Diamond Alliance

Sorting diamonds photo: ProfessionalJeweller.com

Alrosa, De Beers and Rio Tinto, the largest diamond companies, intend to create a diamond alliance. According to Kommersant , by the end of the year, five years after the cessation of trade relations, Alrosa will renew cooperation with De Beers. On March 24, the issue of Alrosa participation in the new project is submitted to its supervisory board. It is known that earlier the entry of Alrosa into the Association of Diamond Manufacturers (APA) has already approved the Strategic Planning Committee.

“The largest market players are concerned about reducing the demand for diamonds as a symbolic value and consider it necessary to develop a systematic approach to their promotion,” the newspaper source explained.

The initiative of the unification came from the three largest world -class diamond manufacturers - De Beers, Alrosa and Rio Tinto Diamonds. According to the source, all of 2014 they conducted confidential tripartite consultations, as a result, the main parameters of the project were agreed in December, and at the beginning of 2015 consultations were held with the participation of the Canadian Dominion Diamond Corporation, the South African Petra Diamonds and Grib Diamonds (100 percent “daughter” Lukoil, owned license to develop a mushroom tube in the Arkhangelsk region). If they also agree to enter the Association, then its participants will represent more than 70% of the global diamond -watering.

The Association of Diamond Manufacturers is proposed to register in the form of a non -profit partnership with a minimum staff. According to the newspaper, the total budget of the AP can be about 6 million euros.

Only those companies that are engaged in the extraction and implementation of natural diamonds and the reputation of which meets the UN business standards will be able to become members of the association. This means that these companies do not use slave labor and do not acquire diamonds obtained in the zones of military operations.

Each of the participants in the association will receive one vote in the Council of Directors, and the two largest players - De Beers and Alrosa - will have the right to have a veto, since their financial contribution will be significantly higher. The sources of the newspaper argue that the size of the contributions is not yet determined and will be formed as specific projects are launched. This, in particular, is about creating an information and analytical base for the mining sector, joint research of the retail sales market with diamonds and the analysis of consumer preferences. The publication notes that diamonds are now strictly competing with other luxury items (Luxury-electronics, fashion, travel), especially in the youth environment.

The association also plans to engage in the formation of the reputation of industry companies, since now they often face a lack of banking financing due to excessive closed. In addition, it is finally necessary to solve the problem of illegal penetration of synthetic diamonds into the market. At the same time, the sources of the newspaper argue that within the framework of the Association, the parties do not plan to discuss issues that fall under antitrast regulation, for example, pricing policy and clientele.

Igor Sobolev

Igor Sobolev mentioned the problem of synthetic diamonds the Executive Director of Alrosa back in 2014. “Everything that is made of artificial stone should not be called a diamond. Let them sell, but it should be their own niche, and people who want to buy a synthetic stone should come and buy a synthetic stone, realizing what exactly they buy. And those who want to buy a diamond should buy a diamond, ”he noted.

Until the end of the 1990s, the main expenses for the promotion of the diamond as a unique value were carried out by De Beers, which justified its monopoly dominance in the market. Until the mid-2000s, most of the global diamond manufacturers sold raw materials through the single-channel system De Beers (the last trading contract with Alrosa ended in 2009). After the disintegration of the de Beers sales system, the diamond marketing completely lay down on the shoulders of jewelry retail.

However, as noted by Sergey Goryainov from Rough & Police, retailers are interested in promoting the brand rather than material. The analysis of the cost of the Rapaport diamonds showed that from the beginning of the 1980s to the end of the 1990s, the price of a single-channel diamond increased by almost 50%, and since the late 1990s this increase did not exceed 1%. “For five years, Alrosa has been implementing an independent marketing strategy, but as an exclusively mono -product company, it is interested in increasing the demand and prices for diamonds and diamonds,” the expert added.

Alrosa is the largest producer of diamonds in Russia: the company accounts for 97% of the total production of diamonds in the country. The largest shareholders of the company are the state (with a share of 44%) and the Republic of Sakha (25%). In October 2013, Alrosa held an IPO and placed 16% of the shares on the exchange. The main activity of the company is concentrated in Yakutia, as well as in the Arkhangelsk region and Africa.

Ilya Ryashchin

On the eve of the acting Ilya Ryashchin president of the company said that Alrosa in 2015 is planning an early repayment of about a billion dollars in debt, as well as dividends for 2014 at the level of 2013.

“At the current rate of the ruble to the dollar, the cash flow will be sufficient for early repayment of debt in the amount of billion dollars in 2015,” Ryashchin explained. The total debt of the company at the end of 2014 increased to 197.160 billion rubles from 138.591 billion in 2013 and 122.701 billion in 2012.

Note that according to the results of last year, the company received a net loss in the amount of 16.8 billion rubles. Alrosa explained the negative financial result of a reassessment of part of the loan portfolio nominated in dollars, due to the devaluation of the ruble in 2014. The combined loss of the group from course differences in Alrosa was estimated at almost 64 billion rubles.

The sale of diamonds in 2014 increased by 4 percent to 39.6 million carats, and production decreased by 2 percent to 36.2 million carats. The average sales price was $ 171.4 per carat.

Boxes also noted that Alrosa retains a forecast for the growth of diamond prices in 2015 at 3%, despite the reduction in prices in the beginning of this year. This year, the company plans to sell 2 million carats from stock.

As it became known in February, Alrosa also intends to begin the development of gold deposits in Yakutia. “It is clear that no other company will come to these sites now. Accordingly, or no one will get these areas of gold or “Alrosa” or will not get, ”Yuri Trutnev then the president’s envoy to the President in the Far Eastern Federal District. It should be noted that earlier “ALROSA” did not engage in gold prey.

A few days ago, the media also reported that the intrigue with the appointment of the President of Alrosa is approaching permission. According to Kommersant, the head of the Ministry of Finance Anton Siluanov proposed the candidacy of the deputy head of Gokhran Andrei Zharkov, which he managed to coordinate with interested departments and the supervisor of the Deputy Prime Minister Yuri Trutnev.

In Gokhran, Andrei Zharkov is responsible for the acquisition of values ​​to replenish the State Fund of Russia, as well as engaged in the procurement of dragkamny. The official oversees several departments - the budgeting of the State Fund, for working with the values ​​of the State Fund, as well as the management of Gokhran affairs. In addition, he has been heading the board of directors of Smolensky for Crystal for three years, the largest ribbon in Russia.

The final decision on the candidacy of the head of one of the world's largest diamond companies will be taken by President Vladimir Putin.

See also: “ALROSA” will resume cooperation with De Beers “Alrosa” demanded the admission of the media tolerate the ex-head of AvtoVAZ to the golden chapter for the chair of the President of Alros