The question of whether gold or diamonds are rarer is complex, as the answer depends entirely on the definition of rarity—geological abundance or market availability. Many people assume higher prices correlate directly with natural scarcity, but this comparison involves a chemical element versus a crystalline form of a common element, complicated by powerful market forces. To find the true answer, we must separate the natural facts from the commercial realities.
Geological Rarity: Measuring Abundance in the Earth’s Crust
Gold is a chemical element, an extremely dense metal. Formed from the collision of neutron stars, it is inherently scarce in the universe. During Earth’s formation, most of this heavy metal sank to the planet’s core, leaving only trace amounts in the accessible crust. The average concentration of gold in the Earth’s crust is estimated at only about 4 parts per billion (ppb) by weight.
Diamonds are a crystalline allotrope of carbon, the fifteenth most abundant element in the Earth’s crust. Carbon is far more prevalent, existing at an average concentration of approximately 200,000 ppb. Although the conditions required to form diamonds—extreme temperature and pressure at depths of 150 to 200 kilometers—are highly specific, the raw material is not rare. Based purely on elemental concentration, gold is vastly rarer than the carbon that makes up a diamond.
The Influence of Mining and Supply Chains on Diamond Availability
Despite carbon’s abundance, gem-quality diamonds are perceived as rare due to a tightly controlled supply chain. Historically, a few major producers, notably the De Beers company, controlled the vast majority of the world’s rough diamond supply. This centralized control allowed for the strategic stockpiling of diamonds, limiting their release onto the market and creating a manufactured scarcity to maintain high prices.
The industry employs a rigorous grading system, known as the Four Cs (carat, cut, color, and clarity), which effectively silos the supply. Only a small fraction of mined diamonds possess the clarity and color necessary to be considered gem-quality stones suitable for jewelry. The vast majority of mined diamonds, roughly 70%, are industrial-grade stones used in cutting and drilling applications. This economic barrier differentiates gem-quality stones from their industrial counterparts, creating a market scarcity distinct from natural geological rarity.
Factors Driving Gold’s Market Value and Extraction Difficulty
Gold’s market value is driven not just by geological scarcity, but also by the difficulty and cost of extraction. Since gold concentrations are low in the crust, mining requires processing enormous volumes of rock to recover a usable amount. The average all-in sustaining cost (AISC) to produce a single troy ounce of gold globally ranges between $1,200 and $1,400. This cost includes energy, labor, environmental compliance, and chemical processes needed for extraction, making the operation energy-intensive and financially demanding.
The high cost of extraction acts as a natural floor for gold’s price, ensuring stability regardless of its role in jewelry or industry. Gold maintains a constant demand because of its function as a monetary asset and store of value. Central banks and institutional investors hold gold reserves as a hedge against economic instability, reinforcing its status as a highly liquid, universally accepted form of wealth preservation. Unlike diamonds, which are largely consumed as jewelry, almost all gold ever mined is still in existence, constantly recycled due to its durability and non-corrosive nature.
Conclusion: Which Is Truly Rarer?
The determination of which material is rarer depends on the context of the question. By the scientific definition of elemental abundance in the Earth’s crust, gold is the truly rarer material, existing at a level thousands of times less than the carbon that forms diamonds. Gold is a trace element, whereas carbon is relatively common.
Gem-quality diamonds represent an extreme form of scarcity, enforced by both nature and economics. Only a small percentage of carbon atoms form the necessary crystal structure, and only a tiny fraction of those are deemed valuable enough for the jewelry market. While gold is inherently rarer as an element, high-quality, investment-grade diamonds are scarcer in the consumer market due to intentional supply management and the stringent quality demands of the jewelry industry.