The persistent slump in the global rough diamond market showed no signs of abating in July, as Alrosa's rough sales fell to a low not seen in several years. The Russian mining giant sold $164.6 million in rough diamonds in July, falling another 25% below 2019's previous low in June ($219.3), and 51% lower than the $333.8 million earned in July. 2018. For the year to date, Alrosa's sales have declined 34% compared to last year, falling to $1.95 billion from $2.97 billion a year ago.
“A significant decline in diamond sales was attributable to a number of factors including a sizable level of diamond inventory overhang in the midstream built-up last year on abnormally high demand growth," said, Evgeny Agureev, Director of the United Selling Organization ALROSA, member of the Executive Committee. He adds that the situation was "exacerbated by low availability of credit facilities issue experienced by the midstream, trade tensions between USA and China, and other factors."
Alrosa further notes that it is providing flexibility to sales strategy in an effort to reduce the pressure on the market. On a positive note, Agureev comments, "Recent statistics on the net imports of rough diamonds to India and net export of polished diamonds from this country suggest that the diamond market is gradually coming back to supply-demand balance.” Alrosa did report that July was its second-best month of the year for sales of polished diamonds, achieving $5.9 million and also outpacing the $5.3 million in sales of polished goods in July a year ago.