Alrosa to Hold Back Supply in 2019

RAPAPORT... Alrosa plans to keep its rough-diamond sales in line withproduction in 2019 to avoid flooding the market with excess supply. The Russian miner will sell 38 million to 39 million caratsnext year, despite having more goods available in its inventory, a companyspokesperson told Rapaport News. "We will [have the ability] to sell 41 million caratsnext year, but based on recent demand and forecasts, we see no need to do it," thespokesperson said. Sales will still exceed the estimated 37 million to 38million carats Alrosa has sold in 2018, she added. The company is planning to raise production to 38 millioncarats in 2019, from the 36.6 million it expects to have mined this year. Ithas additional stockpiles of about 3 million carats left over from 2015, when aslump in demand led Alrosa's output to exceed sales by about 8 million carats,according to Rapaport calculations. Alrosa plans to hold back much of the excess to avoid a glut of roughdiamonds emerging in the midstream, the company explained. "We believe that it is useful for the market when supplyincreases gradually," the spokesperson added. De Beers expects its production to decline to between 31million and 33 million carats next year, compared with 35 million to 36 millionthis year, it said earlier this month.Image: Rough diamonds. (Alrosa)