Alrosa, the Russian diamond mining giant, has reported a decrease in both sales and earnings for the first half of 2024. This drop reflects a broader slowdown in the global market, exacerbated by ongoing sanctions on Russian diamonds.
For the first six months of this year, Alrosa’s revenue fell by 5% compared to the same period last year, reaching RUB 179.47 billion ($2.01 billion). The company’s net profit also declined significantly, dropping 34% to RUB 36.63 billion ($411.4 million).
The company did not provide a detailed explanation for these declines but mentioned that the “sanctions pressure on the company and increased market volatility” are contributing factors.
Since the beginning of the Kremlin’s war in Ukraine in February 2022, the US and other Western nations have imposed sanctions on Russian diamonds. Although Russian rough diamonds continue to enter the market, Alrosa, a major supplier, has stopped disclosing sales data by destination.
The decrease in Alrosa’s sales comes at a time when there is a general slowdown in demand for both rough and polished diamonds. This slowdown is driven by weak retail sales in China and growing competition from synthetic diamonds. Despite these challenges, Alrosa’s sales decline for the first half of the year was less severe compared to that of competitors De Beers and Rio Tinto.
In the second quarter of 2024, Alrosa’s revenue dropped sharply by 34% year on year, totaling RUB 60.79 billion ($677.4 million). Net profit for the quarter plummeted 73%, falling to RUB 7.3 billion ($81.7 million).
