Alrosa sales revenue up 49% as diamond demand outstrips supply

MOSCOW: Russian diamond producer Alrosa’s sales revenue jumped by 49% to $4.2 billion last year as demand exceeded supply and helped the company to recover from the hit it took at the start of the COVID-19 pandemic, it said on Friday.

Alrosa, the world’s largest producer of rough diamonds and a competitor of Anglo American’s De Beers, raised 2021 production by 8% to 32.4 million carats as it increased output at deposits in Russia’s far east.

“Demand for rough diamonds outstrips the supply. Following completion of the Diwali celebration, cutters in India have ramped up production to prepare for restocking by jewellery companies after the Christmas season sales,” Alrosa said in a statement.

The bulk of global diamond cutting and polishing operations are located in India.

Alrosa’s average price index rose by 12.5% in 2021, the state-controlled miner said, adding that global prices remain supported by high jewellery demand, declining inventories in the diamond sector and muted production capacity.

It expects global annual production of rough diamonds to remain at 110 million to 120 million carats in the mid-term, compared with pre-pandemic levels of 140-150 million carats.

Alrosa’s 2021 diamond sales rose by 42% to 45.5 million carats thanks to sales of part of its previously accumulated stockpile. This decreased its stockpile to 8.8 million carats at the end of 2021.

Courtesy: Economic Times