MOSCOW (Reuters) - Russian diamond producer Alrosa said on Tuesday its sales of rough and polished diamonds dived 95% in April compared to the same month of 2019 due to the coronavirus crisis.
Sales fell to $15.6 million from $319 million in April 2019, the world’s largest producer of rough diamonds by carats said, after it “virtually stopped selling rough and polished diamonds” during the pandemic.
Sales were at $152.8 million in March this year.
“Restrictions imposed to fight the coronavirus and a decline in the demand for diamond jewellery have minimised the trade in rough and polished diamonds across the world,” Deputy Chief Executive Evgeny Agureev said.
But he said he expected the impact to be temporary. “We expect to see an upward trend in demand for diamonds as early as in the beginning of the third quarter.”
BCS Global Markets analysts also said they expected a recovery to start in the next quarter. “Weak diamond sales results by Alrosa in April was expected, as the diamond trade was practically paralysed during the month,” they wrote.
Shares in Alrosa remained broadly flat on the day.
Alrosa tried to partially offset sliding demand by offering online trade options and relaxing payment terms for contracts in March.
But the state-controlled firm’s March sales still fell 56% versus February and long-term contracts with several customers were terminated as they switched to spot purchases.
Russia’s Yakutia region, a major shareholder in Alrosa, proposed that state precious metals and gems repository Gokhran buy $1.7 billion of the company’s rough diamonds this year, the Interfax news agency reported on Tuesday, citing a source.
Reporting by Polina Devitt; Writing by Alexander Marrow and Polina Ivanova; Editing by David Goodman and Edmund Blair