is
tested,” explains Lawson. “We are working hard to enable costs in this area to
be reduced so that an affordable screening service for all melee stones can be
offered by De Beers in the near future.”
While affordable screening for all melee stones is still a
ways off, labs are making their screening services more accessible to diamond
dealers. The GIA, for example, launched its Quality Assurance Service in the
summer of 2012, which it advertises as a low-cost screening option. The
service, which costs $12 a stone, tests random batches of loose and mounted
diamonds, and is available for D to Z and fancy color diamonds of .20 carats
and smaller and black diamonds of .50 carats and smaller.
At first glance, the synthetic market might appear to be a
serious threat to the natural diamond industry. According to a report
commissioned by the Antwerp World Diamond Centre (AWDC) and prepared by New
York business consulting group Bain & Company in 2011, entitled “The Global
Diamond Industry: Lifting the Veil of Mystery,” about
5 billion carats of
synthetic diamonds were manufactured in 2010. The overwhelming majority of
these 5 billion carats, however, were used for industrial purposes. Indeed,
less than .01 percent of the gem-quality diamond market was made up of
synthetics in 2010, according to the report.
“The vast majority of our business is aimed at commercial
purposes,” notes Joe Lancia, chief executive officer (CEO) of Scio Diamond
Technology Corp., a synthetic diamond manufacturer in Greenville, South
Carolina. Like all other synthetic producers, Scio,
which “started doing
business in 2011 when it purchased assets from former synthetic manufacturer
Apollo Diamond,” thinks of synthetic diamonds primarily as tools for industrial
and technological advancements.
“Diamonds, after all, have the most versatile properties of
any raw material on earth — whether it’s for optics, heat transformation or
other tasks,” says Lancia. “Think of in the future using diamonds inside cell
phones and laptops to reduce heat. They also can be used for medical equipment
— on the surgical side, a diamond blade is the best precision tool available.”
And while Scio “doesn’t have the capacity to be making enough carats to affect
the natural diamond market, and is focused on the industrial-commercial side,”
says Lancia, “we do have a small division that makes gem-quality stones.”
Almost all of the synthetics hitting the market are at least
VS-quality stones. This is due more to the fact that manufacturers only put out
high-quality stones that will be profitable than it is due to the control
manufacturers have over their production. While there definitely is some level
of control, “it’s imitating a natural process, so you are at the mercy of some
natural forces,” explains Lancia. “We can grow up to 30 stones in one reactor,
but we cannot predict that all 30 will be the same.”
The majority of the synthetics in the market are also priced
at substantially lower price points than natural diamonds. “One of our
laboratory-grown diamonds costs at least
25 percent less than a mined stone of
the same size, cut and quality,” says Uzi Breier,
CEO of Washington D.C.–based
CVD manufacturer Washington Diamonds, LP (WDLP), which started doing business
in September 2012. Indeed, with price a key selling point, many manufacturers
try to make their synthetics inexpensive to stay competitive in the market.
“Currently,” adds Breier, “we are looking at distributors to offer our stones
through the internet, providing the least expensive way to purchase beautiful
diamonds.”
Aside from Scio Corporation and Washington Diamonds, there
are only a handful of synthetic diamond manufacturers currently operating in
the jewelry market worldwide. They
include D. Nea Diamonds, Chatham Created Gems, LifeGem and Gemesis in the U.S.,
and New Age Diamonds in Russia. These manufacturers were unavailable for
comment at press time.
While many in the diamond industry believe that improper
disclosure of synthetic diamonds is a serious problem, given the small size of
the synthetic market, they are confident in the industry’s ability to prevent
it from becoming a real threat.
“The labs involved in identifying such misrepresentation
should investigate the roots and disclose the names of the companies and owners
where such material originated,” advises Nilesh Sheth, president of loose
diamond manufacturer Nice Diamonds in New York City. “Trade members, once
aware, will surely avoid working with these companies and their associates. And
so far, there are only a couple of major producers of synthetic diamonds, so as
long as they are compliant, this issue will be a one-time event and will not be
a threat to the industry.”
As a precaution, from time to time, wholesalers send their
stones to labs to test for synthetics. But most believe they are already
insulated from any synthetic getting in their inventory through their
established relations with trusted suppliers.
“I do certify some diamonds and I rely on these laboratories
to detect the synthetic stones,” says Greg Telonis, president of Mr. Baguette,
a manufacturer of small loose diamonds and jewelry in New York City. “But I do
not use the laboratories regularly to check my inventory because I work
directly with diamond cutters from Israel and Belgium and rely on them to sell
me the proper product.”
“Overall,” adds Sheth, “we are comfortable in buying from
vendors who are in business for a long time with good ethics and integrity —
not from fly-by-night operators.”
The overwhelming opinion about synthetics is that, while
they need to be properly separated from natural diamonds, they will always
serve a particular niche in the market.
“I think everything has its place,”
says Pope. “Natural diamonds will always be natural and rare. There have always
been synthetics of every other gem and the natural gems don’t
get replaced.”
“There is room for every product in the marketplace,” agrees
Sheth. “Synthetics will also find their place in the market place, just as
crystals, cubic zirconium and moisannite.”
Article from the Rapaport Magazine - October 2012. To subscribe click here.