Alrosa, the world’s largest diamond miner, said that global supplies would remain tight for several years due to mine closures and a shortage of new projects, the Financial Times reported.
The Russian state-controlled diamond producer said its inventories have fallen to historic lows as demand has returned from last year’s COVID-19 disruptions, Evgeny Agureev, deputy chief executive of the company, told the paper in an interview.
“Our industry will work with limited supply,” he said. “There are projects, but these projects will not provide goods next year or the year after.”
“From one side, it’s a challenging situation because there is demand and limited supply. But on the other side, it’s a good situation because the market will [not] experience overproduction problems.”
In a third-quarter production update released earlier this month, Alrosa noted that the rough diamond price index had returned to 2018 levels, with polished diamond prices surpassing the 2018 average.
Alrosa produced 8.8 million carats in the third quarter and generated US$938mln (GBP681mln) from the sale of rough and polished diamonds.
It said that jewellery demand is strong in all the key markets.
“The market is optimistic about the upcoming Christmas season, which in the US will see an earlier than usual start this year. Jewellers started placing orders for polished diamonds as early as July,” it said in its October 15 update.