DeBeers recently renewed its focus on natural diamonds after experimenting with lab grown ones, but that probably won’t be enough to revive diamond mining in northern Ontario, according to some working in the sector.
In a press release last week, the mining giant pointed to a sharp decline in prices for lab-grown diamonds, and said that trend underpinned the company’s “core belief in rare, high value and natural diamond jewellery.”
DeBeers started its lab-grown diamond business around the same time it closed its only diamond project in Ontario — the Victor Mine near Attawapiskat First Nation in the province’s far north.
Victor was a productive and profitable mine for DeBeers, which was able to recover 8.3 million carats of diamonds between 2006 and 2019.
But diamond prices have decreased overall since that time because of a changing consumer preferences and the explosion of the lab-grown diamond market.
Sudbury jeweller Gerry Aubin says nowadays only about one in 100 customers comes in asking for natural diamonds.
“This past year I’ve sold one natural stone,” he said. “Everybody’s buying lab-grown, like it’s not even a discussion that people are having.”
Aubin says lab-grown prices are so much cheaper, and people can’t differentiate them from natural ones.
Justin Daley, CEO of junior exploration company VR Resources, has noticed a similar trend.
“I’m 35 years old, a lot of my friends are getting married, not many of them are buying diamonds,” he said.
“It’s difficult to justify buying a very expensive stone when you can just buy an emerald.”
VR Resources made an important diamond discovery “by accident” in the James Bay region in 2023 while exploring for other minerals.
Daley says the deposit is promising, but he isn’t banking on it.
“There’s been very little interest in general in the project,” he said.
“Existing diamond mines aren’t making money, and when existing mines don’t make money you tend not to go looking for new ones.”
In last week’s press release, DeBeers said its plan is to invest in “reinvigorating desire for natural diamonds through category marketing,” but Daley isn’t convinced that will cut it.
“It took a lot of really smart marketing by DeBeers to create this sort of aura of mystique and allure, ‘Diamonds are forever,’ but that’s just sort of worn itself out I think,” he said.
But Mike McTavish, owner of Forage Fusion Drilling, is striking a more optimistic tone.
“I don’t think we’ll ever lose that part of the market,” he said. “Yes, we can produce a lot of stuff in labs now. But I still believe real diamonds are the best.”
He does say, however, that diamond drilling contracts have been few and far between, and they don’t pay as much as they used to.
It’s something he feels a bit nostalgic about the rise of lab-grown diamonds.
“It’s sad that we don’t rely on the good old prospector hammering on a few rocks,” he said. “That’s why we do exploration drilling, we get to go and find the unknown.”
