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Alrosa Halts Polishing Divisions Indefinitely
May 10, 2020 6:02 AM
By Leah Meirovich
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RAPAPORT... Alrosa has shut all operations at its polishing units until further notice, as it waits for demand and health conditions to improve.
The closure affects the miner’s three manufacturing centers: its original two in Moscow and Barnaul, and the Kristall cutting division in Smolensk, which it purchased from the Russian government last year for $29 million. It does not plan to reopen the units until it deems the market viable.
“We suspended all polishing operations, and now continue to monitor global demand for polished diamonds, as well as the epidemiological situation in the regions where our facilities are located,” the company told Rapaport News last week. “The decision to launch operations depends on these two factors and will be considered every month.”
Including Kristall, Alrosa would normally expect to polish over 200,000 carats of rough per year, accounting for more than 60% of manufacturing in Russia.
Alrosa is also considering reducing its 2020 rough production from its initial plan of 34.2 million carats due to weak demand, it said. Last week, the miner reported it would suspend production at its Aikhal and Zayra pipes, two of its less profitable deposits. The board will vote on whether to decrease the output forecast at its meeting in May.
As of March 31, Alrosa had 21.1 million carats in inventory, “enough to balance production and demand if necessary,” it added.
Image: The Kristall polishing factory. (Kristall Smolensk)
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Tags:
Aikhal, Alrosa, Kristall, Kristall Smolensk, Leah Meirovich, Rapaport News, Zarya
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