CaratTwelve and a half for color: Washington prices the rainbow
USTR's expedited Section 301 investigation proposes 12.5% tariffs on colored gemstones and cultured pearls from roughly 46 countries, with resolution expected by end of July. Brazil's 25% is already in force, and the temporary 10% global surcharge expires July 24.
The colored-stone trade now has a number to dread and a date to watch.
Color spent two decades as the affordable, story-rich alternative to the diamond counter, and its supply chain, artisanal, multi-country, thinly capitalized, is the least equipped in the industry to absorb a demand shock at the border. Twelve and a half points will not close Thailand's cutting houses, but it will quietly reprice every American jeweler's fall reorder.
Watch July 24: if the 10% surcharge dies quietly and 12.5% arrives loudly, the net change is small and the headlines will be wrong in both directions.
| Figure | |
|---|---|
| Brazil — Concluded, 25 Points On Polished | 25 |
| Expedited — ~46 Countries, Due End-July | 12.5 |
| Subsidies Review — 16 Partners, Late July | TBD |
| Global Surcharge — Dies July 24 | 10 |
IA number and a date
The US Trade Representative's expedited Section 301 investigation into colored gemstones and cultured pearls has produced preliminary findings proposing a 12.5% tariff on imports from roughly 46 countries, a list that includes every sourcing capital that matters: India, Thailand, Sri Lanka and Australia among them.
Final resolution is expected by the end of July, which gives the trade roughly a week of certainty about its uncertainty.
It is one of three tracks running at once. A second review covering subsidies and industrial policies spans 16 trading partners, including Thailand, Cambodia, India, Japan and the European Union, and is due to resolve later in July.
The third, aimed at Brazil, has already concluded: a definitive 25% tariff on loose polished colored gemstones from the country that supplies much of the world's tourmaline, aquamarine and emerald, which this page covered as it took effect this week.
Rough Brazilian stones stay exempt, in the same rough-in, polished-pays logic that now governs the Canadian diamond order.
IIOne deadline runs the other way
One deadline cuts the other way. The temporary 10% global import surcharge, the blanket duty that has sat over nearly everything since spring, expires July 24.
If it lapses as scheduled while the 12.5% proposal is still pending, the color trade will briefly enjoy something close to its historic footing, a window importers with goods in transit will not need to be told twice about.
IIINothing domestic to protect
The American Gem Trade Association's argument against the whole exercise is that a protective tariff needs something to protect. The United States has effectively no commercial colored-stone mining or cutting industry; AGTA argues loose colored gemstones should keep their historic duty-free status because there is "no meaningful domestic production".
A Section 301 remedy with no domestic industry behind it functions as a straightforward consumption tax on sapphire engagement rings and pearl strands, paid at American counters.
01Method · the desk’s arithmetic+
Bar for the subsidies review indicates an open question, not a rate
Fifty percent for Canada: the wall reaches the diamond counter
The northern section of the same wall: 50 points, six codes
The trade, filed before the New York open.
Prices, tenders and the one story that moved the industry overnight. Ninety seconds.
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