Alrosa Taking Diamond Payments in Rubles

RAPAPORT... Alrosa has accepted payment for diamonds in Russian rubles as partof a pilot program, the miner said Thursday.The process is potentially faster and simpler than dollartransactions, the more common method for international rough-diamond sales, thecompany noted. That's because the money goes to branches of Russian banksoutside of the country, rather than having to involve other financial institutions,it explained."The experience is positive, so we will apply it on an as-neededbasis," reported Evgeny Agureev, director of Alrosa's United Selling Organization.Receiving more sales proceeds in rubles would also hedge Alrosa against currency fluctuations: The weak dollar was one of the reasons why Alrosa's revenue and profit fell last year, as the company mainly sells diamonds in the US currency, but its costs and earnings reports are in rubles.The purpose of Alrosa's pilot was to establish whether and how itcould implement this alternative method of payment, Agureev added. Clientsfrom India and China participated in the experiment.A Chinese buyer bought goods at an Alrosa auction of rough stonesabove 10.8 carats in Hong Kong in June, and paid for them in rubles through Russianlender VTB Bank's Shanghai branch. In another case, a long-term Indian clientof Alrosa paid for a scheduled supply of diamonds by transferring the amount inrubles to its account with a different Russian bank.Image: Alrosa