RAPAPORT... Alrosa has raised its production plan for this year amid buoyant rough demand and a tight supply situation.
The miner will recover around 32.5 million carats in 2021, compared with a previous outlook of 31.5 million carats, it said Thursday in its quarterly earnings report. The increase had been under consideration since earlier this year, as rough sales have soared and inventories have slumped.
Diamond miners were initially able to meet the strong demand by selling goods they had amassed in 2019 and 2020, explained Alrosa chief financial officer Alexey Philippovskiy.
“By the start of [the third quarter of 2021], producers had run out of their stocks and began supplying ‘freshly’ produced diamonds,” he noted. In the coming years, however, global production will be around 20% to 25% below pre-pandemic levels, he cautioned.
Alrosa’s revenues jumped 56% year on year to RUB 75.66 billion ($1.06 billion) in the third quarter, reflecting the market rebound, even as shortages limited the company’s ability to sell. Net profit more than tripled to RUB 24.98 billion ($351.2 million) versus RUB 7.58 billion ($106.5 million) a year earlier.
Image: Rough diamonds and a loupe. (Alrosa)
Source: Rapaport 11-11-2021
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