Russian Rough Diamond Exports to U.S. Raises Questions
September 16, 07 by Edahn Golan
The average value of U.S. imports of rough diamonds declined 26.31 percent to $264.54 per carat from $358.97 p/c in July 2006. This is contrary to what would be expected to be seen in the U.S., where the cost of labor is high and manufacturing such goods is economically unviable.
Compared to last year, imports of rough diamonds leaped 75.66 percent in volume to 259,227 and 29.45 percent in value to $68.58 million.
Since February, the average value of rough diamond imports has been slashed by about 87 percent. In February, the average value stood at $2,262.16 p/c, and has been on a downward trend since then.
There is some speculation in the market about the cause behind the decline. What is clear from figures released by the U.S. customs is that imports from Russia are significantly affecting total figures and raising some questions.
U.S. imports of rough diamonds from Russia in 2007
Month | Value | Carats | Avg. Value |
January | $436,201 | 454 | $960.80 |
February | $1,366,364 | 1,671 | $817.69 |
March | $5,168,716 | 26,524 | $194.87 |
April | $1,649,080 | 3,701 | $445.58 |
May | $1,984,698 | 187,388 | $10.59 |
June | $1,425,446 | 90,791 | $15.70 |
July | $2,893,424 | 193,166 | $14.98 |
In July, Russia was the leading source of rough imports to the U.S. by volume, supplying 74.52 percent of the month’s imports.
U.S. rough import figures excluding imports from Russia give a very different picture. While total value remains high above last year (24 percent in July), by volume, imports fell 55.23 percent to 66,061 carats. Consequently, the average value of imports shot up 177 percent to $994.27 p/c, which is the trend expected in the U.S.
In June, the average value dropped 68.55 percent to $572.92 from $1,821.62 p/c in June 2006. Again, these figures are dramatically different without the Russian goods when the average value rose 26.62 percent to $2,306.55 p/c.
Why the U.S. is importing gem quality goods with such a low value at such a quantity into a market that cannot polish it economically is not clear. Such goods are usually manufactured in India. The cost of labor has shifted polishing of lower cost goods from Belgium and Israel to India and China.
Are these industrial goods imported as gem quality? Is someone setting these stones as is?
By comparison, imports from South Africa, 44.59 percent of total imports, were $30.58 million on 25,638 carats of rough diamonds, an average of $1,192.63 p/c. Botswana shipped to the U.S. $14.64 million worth of diamonds weighing 28,498 carats, an average of $513.76 p/c.