CaratJewelers of America returns to Washington with one ask: exclusion
Trade groups met administration officials as a 10% to 12.5% tariff round covering about sixty countries took effect. Seven African producers and diamonds polished in the EU are exempt; India stays at 10%, and a second investigation is open.
§1One sentence, repeated.
Jewelers of America went back to Washington this week, and its request has narrowed to a single sentence: take diamonds, gemstones and pearls out of the tariff schedule. Industry groups met administration officials days after a fresh round of duties came into force, and the association is asking members to write to their own legislators through its action centre. The lobbying position is no longer about rates. It is about category.
The wall those groups are arguing with is now specific. The current round applies 10% to 12.5% duties to imports from roughly sixty countries under a forced-labour investigation, effective from late July. Seven producing states are exempt: Botswana, Namibia, Kenya, Madagascar, Mozambique, Tanzania and Zambia. Diamonds polished in the European Union keep their exemption. India, which cuts the majority of the world's polished goods, carries 10%, and that single line is the one that reaches most American counters.
§2A second front.
A second front is open behind it. An overproduction investigation covering India, China, Thailand, the European Union and Switzerland could add further duties on top of the current schedule, which would catch Swiss watches and Thai colour at the same time as Indian polished. The watch trade is already litigating: a group of American dealers sued over the tariff regime in late July. Two remedies are being pursued in parallel, one legal and one legislative, because neither is reliable alone.
The lobbying position is no longer about rates. It is about category.
§3Why exclusion is the cheap concession.
The exclusion argument is stronger than it sounds. Rough diamonds and coloured stones are not manufactured in the United States in commercial quantity, so a duty on them cannot protect a domestic industry that does not exist. It functions as a tax on American cutters, setters and retailers, collected at the border and paid at the counter. That is the case the trade is making, and it is the same one the exempt African producer list already concedes in practice.
An exclusion for natural stones is the cheapest possible concession for the administration and the most valuable one available to this industry, which is precisely why it is worth the trip. Retailers should not plan on getting it.
The working assumption for the autumn buy should remain 10% on Indian polished, with a contingency for the overproduction case landing on Swiss and Thai goods before Christmas. The houses that repriced early in July are, so far, the ones with a functioning margin.
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