Russia’s Finance Ministry is reportedly evaluating the potential acquisition of additional rough diamonds from state-controlled Alrosa in 2025, with the purchases made through Gokhran, Russia’s State Precious Metals and Gemstones Repository and with the intention of supporting Alrosa’s liquidity given current market challenges.
Russia’s Deputy Finance Minister Alexei Moiseyev confirmed that discussions are underway, stating, “We are considering this possibility… In order to allow Alrosa the opportunity to be calm and not feel obliged to sell on the market in order to maintain its liquidity position. Because the market looks alarming.”
Alrosa’s Financial Stability and Government Support
Alrosa, one of the world’s largest diamond producers, has been facing pressure due to fluctuating demand and broader economic uncertainties in the global diamond trade. The government’s proposed diamond purchases aim to prevent Alrosa from selling at unfavourable prices, helping maintain its financial stability.
“The diamond market is currently under pressure, and we are exploring ways to prevent Alrosa from having to make sales under unfavourable conditions,” Moiseyev elaborated. This reflects the government’s plan to support Alrosa during a period of market volatility.
Budget Allocation for 2025 Purchases
To finance these acquisitions, Russia plans to allocate funds from the state budget for precious metals and gemstones. The maximum expenditure limit is set at 51.5 billion rubles (approximately $540 million USD) for 2025, with part of the budget aimed at supporting domestic diamond production.
Earlier in 2024, the Finance Ministry and Alrosa concluded an agreement for the purchase of a portion of the company’s rough diamond output. This led to the acquisition of an initial consignment, though no further transactions have been publicly reported since. The absence of additional 2024 purchases has been noted, with Moiseyev commenting that “there are no plans for this year, though we are considering the possibility for next year.”
Confidentiality of Future Transactions
Moiseyev indicated that these discussions are largely confidential, adding that final decisions regarding 2025 purchases may not be publicly disclosed. This approach is not unusual in government dealings involving strategic national assets like diamonds, where market-sensitive information can influence both domestic and international trade dynamics.
Implications for the Jewellery Industry
For jewellers and the broader industry, the potential increase in government-backed diamond purchases could have significant implications. By supporting Alrosa’s liquidity, these actions might prevent further downward pressure on diamond prices. In turn, this could contribute to more stable market conditions for jewellers and manufacturers dependent on the availability and pricing of rough diamonds.
