Diamond bourses warn of 'irreparable harm' of Russian stone ban

The World Federation of Diamond Bourses has hit out against plans to sanction Russian diamonds, saying it will increase costs for non-Russian miners.

In an open letter, the industry body warned of "irreparable harm" to the industry if the G7 pushes ahead with plans to impose arduous traceability standards on diamond producers in an effort to keep out Russian stones.

The G7 nations, comprising Canada, France, Germany, Italy, Japan, the UK and the US, as well as the EU, have banned the import of Russian diamonds in response to the full-scale invasion of Ukraine.

The state-owned Russian miner, Alrosa, is the world's biggest diamond seller.

The G7 is now planning a series of measures to enforce this ban, which will be rolled out from March 1.

"Considering the complexity of the pipeline and the looming date of the slated prohibition, the industry is seriously concerned as no guidance has been issued on the evidence required to comply," the WFDB said.

"With just two weeks to go, the silence is extremely concerning. The trade requires clarity of process to secure their business."

The WFDB raised the concern that new rules could force diamonds for G7 markets to be sold solely through Antwerp, cutting out other bourses and increasing costs for miners.

"We stand united against forcing all participants who wish to sell their polished diamonds in the G7 markets to send their rough to Belgium first," the WFBD said.

"As diamond experts, we know that this would add no value to the objectives of the G7 member states and would result in a major restriction for all non-Russian diamonds, with terrible impacts on the industry."

"It would also force a functioning trans-global trade into one centralised point that would create bottlenecks in supply and give unwarranted power and advantage to one participant at the detriment of all others."

The WFDB urged the G7 to support a global solution to track diamonds, accessible to artisanal and small-scale miners.

"The diamond trade is an important livelihood for millions in the artisanal trade, and although informal, artisanal mining is legal and legitimate," the WFDB said.

"Despite our best efforts, the G7 seems determined to implement a system that will harm the flow of rough diamonds from African countries and other non-Russian sources," WFDB president Yoram Dvash said.

"The proposed G7 solution will bring significantly increased costs to manufacturers and traders and will make non-Russian natural diamonds more expensive and less competitive at a time when the industry is facing a multitude of challenges."

"Any restriction that isn't accessible to this important sector of the industry will create room for exploitation and disproportionally impact the sector."