Owner of Zales, Kay Jewelers won’t buy Russian diamonds after Ukraine invasion

The proprietor of Zales and Kay Jewelers will now not purchase diamonds and different treasured gems originating in Russia – a shock reversal that comes as firms around the globe minimize ties in response to the invasion of Ukraine.

Signet Jewelers cited the mounting sanctions concentrating on Russia and its enterprise entities in a memo to suppliers explaining the choice. The firm’s choice to halt purchases from Russia may have main implications for the worldwide diamond commerce.

Russia is the world’s largest supply of treasured gems and the world’s largest diamond producer by quantity. Russia’s Alrosa PJSC is partially owned by The Kremlin.

“Signet has therefore halted all trade in precious metals and diamonds that originate from such sanctioned Russian sources, and you are therefore requested to stop supplying the same to Signet even though the country(s) in which you operate may not have imposed sanctions on Russian precious metals and diamonds,” Signet stated within the memo, according to Bloomberg.

The block on Russian gems will complicate issues for suppliers, since diamonds sourced from different international locations are sometimes blended collectively throughout manufacturing in hubs akin to Antwerp and Dubai, Bloomberg reported. The US accounts for roughly half of the world’s diamond gross sales.

Signet’s memo famous the directive solely applies to gems that have been bought after Feb. 24 – the day that Russian troops rolled throughout the border to invade Ukraine. That means it might be a number of months earlier than the diamond trade experiences a provide crunch.

Earlier this month, President Biden issued an government order banning imports of Russian “luxury items,” together with “nonindustrial,” or tough diamonds. In different phrases, the order doesn’t affect diamonds which can be minimize or formed in different international locations after which shipped to the US.

While discussing the block throughout an earnings name, Signet CEO Gina Drosos stated Russian-made diamonds have been a “very small impact for us” – noting the corporate needed to ensure its merchandise have been ethically sourced.

“We’ve been an industry leader in responsible and ethical sourcing now for more than a decade,” Drosos added.

In a quarterly earnings launch on Thursday, Signet famous it has “suspended business interaction with Russian-owned entities since the beginning of the invasion, in unity with all those in the world calling for peace.”

Signet added that it “does not contemplate a material impact relating to the Russian invasion of Ukraine” within the upcoming fiscal yr.