The situation in the market at the end of the outgoing year can be characterized simply - the market, as it was imagined in August, no. There is no understanding of demand, huge flows across the pipeline, no credit money, the aggregate of all these factors gives a logical result - there is no price. Consequently, the main intrigue of the first months of 2009 will be the struggle for price.

Soon the market will understand what the real dynamics of demand for products with diamonds, and on the basis of this, manufacturers and dealers will form their own consumer list.

Equally entertaining is the situation in the foundation of the market - mining. The diamond-dependent countries in Africa are unlikely to show long-suffering, as this is a matter of the revenue side of national budgets. In addition, the cost of developing African deposits allows them to sufficiently "go" down the price. De Beers traditionally aims to prevent uncontrolled pricing. However, today their authority and influence on African governments may not be enough.

The diamond sector is a relatively small part in the budgets of Rio Tinto and BHP Billiton, but the financial condition of these companies today is far from ideal and it is unlikely that efforts to save this part of the business are priorities for them.

In these conditions, Russia's position is significant, extracting more than all diamonds in the world in karat calculus. This position, apparently, is that by the end of the outgoing year, ALROSA has left the market. Objectively, the Russian company possesses all the attributes necessary for such a step: its deposits are located on the sovereign part of Russia, the company itself is owned by the state and enjoys its support, which is the possibility of buying out the raw materials extracted by ALROSA by the state. And most importantly, ALROSA is probably more interested in preserving the high cost of raw materials, since the cost of production in the extreme climatic conditions of Western Yakutia can not be compared with Botswana or Namibia. It is clear that the reserves of ALROSA, which allow it to work in stock and not thus reduce prices, are also not endless. The financial "cushion" ALROSA Gokhran is able to provide depends significantly on the world prices for hydrocarbons - the basis of Russia's exports and budget. If the price of Urals is below $ 40 per barrel in the next 4 to 6 months, the prospects for purchases of diamonds from your company by the Russian state will worsen.

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