☕ NDC vs. Pandora, US-India Diamond Tariffs, and Natural Diamond Prices Crash. Thursday, May 14

Good morning. The Natural Diamond Council just picked a very public fight with Pandora over carbon labels, and every eco-curious customer who walks into your store this weekend could be armed with one side of this argument. Time to get up to speed.

Pandora rolled out something it's calling the "Fifth C": per-diamond carbon footprint labels on its entire lab-grown diamond collection, claiming those stones carry 90% lower CO2 emissions than mined alternatives. The company sources its lab-grown diamonds from suppliers in the US and India running on renewable energy, and they want that number on every tag. It's a bold, consumer-facing move that forced the industry into a corner.

The Natural Diamond Council was not thrilled. Within days, the NDC published an open letter publicly calling Pandora's claims "misleading," arguing that Pandora compared its current footprint against natural diamond emissions data that in some cases dates back to 2013, and that the two products are "fundamentally different" (one finite, one manufactured at scale). The NDC's own publicly available, independently verified life-cycle assessment? Still pending. For indie jewelers, this is your new table stakes: customers are going to walk in carrying Pandora's "90%" number. If you sell natural, know your specific supplier's story. If you carry lab-grown, know your vendor's energy sourcing. "I don't know" is no longer a neutral answer.

Here's the deeper strategic question this fight is really asking: who owns the sustainability narrative in jewelry? Pandora just planted a flag with a specific, defensible number. The NDC responded with criticism but no counter-data. That's a messaging gap your customers can feel. Whichever side you land on, clarity is your competitive edge right now.

The US and India are finalizing an interim trade framework that would eliminate import duties on Indian-cut natural diamonds and colored gemstones entirely. Currently, the US charges a 25% reciprocal tariff plus the longstanding 6% MFN duty on Indian jewelry (31% total on finished pieces). Under the deal, gems and diamonds would be carved out for full tariff removal, while finished jewelry settles at a new 24% levy. Lab-grown diamonds are explicitly not included in the zero-tariff carve-out.

India cuts roughly 90% of the world's diamonds by volume. If this deal closes, your cost basis on natural stones sourced through Indian cutters could drop meaningfully. National Jeweler reported the deal is "one step closer" to being finalized as of this week. It's not done yet, so hold off on repricing your cases, but it's worth flagging to your diamond supplier now and asking what it means for their pricing pipeline.

Mountain Province Diamonds just reported Q1 2026 results that tell a stark upstream story: the company pulled more than 2 million carats out of the ground in Q1, a company record, but sold them at an average realized price of $47 per carat. That's down from $103 per carat in Q1 2025, a 54% drop year-over-year. The company posted a net loss of $65.1 million for the quarter.

To be clear, this is rough-diamond pricing at the mine level, not what you're paying for polished stones. But it signals genuine upstream weakness driven by oversupply, weak consumer demand, and tariff disruption at the Indian cutting centers where most of the world's rough gets processed. Eventually that softness works its way downstream. If your supplier hasn't offered you a better deal on natural diamonds lately, it might be worth asking.

Pandora posted Q1 2026 results that beat expectations on some metrics (organic revenue up 2%) but showed revenue actually slipping 3.3% to 7.11 billion Danish kroner. The bigger strategic news: Pandora is explicitly pulling back from the $1,000-$1,500 lab-grown diamond segment (one-carat, two-carat stones at jewelry-store price points) and pivoting hard toward what it calls "micro-fine" diamonds, priced between $250 and $300 on rings and small pendants. That lower-price segment is growing. The higher-price segment is not.

This is one of the most useful data points you'll read this week. Pandora is the best-funded, most data-rich player in accessible fine jewelry. When they walk away from a price tier, it tells you something real about where consumer appetite is living. If you've been trying to move one-carat lab-grown in the $1,000-$1,500 range and finding it slow, Pandora's internal data suggests you're not alone. The sweet spot for lab-grown may be further down the price ladder than the industry hoped.

Brilliant Earth reported Q1 2026 net sales of $99.5 million, up about 6% year-over-year and at the top of guidance. The not-so-great news: net losses widened to $8.5 million, gross margin compressed 430 basis points (from 58.6% to 54.3%), and adjusted EBITDA was negative $4.7 million. The culprits were high precious metals prices and tariff pressure. The bright spot: fine jewelry (non-engagement) bookings grew 33% year-over-year and now make up 17% of total bookings.

Even the "ethical jewelry" darling is getting squeezed on margins by $4,700 gold and tariff headwinds. But the 33% jump in fine jewelry bookings is a signal worth paying attention to: customers are buying wearable, non-diamond fine pieces at a strong clip. If you've been contemplating expanding your everyday fine jewelry selection and pulling back on bridal, Brilliant Earth's own numbers are making the case for you.

Gold was trading at $4,707 per ounce as of May 12, down from the January record of $5,405 but still nearly double long-term historical norms. The World Gold Council's Q1 2026 data tells an interesting story: jewelry demand fell 23% in volume, but the dollar value of that demand rose 31%. Customers are buying less gold by weight but spending more total. They're gravitating toward 14k options, smaller silhouettes, and lighter pieces.

This is your merchandising note for right now: lean into smaller, lighter, design-forward gold pieces. A petite 14k chain that would have retailed at $180 two years ago now commands $280 and the customer feels like they're getting something special. Chunky solid gold styles are harder to sell at current prices because the gold weight shows up too visibly in the price tag. Go delicate. Go design. Let the craftsmanship carry the price.

Between Pandora's carbon labels, an India tariff deal that could reshape your diamond costs, and gold that just refuses to come back down to earth, this week is not short on things to think about. Pour another cup, do a little math on your diamond supplier relationship, and maybe rehearse your "Fifth C" talking points. You're ready for whatever walks through the door.

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— Karat Clark, Carats & Coffee