Alrosa’s sales fell 38% year on year to $181.8 million in August, as weakness in the market persisted.
However, the result was an improvement on last month’s $170.5 million, the miner’s weakest figure since it began releasing data in 2016. It’s also the first time since 2010 that August proceeds were higher than in July, Evgeny Agureev, director of Alrosa’s United Selling Organization, noted Tuesday. Cutters and polishers began replenishing their stocks, supporting Alrosa’s sales during the month, he said.
“The diamond market is still experiencing headwinds from both macroeconomic and industry-specific factors, which have an adverse impact on the midstream,” Agureev explained. “There is also a seasonal slowdown weighing on the summer sales.”
Rough-diamond sales decreased 36% to $180.2 million for the month, while polished revenue plunged 87% to $1.5 million.
Alrosa’s sales fell 35% to $2.16 billion in the first eight months of the year. Revenue from rough stones dropped 35% to $2.13 billion for the period, while polished-diamond sales slid 48% to $34.6 million.
However, the miner maintained a positive outlook for the rough sector for the remainder of the year, as the oversupply in the market is easing.
“We are still expecting that after a significant decrease in rough-diamond supply by major diamond producers since the beginning of the year, the excess stock in the system is decreasing,” Agureev added. “This will help to restore supply and demand balance, which should not take too long.”
Image: Polished diamonds. (Alrosa)