Key points
- Thailand’s gemstone and jewellery sector is once again facing growing uncertainty as the United States moves closer to introducing a new round of import tariffs that could significantly reshape the global colored gemstone and cultured pearl trade.
- Brazilian rough gemstones that are exported to another country for polishing will be subject to the tariff rate applicable to the country where the polishing—or substantial transformation—takes place before the finished stones are imported into the United States.
- The USTR is currently conducting three expedited investigations under Section 301 of the Trade Act of 1974, with the outcome expected before the end of the month.
Bangkok Gems News: Thailand’s gemstone and jewellery sector is once again facing growing uncertainty as the United States moves closer to introducing a new round of import tariffs that could significantly reshape the global colored gemstone and cultured pearl trade. With Bangkok serving as one of the world’s most important trading, cutting and distribution hubs for colored gemstones, any changes to U.S. trade policy are expected to ripple quickly through Thailand’s export industry. The latest proposals from the Office of the United States Trade Representative (USTR) have raised concerns among manufacturers, exporters and traders who depend heavily on the American market. This Bangkok Gems News report examines why the proposed measures could have far-reaching implications not only for Thailand but also for other major gemstone-producing and processing nations including India, Sri Lanka, Cambodia, Australia, Brazil and several European trading partners.
Image Credit: Bangkok Gems News
The USTR is currently conducting three expedited investigations under Section 301 of the Trade Act of 1974, with the outcome expected before the end of the month. Preliminary findings have identified approximately 60 countries, with proposed tariffs of 12.5% on imports from 46 nations linked to concerns surrounding forced labor practices. Countries named include Thailand, India, Sri Lanka, Australia and others that play important roles in the international gemstone supply chain. Another investigation is reviewing subsidies, industrial policies and manufacturing overcapacity involving 16 trading partners, including Thailand, Cambodia, Japan, India and the European Union. Industry participants are closely monitoring these reviews because any final decision could substantially increase costs for exporters shipping gemstones and pearls into the United States.
Bangkok Faces Fresh Trade Challenges
For Bangkok, which has built its global reputation as a center for gemstone cutting, treatment, trading and international distribution, additional U.S. tariffs could place further pressure on businesses already navigating changing market conditions. Thousands of Thai companies rely on exports of sapphires, rubies, spinels and other colored gemstones, many of which eventually find their way to American wholesalers, jewellery manufacturers and retailers.
Higher import duties may reduce the competitiveness of Thai gemstones in the U.S. market, potentially encouraging buyers to delay purchases or seek alternative sourcing strategies. Exporters are therefore preparing for the possibility of increased operating costs and more complex supply chain planning if the proposed tariffs are implemented.
Brazil Tariff Already Confirmed
While several investigations remain under review, one major decision has already been finalized. The USTR has announced that a 25% tariff on loose polished colored gemstones imported directly from Brazil will take effect on July 22. Rough colored gemstones from Brazil, however, will remain exempt from the additional duty.
The ruling also introduces an important clarification for international supply chains. Brazilian rough gemstones that are exported to another country for polishing will be subject to the tariff rate applicable to the country where the polishing—or substantial transformation—takes place before the finished stones are imported into the United States. This provision is expected to influence sourcing decisions and manufacturing strategies across several gemstone-processing centers, including Thailand.
Temporary Tariffs and Refund Developments
The latest Section 301 investigations are expected to replace the temporary 10% global import surcharge currently imposed under Section 122 of the Trade Act. That surcharge was introduced after the U.S. Supreme Court invalidated reciprocal tariffs previously imposed under the International Emergency Economic Powers Act (IEEPA). The temporary surcharge is scheduled to expire on July 24, although legal challenges surrounding Section 122 continue through the U.S. courts.
Meanwhile, U.S. Customs and Border Protection continues processing refunds of previously collected IEEPA tariffs. Refund claims have reportedly been submitted for nearly 60% of the approximately US$166 billion collected, although only a relatively small portion has been repaid so far. Industry experts also note that if new Section 301 tariffs are introduced, some importers may qualify for customs duty drawback programs when gemstones are subsequently re-exported or otherwise meet eligibility requirements.
AGTA Continues Industry Advocacy
The American Gem Trade Association (AGTA) has intensified its advocacy efforts in Washington, arguing that loose colored gemstones should retain their long-standing duty-free status because there is virtually no meaningful domestic production of these natural resources within the United States. AGTA President Bruce Bridges, CEO John Ford and the association’s trade consultants recently met with members of Congress to present the industry’s concerns and also secured bipartisan congressional support through a joint letter signed by nine House members.
The association has also advised members to consult qualified customs brokers and logistics specialists regarding duty drawback opportunities, documentation requirements and possible exclusions should new tariffs eventually be imposed.
The coming weeks will be watched closely across Bangkok’s gemstone district and throughout the international jewellery industry. While the final scope of the proposed tariffs remains uncertain, businesses are already evaluating contingency plans to protect supply chains and maintain competitiveness in one of their most valuable export markets. For Thailand, whose gemstone sector has earned worldwide recognition for craftsmanship, expertise and global trading influence, the outcome could shape business conditions well beyond 2026. Exporters, manufacturers and international buyers alike will be hoping that ongoing dialogue between industry representatives and policymakers results in balanced trade measures that protect economic interests without disrupting the global gemstone supply network.
Reference:
https://agta.org/agta-news-updated-on-current-and-proposed-tariffs/
For the latest developments in the Thai gems and jewelry industry, keep on logging to Bangkok Gems News.
