The world’s largest producer of diamonds by volume has reported a quadrupling of profit for 2016.
Russian miner Alrosa said profit attributable to shareholders totaled 131.39 billion roubles ($2.25 billion) versus 30.67 billion roubles in 2015.
The firm, majority-owned by the Russian government, said it had witnessed a recovery in diamond prices.
“2016 was a year of active recovery in the diamond market following the decline of 2015.
“The Company managed to deliver record-high financial performance and generate net cash flow sufficient to repay short-term and medium-term liabilities and pay out dividends to shareholders,” said Alrosa’s chief financial officer Igor Kulichik.
In its November 2016 diamond market outlook, ABN AMRO said optimism was returning to the sector and the diamond trade should further improve across 2017.
The report argued that improvements in the U.S. economy would translate to higher demand.
“In the US there is a very clear relationship between net worth and jewelry retail sales.
“Demand for jewelry in the US has improved over the recent quarters,” the report reads.
ABN Amro said the U.S. is by far the largest market for diamond jewelry, accounting for 30-40% of the market.
It also noted that with fears of a Chinese hard landing abating, diamond export levels to China should continue to rebound.
