Editor’s Note
The global diamond trade is facing severe disruption, with shipments through key hubs like Antwerp reportedly down to a fraction of normal levels. This article examines how trade tensions and tariffs are impacting the $82 billion industry, which relies heavily on U.S. demand.
Traders warn that the $82 billion diamond industry has “almost come to a standstill” due to tariff measures by U.S. President Trump and the global trade war. Shipments through the diamond trading hub of Antwerp, Belgium, have fallen to one-seventh of their usual levels.
According to the Financial Times, the United States is the world’s largest diamond consumer, accounting for about half of global demand. However, with no diamond mines domestically, it relies entirely on imports. Yet, Trump’s comprehensive tariff measures include a 10% baseline tariff on imported diamonds. Coupled with only temporarily suspending reciprocal tariffs on other countries, this adds uncertainty to the outlook, creating a chilling effect on jewelry traders and India’s vast diamond polishing industry.
Ari Epstein, CEO of the Antwerp World Diamond Centre (AWDC), stated that local diamond exports have “stalled” following Trump’s announcement of new global tariffs this month. Antwerp is one of the world’s busiest diamond trading centers alongside Dubai.
The diamond industry has already been facing difficult times in recent years, with the pandemic and competition from lab-grown diamonds suppressing consumer demand.
A diamond changes hands multiple times around the world before reaching the consumer—from producing countries like Botswana, to trading hubs including Dubai, and then to polishing centers in India. The only part of the supply chain located in the U.S. is the certification process. The Gemological Institute of America (GIA), the world’s largest certification body, is based in California and employs 3,200 people.
Now, due to U.S. tariff measures, the normal process of diamonds entering and leaving the U.S. for certification is under threat. Pritesh Patel, COO of GIA, stated that the institute is enhancing services at its eight international offices overseas.
Furthermore, over 90% of the world’s diamonds are processed by India’s diamond polishing industry. Since finished diamonds are considered to originate from the country where they are polished, unless the U.S. reaches an agreement with India to avoid tariffs, these diamonds will be subject to the 27% tariff rate the U.S. plans to impose on Indian products.
