RAPAPORT... Hong Kong-based Chow Tai Fook Jewellery Group has signed a two-year contract to procure rough diamonds from ALROSA.
“The greatest challenge for all diamond industry players is the scarcity of authentic natural diamonds,” said Conroy Cheng, Chow Tai Fook’s executive director. “The agreement with ALROSA enables us to secure more reliable supplies of rough diamonds, particularly those specifications that are in greatest demand from our customers.”
Fyodor Andreev, ALROSA’s president, said the deal would help the mining company achieve greater geographic diversification. He noted that Chow Tai Fook has already been an ALROSA customer on a ''-spot-term'' basis but this agreement marks the mining company’s first long term contract with a diamond firm from China.
According to ALROSA’s latest interim report, its sales to China rose 18 percent year on year to $49 million (RUB 1.55 billion) in the first half of 2012, accounting for 2 percent of total sales. “We believe this market has great potential in terms of the growth in diamond jewelry consumption as well as demand for rough diamonds,” Andreev said.
Kent Wong, the managing director of Chow Tai Fook, said the partnership will help the jewelry retailer achieve its goal to increase its procurement of rough diamonds. Chow Tai Fook is also a De Beers sightholder, receiving goods at the De Beers sights in London, Botswana and South Africa, as well as a Rio Tinto Select Diamantaire.
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