The shrinkflation problem in diamonds has two factors. Firstly, I and many others in the industry believe that clarity grading have been significantly loosened over the past 20 years. This leads to diamonds being graded one grade up than what they should be. For example, a diamond being graded a VS2 instead of an SI1. There used to be a saying in the industry that an SI2 or above was definitely \u201ceye-clean\u201d, meaning you couldn\u2019t see any inclusions from the top with your naked eye. About 15 or so years ago, these standards changed when all labs started grading stones that weren\u2019t eye-clean as SI1 or SI2, so only VS2s and above were guaranteed to be eye-clean. Nowadays, even some VS2s are not eye-clean.<\/p>\n
However, the second and far more serious factor is that of cut grading. Whilst all grading labs have different cut grading scales, the GIA<\/a> has loosened their top cut grade, which is \u201cexcellent\u201d, so significantly that it is now virtually meaningless.<\/p>\n Back in 2005, GIA introduced their cut grading system<\/a> and whilst it wasn\u2019t perfect, it was a good step forward for the GIA, which had pretty much been ignoring cut quality up until that point. It is important to note that around this time, there was already a lot of research being done by the likes of Garry Holloway<\/a> and The American Gem Society<\/a> into diamond cut, so right from the outset, the GIA cut grading system seemed somewhat inferior. In addition to this, companies like Gemex<\/a> produced machines that directly measured a diamond\u2019s light performance.<\/p>\n Fast forward to 2022, and GIA dominates diamond grading and is seen as the gold standard around the world. In fact, doing a quick search on the diamond market, GIA account for upwards of 95% of the high quality diamonds above 1ct being sold on the wholesale market. However, that dominance is surely not due to the GIA\u2019s cut grade.<\/p>\n Back when the GIA\u2019s cut grading system was first released, there was a fair bit of criticism from some areas of the diamond industry due to deeper diamonds being graded as \u201cexcellent\u201d, especially from Garry Holloway and his friends at Pricescope<\/a>. <\/strong>Some of this criticism was fair, and some of it was a little bit over-dramatic, or even used to shill diamonds from Pricescope vendors. However, we have come to a point that GIA\u2019s brazen loosening of their cut grading standards has become almost ridiculous. Whilst I don\u2019t have exact numbers, when the GIA first released their cut grade, the deepest diamond that could earn the top grade of \u201cexcellent\u201d would have a depth percentage of around 62.7%. Now, with just a quick search, I found that GIA now grade diamonds with a 64.2% depth as \u201cexcellent\u201d, which is their top cut grade!<\/p>\n Of course, diamond manufacturers are responding accordingly and cutting diamonds according to the updated GIA cut grading system. This no doubt increases yields significantly, leading to more profit for the manufacturer, and, in a world where high quality diamonds are essentially commoditised, manufacturers can get away with it without many noticing.<\/p>\n The loosening of GIA\u2019s cut grade standards essentially means that diamond consumers are being hit in two ways:<\/p>\n However, as a consumer, there are two simple ways of beating “diamond shrinkflation”:<\/p>\n![\"Diamond](\"https:\/\/www.jogiadiamonds.com.au\/images\/shrinkflation1.jpg\")
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![\"Diamond](\"https:\/\/www.jogiadiamonds.com.au\/images\/shrinkflation2.jpg\")
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