Lab-Grown Diamond Rough Prices End Their Slide: First QoQ Rebound After A Year+ Of Decline

A leading international lab-grown diamond (LGD) price monitor reports that global LGD rough wholesale prices, after more than a year of continuous decline, stabilized and rebounded in Q1 2026 - the first substantial quarter-on-quarter (QoQ) uptick since the second half of 2024. The industry is now asking whether this marks a genuine cyclical turning point.

1. The price index stops falling: Q1 up ~2.7% QoQ

The report shows overall LGD rough prices rose about 2.7% QoQ in Q1 2026, with 1–3 carat rounds posting the sharpest gains:

• 1-carat VS1 D-color rough: up 5.6% QoQ to US$81 per carat;
• 2-carat VS1 D-color: up 2.4% QoQ to US$96 per carat.

However, the 1-carat category overall is still down 7.7% year-on-year (YoY) and 33% versus two years ago. QoQ declines persisted from Q2 2024 through Q4 2025. In other words, this rebound starts from an extremely low base and does not by itself confirm a trend reversal.

2. Fancy shapes outperform rounds

Fancy-shaped and square-cut LGD rough showed stronger price resilience than rounds in Q1:

• Square cuts are up 9.8% YoY;
• Fancy shapes are up 5% YoY.

The report notes that consumer acceptance of fancy cuts continues to grow at retail, with several brands positioning fancy lab-grown diamonds as differentiated products - pulling upstream rough demand. Even so, fancy-cut LGD prices have fallen roughly 95% over the past decade, so even double-digit QoQ gains only represent a small recovery from historic lows.

3. Inventory remains the biggest variable

The stabilization is not driven by a single factor but by simultaneous adjustments on both sides of the market:

• Supply side: capacity expansion in Surat (India) and Henan (China) has slowed; small and mid-sized producers have voluntarily cut output under years of falling prices, so overall supply growth is markedly lower than in 2024;
• Demand side: US jewelry retail sales rose 25% in the 12 months ending September - the strongest YoY growth since 2021 - suggesting consumer demand for lab-grown diamonds is recovering.

Yet the report also strikes a cautious note: global LGD inventory remains near historic highs, and retail price competition is still fierce. Polished 1-carat retail prices are down about 10% year-to-date, diverging from the rough-price trend. Whether rough-price gains will transmit through to retail remains uncertain.

4. The long-term logic shifts: from "capacity-driven" to "supply–demand rebalancing"

The report concludes that the LGD market is transitioning from a capacity-driven phase to supply–demand rebalancing:

• The steep price declines of the past few years were driven mainly by rapid capacity releases and a retail price war;
• The current stabilization reflects supply-side self-discipline and structural demand growth;
• If the trend holds, the next phase may be marked by more stable prices and a sustainable recovery;
• However, a sharp rebound in the short term is unlikely: YoY prices are still down significantly, and oversupply persists.

The price monitor also updated its data platform, adding historical price series, charts and visual analytics. Launched in 2018, the platform has become one of the industry's key LGD price benchmarks.

Closing

A single quarterly uptick is not enough to confirm a cyclical reversal, but it does mark the end of a one-sided decline that lasted more than a year. For upstream producers, the real test is not how high this rebound goes, but whether supply-side price discipline holds and inventory gradually clears - that is what will separate a dead-cat bounce from a genuine move toward supply–demand rebalancing in the lab-grown diamond market.

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Disclaimer: This article is adapted and rewritten from publicly available reports on the Chinese Internet, provided for industry reference only. Price figures, market analysis and institutional views cited herein belong to the original authors and the respective organizations. We make no representation as to their completeness, accuracy or timeliness, and this article does not constitute investment or business advice. For republication or citation, please contact huicetools and credit the original source.