President Joe Biden issued an executive order on Friday, March 11, banning the import of “non-industrial diamonds”, along with vodka, caviar and other luxury items.
“As Putin continues his relentless assault, the United States and our allies and partners continue to broadcast on the same wavelength to increase economic pressure on Putin. With the aim of further isolating Russia on the world stage,” he told reporters.
As a result, restrictions on banking transactions with Russia were introduced two weeks ago. Something which had already made the diamond market difficult, but not illegal.
This latest move is a response to Russia's escalating attacks on Ukraine. That is why it is banning transactions with Alrosa, which is one-third owned by the Russian government.
However, the US government has not yet clarified whether the ban affects diamonds mined from Russia but cut and polished elsewhere.
“We are talking about a very big case and a once-in-a-lifetime situation for the diamond industry.” So said Tiffany Stevens, CEO and general counsel of the Jewellers Vigilance Committee (JVC).
In particular, JVC advises its 600 members to immediately cease all direct purchases of diamonds from a Russian company.
“The question that arises is what do we consider to be of Russian origin?”, Stevens then told CNN.
“It can come from Russia and then be cut and polished in India. At that point do we consider it an Indian diamond?”
JVC noted early Monday what the ban on diamond imports from Russia entails. These are rough or simply sawed, cut or crushed diamonds. That is rough diamonds, as well as those that are cut and polished in Russia.
Rough diamonds from Russia that go through a processing process in another country (cutting and polishing) are given the identity of that country. Therefore their importation is then legal as non-Russian products.
JVC said it recommends that trade continue with «extreme caution» regarding diamond imports, as the risk of additional limits in the future is high.
It is worth mentioning here that, during 2021, Alrosa mined 32.4 million carats. Which makes it the world's largest producer by volume, with sales of rough diamonds of just over $4 billion. Taken together, it accounts for almost 30 percent of global supply.
