Brawley and Carlitz introduced diamond products of elements of finite fields and associated composed products of polynomials in 1987. Composed products yield a method to construct irreducible polynomials of large composite degrees from irreducible polynomials of lower degrees. We show that the composed product of two irreducible polynomials of degrees $m$ and $n$ is again irreducible if and only if $m$ and $n$ are coprime and the involved diamond product satisfies a special cancellation property, the so-called conjugate cancellation. This completes the characterization of irreducible composed products, considered in several previous papers. More generally, we give precise criteria when a diamond product satisfies conjugate cancellation. For diamond products defined via bivariate polynomials, we prove simple criteria that characterize when conjugate cancellation holds. We also provide efficient algorithms to check these criteria. We achieve stronger results as well as more efficient algorithms in the case that the polynomials are bilinear. Lastly, we consider possible constructions of normal elements using composed products and the methods we developed.