Russian diamond mining company ALROSA has announced that it is temporarily suspending the distribution of rough diamonds for the months of September and October 2023. This decision follows a request from the Gem and Jewellery Export Promotion Council of India (GJEPC).
Russian diamond producer Alrosa has suspended its deliveries of rough diamonds for September and October in response to a request from India’s leading trade body, the Gems and Jewellery Export Promotion Council (GJEPC).
Indeed, prices for small commodities, a field in which Alrosa is a leader, have been hit in turn in recent weeks by the global slowdown that has long affected large stones.
“This decision has been taken against a backdrop of concern about falling demand for diamonds on international markets, which is leading to interruptions in factory work,” the organization explained.
According to Vipul Shah, president of the GJEPC, the measure is aimed at preventing a glut on the world market and keeping diamond prices stable, given the relatively low demand. “The trade body contacted several global mining companies earlier this month to discuss concerns related to the diamond trade.”
Shah also reported that the GJEPC had initiated discussions with De Beers, the leading diamond producer, which has pledged to “offer full flexibility to all its customers”. De Beers confirmed its willingness to maintain a responsible approach to the sale of rough diamonds, adapting its supply to demand, including the possibility of deferring purchases and buy-backs.
Stabilizing the supply chain
Alrosa, which has been affected by EU sanctions linked to the conflict in Ukraine, stressed that this suspension would “contribute to reinforcing the stability of the rough and polished diamond supply chain from the beginning of next year”.
The decision comes as the Group of Seven (G7) plans to announce a ban on Russian diamond imports in the next two to three weeks, with the aim of reducing Russian funding of the war in Ukraine. The implementation of this plan could potentially disrupt the global diamond supply chain, but its success will largely depend on India, which is responsible for the diamond industry employing millions of people and cuts and polishes 90% of the world’s diamonds.
India’s gemstone and jewelry exports fell by almost 4.4% in value between April and August this year, to $12.4 billion year-on-year, according to government data. This drop in exports is attributed to relatively weak demand for polished diamonds from major consumers such as the United States and China, Shah said.
Western sanctions
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