Moscow: ALROSA said it expects rough-diamond production to increase significantly this year amid optimism in the rough market.
The miner anticipates it will recover 39.2 million carats in 2017, the company said in a presentation to investors, implying a rise of 6 percent over the 37 million carats that were planned for 2016.
The latest guidance is still a 2 percent reduction from an earlier plan of 39.9 million carats for this year. Lowering the outlook was an executive business decision approved by the Russian company’s board, an ALROSA spokesperson said.
The expected increase comes amid a recovery in the rough market, with De Beers reporting a 32 percent jump in sales at its January sight mainly due to manufacturers’ post-holiday restocking. Analysts at VTB Capital forecast ALROSA’s revenue will increase 2 percent to $5.46 billion (RUB 323.33 billion) in 2017, driven by a resurgence in the sector.
“Robust demand for rough in the first half of 2017 is set to support revenue-growth momentum for ALROSA, as a result of which our full-year 2017 forecasts might prove conservative,” the Russian investment bank said.
ALROSA’s rough production is projected to rise to 39.9 million in 2018 and to peak at 41.5 million in 2019, according to company projections.