China's lab-grown diamond makers target AI, chip sectors for next wave of growth
INTC•China, which supplies about half of the world's lab-grown diamonds, is targeting high-tech uses such as chip cooling and AI servers as gemstone oversupply pressures prices. Producers say industrial diamonds have gross margins of about 50%, compared with 30% to 40% for gem-grade diamonds.
1. Seeking new demand
Chinese lab-grown diamond producers are looking beyond jewellery as competition intensifies and gemstone prices come under pressure. Feng Canjun, whose factory produces 2 million carats annually, said about 70% currently goes to jewellery; he aims to raise functional-materials production to more than half by 2030 and limit jewellery to 30%.
2. Applications in technology
Thermal management is seen as a nearer-term opportunity, while widespread use of diamonds as semiconductor material is further away and requires higher purity and tighter manufacturing standards. Chinese media have reported that Huawei and TSMC are exploring synthetic diamonds for chip cooling, while Lenovo says a consumer laptop launched in China uses diamond-copper cooling material. In April, Chinese researchers reported that diamond-copper cooling modules improved heat transfer from chip modules by 80% and chip performance by 10%.
3. Industry and supply
Henan Liliang Diamond plans to redirect 1 billion yuan ($149.18 million) raised for gem-grade production to a functional-diamond project, according to a June filing. Henan accounts for 80% of China's synthetic diamond output, and China's lab-grown production could reach 52 million carats by 2030. Producers say industrial-diamond margins are about 50%, versus 30% to 40% for gem-grade diamonds, though commercial demand remains uncertain and could contribute to overcapacity.
