SYNTHETIC diamonds stand to gain 6% of the natural diamond's market, as they move from an introductory phase to a growth stage, and as production costs decrease.
This was outlined in the Namib Desert Diamonds (Namdia)'s 2018/19 annual report.
Analysts and lenders have forecast and cautioned that the rising demand for synthetic diamond jewellery could eat into the market for natural diamond when synthetics shift from an introductory phase to a growth phase.
With the forecast that as technology advances, lab-grown diamond producers will be able to create higher-quality stones, which may prove attractive to consumers.
The annual report added that "It also seems that many millennials are quite happy to buy man-made stones provided they are disclosed".
Namdia chief executive officer Kennedy Hamutenya, however, said they are not fazed by the introduction of synthetic diamonds because once they are introduced in the market, and oversaturate the market, they will also just phase out.
Hamutenya said this last week at Namdia's declaration of an N$80 million dividend to the government after he was asked what strategy they have in place to mitigate the effects synthetic diamonds may have on their production.
Namdia put its faith in a belief that consumers will get over the synthetic diamonds and come back to the natural gems.
Hamutenya said once the market gets oversaturated with laboratory grown diamonds, that market would collapse and phase out.
"Why I say I am not so worried about it is because this will fizzle out quickly and there will be overproduction and the price of that diamonds will go down. De Beers has gone into this and the reason they say this is because they want to bring down the price of these synthetics.
"What we really think is that these stones are going to become a fashion item, ladies for example can go and buy eight different stones, eight different colours for eight different outfits; basically to match their shoes and dresses. It is just an item they put on and throw away but when you buy the natural stone, it has re-sale value," he said.
He did not mince his words when he said the real and serious natural diamond buyers are the older generation, while the younger generation, the millennials, are not so fixated on natural diamonds, and are not indoctrinated with the notion that "diamonds are forever", "they generally choose to buy the cheaper rock."
Hamutenya added that: "Lab-grown diamonds started out as an experiment to see how it can be done, using different methods, such as high-temperature pressure.
It takes a lot of electricity to actually take carbon and turn it into a diamond and it is also very expensive. However, with artificial intelligence and an improvement in technology, things are becoming cheaper and people are finding cheaper ways of producing these diamonds.
In India, they are able to make a 9-carat deep pink diamond easily, moreover, the lab diamond producers can change the colour of their stones.
Hamutenya said: "These lab-grown diamonds have similarities to natural diamonds."
Mines minister Tom Alweendo, chipped in, saying there will always be consumers who would prefer purchasing lab-grown diamonds and that is fine.
"However, people should not pass on the lab-grown diamonds as though they are natural diamonds. Consumers need to know that they are lab-grown, and are cheaper and be prepared to buy them based on that," he said.
The minister said their strategy would be to market the value of natural diamonds to consumers, and what it means to people.
He said it should be something that sets the natural diamonds apart from synthetic diamonds.
"The people who are creating lab-grown diamonds stress that mining diamonds is damaging the environment, and therefore should not be supported.
"This is why we, as diamond producing countries need to make a point as to what diamonds mean to us, what do we get out of diamonds as owners of these resources. If that point is made, we would be able to deal with the effects of synthetic diamonds to the industry," he said.