Rising Demand for Lab-Grown Diamonds Collides With Falling Value

By JCK News Desk | April 21, 2026

Lab-grown diamonds continue to reshape the U.S. jewelry market, but two recent reports point to increasing strains on the sector. Retail data and longer-term market evaluation by analyst Edahn Golan and the Tenoris consulting firm suggest that while lab-grown consumers are buying bigger and trading up, the category faces mounting inventory pressure, accelerating price erosion, and strategic challenges.

In its monthly sales report for March, Tenoris highlights what it describes as “a growing structural imbalance” in the lab-grown market. Inventory of lab-grown diamonds has been rising markedly faster than sales: The ratio of lab-grown inventory to sales has increased from “the high single digits” in 2020 to nearly 50% at present. Sell-through has slowed, and lab-grown stones are remaining in inventory longer than in previous years.

For retailers, this creates a quiet but serious risk: more capital tied up in a category facing persistent price pressure. For growers and manufacturers, Tenoris warns of a potential “bullwhip effect,” in which any softening in consumer demand leads retailers to cut orders, leaving excess goods and capacity stranded midstream.

Those inventory dynamics echo a broader tension that Golan, co–managing partner of Tenoris, has been tracking for years. In his first-quarter report, Golan describes a market in which consumer demand continues to grow while prices move steadily downward.

Wholesale prices for lab-grown diamonds declined 14% in the first quarter of 2026, continuing a downward trend that has “no clear floor yet,” Golan says. The sharpest drops occurred for larger stones—once major profit drivers—with 3 ct. round diamonds, for example, down 28%, versus 1 ct. rounds’ 15% decline.

For jewelers, the message is increasingly clear: Lab-grown diamonds will remain a key product, consumer demand should persist, but product assortment and pricing strategy matter more than ever. Inventory discipline is becoming critical as price erosion continues and turnover slows.

For the overall jewelry industry, Tenoris noted that sales rose 5% year-over-year in March, though growth came almost entirely from higher average selling prices rather than increased unit volume. Unit sales fell roughly 10%, as the trend—seen since last September—continued of declining sales at price points under $1,000 while higher-ticket sales improved.

The JCK News Desk uses AI to help research and produce articles. This story was then reviewed and edited by staff writer David Blomquist.