Alrosa’s sales fell in the third quarter amid a drop in the average price as the miner sold a larger proportion of small stones, it reported Thursday.
Sales decreased 37% to $611 million for the three months ending September 30, as proceeds from both rough and polished diamonds declined. Rough sales slipped 37% to $601 million, while the average price for gem-quality diamonds slid 32% to $135 per carat. Sales volume contracted 5% to 6.4 million carats.
“Amid the declining demand since the beginning of 2019, diamond-jewelry producers and cutters have been actively reducing their polished- and rough-diamond stocks,” the miner added.
The market has softened compared with 2018, when Alrosa achieved record sales, it added, citing the US-China trade war as a contributing factor. But while it noted that “increased macroeconomic uncertainty” remained a challenge for the manufacturing sector, it reported an upturn toward the end of the period.
“The second half of [the third quarter] saw an upward trend in rough-diamond sales after a turning point in destocking, thus creating a basis for…market recovery in the future,” it said.
Rough output grew 15% year on year to 12.1 million carats for the quarter, with the company attributing the jump to “seasonally increased production at alluvial deposits” and improved yield from its Botuobinskaya pipe. It also cited the launch of its Verkhne-Munskoye deposit in the fourth quarter of 2018.
In the first nine months of the year, the miner produced 29.7 million carats, a 12% year-on-year increase. Sales for the period fell 34% to $2.39 billion.
Image: Alrosa’s Jubilee mine. (Alrosa)