DiamondBuzz
US Tariffs: “Existential Threat” to Israel’s Diamond Industry
Israel’s diamond industry is facing an “existential threat” after the US zero-rated polished diamond imports from the EU, but retained the 15 per cent tariff on Israeli goods. Israel’s once-thriving diamond industry is already reeling from the global downturn and the impact of two years of war against Hamas in Gaza.
Net exports of rough and polished diamonds fell 23 per cent year-on-year during January to August 2025 (from $2.1bn to $1.6bn) according to Israeli government figures.
Nissim Zuaretz president of the Israel Diamond Exchange called on Israel’s government to challenge the US tariffs, which give Antwerp and other European suppliers a huge advantage over his country.
In a clear sign of the growing strategic importance of lab-grown diamonds for technological applications, the Spanish government has committed a massive EUR 750 million (approximately $813 million) investment to Diamond Foundry’s new manufacturing plant in Trujillo.
This significant funding injection is specifically earmarked for the production of semiconductor-grade, lab-grown diamonds. It dramatically boosts the project’s war chest, adding to the initial EUR 80 million in funding that the European Union had already pledged last December.
The Trujillo facility is poised to become the largest of its kind in Europe, specializing in high-tech, industrial, and semiconductor-grade diamonds.
- Projected Output: When operations begin—anticipated sometime between 2027 and 2029—the plant is expected to yield over 4 million carats annually, with production slated for substantial increases thereafter.
- Total Project Value: The full cost of the Trujillo project is reported to be a staggering EUR 2.35 billion.
This monumental investment underscores a key trend in the lab-grown diamond sector: a heavy pivot away from the jewelry market and toward high-value industrial and technological applications.
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