Affinity Diamonds has cited the war between Russia and Ukraine as a key challenge for the year, as it drives up the cost of diamonds.
Speaking with Ragtrader, Affinity Diamonds CEO Sam Rahme said that Russia supplies a third of the world’s diamonds, with exporting banned from the country.
“So there is a shortage of diamonds,” Rahme declared. “That's the key issue we're dealing with.
“During the height of the pandemic, we did have FedEx issues and shipping issues. But at the moment, it would be that diamond prices have spiked a little because of Ukraine and Russia.
“We're paying up to 25% more for a diamond now and that's getting passed on, which is making lab-grown diamonds more attractive.”
Affinity is one a few jewellers in Australia offering lab-grown diamonds alongside naturally sourced stones.
They are created with a small seed of lab-grown diamond placed in a plasma reactor. Through controlled conditions that mirror the natural pressures under the earth, the diamond is then cultured into a stone.
“There is a 70% difference in price,” Rahme said. “$50,000 for a two-carat diamond versus $12,000 [for lab-grown] – that sways people.
“A lot of retailers won't offer lab-grown; they call them fake. Because they've invested so much money in natural diamonds, they can't afford to turn their back on them.
“Whereas we custom make. Pick the one you like and we're gonna make the ring for you – whatever rock you want.”
Rahme continued, saying that Affinity Diamonds will continue to offer both lab-grown and naturally sourced diamonds to give clients more choice.
“We'll offer both, in the same way that we let a client choose if they want a sapphire or ruby, lab-grown diamond or natural – it's another stone.
“Our natural diamonds are ethically sourced - there's a process in the diamond industry called the Kimberley Process. It's put in place by the United Nations to ensure that diamonds are ethically sourced.
“We can't tell you where in the world it came from originally – that's not part of the process – whereas with lab-grown you can.
“We just teach clients both and most often it's their budget, not just their ethical consideration.”
Expansions and collaborations
Affinity Diamonds is planning to open a new boutique in Brisbane CBD, with Rahme confirming it will open “before the end of the year”.
The new boutique will join Affinity's current portfolio, with one in Sydney CBD and another in Auckland, New Zealand. According to Rahme, placing the boutique away from the street front adds a level of intimacy for clients.
“It's the same concept,” he revealed. “I don't want to have a walk in shop, where you have to go and pick something out of the cabinet.
“I want people to have a choice and create their own piece.
“And whether they want an emerald, a diamond, a ruby, or lab-grown diamond – we come up with a design and we manufacture it on site.”
Affinity's plans for expansion is buoyed by an ongoing demand for engagement jewellery following a sentimental start to 2020. In the first six weeks of covid-lockdowns in 2020, Rahme said he saw 23 divorces sell back their rings to Affinity Diamonds.
“After that, we have never been so busy,” Rahme said. “It's just crazy. Everyone's in love and they're spending money like it's going out of fashion.
“It's good times at the moment. The only challenge is having enough staff.
“We're in the psychology business here, dealing with people's emotions – people have realized life is too short.”
In other news, Rahme announced that Affinity Diamonds have undertaken more corporate work lately. This includes making merchandise for the upcoming Guns N’ Roses global tour, which will pass through Australia in late November.
“We'll [also] be starting our designs next week for the NRL Grand Final rings,” Rahme said. “We do them every year.”