Are Russian Mined Diamonds Flooding Australia?
Australia has not followed the G7 and EU in banning Russian diamonds, and therefore they continue to be sold across Australia in plain sight. They are sold in jewellery stores marketed without Russian branding, hidden as Kimberly Process Certified, and often marketed as conflict-free.
We believe it unethical and misleading to claim that unknown-origin diamonds, certified under the Kimberley Process, are "conflict-free" when they include diamonds mined in Russia. In 2023 alone, around US$300 million in revenue from the Alrosa diamond company was directly passed to the Russian Federation and, therefore, Russia's invasion of Ukraine. The Kimberley Process was designed over twenty years ago to stop rebels and their allies from selling diamonds to fund war. It's an outdated process whose scope does not include governing states and countries like Russia and its unjustified war against Ukraine.
The G7 and EU sanctions aim to cut off this key revenue stream for Russia's war efforts by phasing out imports of Russian rough and polished diamonds over 2024. However, this creates challenges as diamonds are a globally traded commodity, often passing through many hands before reaching consumers.
While the sanctions close loopholes for Russian diamonds entering G7/EU markets, they inadvertently increase the percentage entering non-sanctioned markets like Australia. As supply is choked off from major markets, sellers divert more Russian goods elsewhere. Australian consumers must be vigilant about demanding transparent sourcing of their diamonds, and you must ask their jewellers, “What is the origin of your diamonds?”.
Sanctions Overview
The G7 (Canada, France, Germany, Italy, Japan, UK, US) first announced plans in May 2022 to ban Russian diamonds, with the EU following suit. Implementation began on January 1, 2024, with a ban on newly mined Russian rough diamonds. It was expanded on March 1 to polished diamonds over 1 carat and will further expand on September 1 to all remaining diamonds, lab-grown stones, and diamond jewellery.
To enforce the bans, the G7/EU is developing a system requiring all non-Russian rough diamonds to be imported through Antwerp for verification before entering their markets. However, concerns have been raised about supply bottlenecks and whether Antwerp should be the sole chokepoint. Botswana, for example, has its own diamond polishing industry. We support its desire to verify its own diamonds in its country to lessen the disruption to its industry and exports.
Australian Diamond consumers
As a non-sanctioning nation, Australia will continue to receive an influx of Russian diamonds diverted from major markets. However, none of these diamonds are labelled Russian, and consumers are left in the dark. Be aware of any diamonds marketed as "conflict-free" or Kimberly Process Certified unless the seller can guarantee their origin is not Russian.
The Kimberley Process, while well-intentioned, does not bar Russian diamonds, which can still be traded globally with Kimberley certification despite their link to Ukraine.
The Path Forward for Australian diamond buyers
To avoid inadvertently funding the Ukraine invasion, Australian diamond buyers should seek out jewellers with strong ethical and responsible sourcing standards. While all of our diamonds at Utopian Creations are Kimberley Process Certified, we go further with guaranteed origin.
Ultimately, sanctions aim to change behaviour by cutting off revenue streams, but they also aid consumers by creating a more ethical buying market. Diamonds are often seen as an enduring gift of love, and consumers should be given the information they require to make an informed decision about their important purchase. Currently, the Australian government and industry leaders are quiet on the issue, as are the hundreds of large jewellery businesses and thousands of locally owned jewellery businesses trading in Australia. Unfortunately, this leaves it up to you as the buyer to ask your prospective jeweller if they know the origin of their diamonds. Take hope that businesses like ours, Utopian Creations, sell known origin diamonds, coloured gems and, importantly, Australian gold. We are always available to help, even if it's just for that important second quote or to answer a question about any responsible sourcing sustainable jewellery issue.
Ben Manning
Director
Utopian Creations
