Chow Tai Fook and Alrosa Sign Long-Term Rough Supply Agreement

(IDEX Online News) – Russian diamond miner Alrosa has signed a two-year agreement to supply rough diamonds to Chinese jewelry manufacturer Chow Tai Fook Jewellery Group.

At the official signing in Moscow on November 13, Chow Tai Fook executive director Conroy Cheng said, “The greatest challenge for all diamond industry players is the scarcity of authentic natural diamonds. The agreement with Alrosa enables us to secure more reliable supplies of rough diamonds, particularly those specifications that are in greatest demand from our customers.”

According to Alrosa president Fyodor Andreev, the agreement is a step towards geographical diversification for the company, which the company believes is imperative.

“Alrosa’s priority is signing long-term agreements with large companies, since such agreements guarantee stable sales volume to us, as a producer, and guarantee stable rough diamond supply to a customer,” said Andreev.

Chow Tai Fook is a Spot Term customer of Alrosa. The agreement is Alrosa’s first long-term supply contract with a company from China.

Chow Tai Fook Jewellery Group is a vertically integrated company comprising diamond-cutting factories, manufacture of jewelry and watches, with more than 1,600 points of sale in China, Singapore and Malaysia. The company has been a DTC Sightholder since 1993 and a Rio Tinto Select Diamantaire since 2009.

In its last fiscal year the company reported a surge in revenue and profit. Revenues leaped 61.4 percent to HK$56.57 billion ($7.79 billion) while profit for the year ended March 31, grew 79.2 percent to HK$6.34 billion ($817.2 million).