Russian income from amber mining doubled have increased by more than 2 times compared to 2016 – such data are contained in the Rostec report for the third quarter of 2021. The recovery of the industry, which was in decline in the 1990s, began with the transfer of the Kaliningrad Amber Combine under the control of the state corporation. the largest enterprise in the world mining this gem. What results have been achieved in recent years and what are the prospects – in the material of “Izvestia”.
From decline to development
The Kaliningrad Amber Plant is the only enterprise in Russia and the largest in the world that extracts amber – in the 1990s and early 2000s it was brought to decline and bankruptcy. In 2014, by decree of Russian President Vladimir Putin, the plant was transferred to the management of the state corporation Rostec. This step became the starting point for reforming the entire amber industry.
An ambitious task was set: the world amber capital should not be in Poland or Lithuania, but in Russia, in the depths of which more than 90% of the world’s amber reserves are concentrated. This task implied the implementation of a set of measures to modernize production, increase the production of raw materials and the production of finished products, ensure equal conditions for market participants, and popularize amber.
The transformations of the enterprise and the industry were spelled out in the development strategies adopted in 2016 and 2017. at the corporate and federal levels. For several years of implementation of strategies calculated until 2025, the situation has been radically changed. Since 2016, 1.5 billion rubles have been invested in the development of the Amber Plant: the bulk of the funds were allocated for the purchase of new machinery and equipment (505 million rubles) and repair and construction work (638 million rubles). At the same time, the volume of investments increased more than 15 times – from 35 million rubles. in 2016 up to 550 million rubles. in 2021 (according to data for 9 months – Ed.).
The volume of tax payments to budgets of different levels from January 1, 2016 to October 1, 2021 exceeded 4.1 billion rubles. For 9 months of this year, the plant paid taxes and mandatory payments in the amount of more than 1 billion rubles, which is 2.6 times higher than the volume of similar payments in 2016. In 2020, the plant managed to fully repay all bank debts accumulated over previous years, which is almost 1 billion rubles, and in 2021 place more than 1.6 billion rubles on the deposit, which will be invested in further development.
Support for the amber industry
Since 2015, with the support of the Governor of the Kaliningrad Region Anton Alikhanov, who at that time held the post of Deputy Prime Minister of the Regional Government, the development of the plant’s trade and sales policy and the amber classifier began. In 2016, the plant began selling amber on the St. Petersburg stock exchange, which provided equal access to raw materials for representatives of the amber industry.
Every day about 15–20 tons of raw amber are put up for exchange trading. For 9 months of 2021, the Amber Plant sold 505 tons of products worth over 2.5 billion rubles. excluding VAT, of which 501.5 tons were sold on the stock exchange. Over the years, the share of exchange sales to companies registered in Russia ranged from 5% to 50%.
In recent years, the Amber Plant has carried out serious work in the field of improving the quality of raw materials. So, if earlier raw amber was sorted only by size, today there are 134 criteria in technological maps. This allows for the most accurate sorting of raw materials by grades, types and fractions. The company has a three-level quality control system. The corporate standard “Yantar”, which contains requirements for the quality of raw materials, is updated annually. Since 2019, the plant has introduced questionnaires for buyers to assess the quality of the purchased raw materials. In more than 95% of the questionnaires over the past three years, the quality of amber was rated “excellent”, there were no negative reviews.
As part of supporting local producers, the plant also holds auctions for various categories of amber processors – large companies, micro-businesses and artists. According to the Amber Plant, since 2018, 33 auctions have been held, at which 258.8 thousand kg of raw materials have been put up, 52.1 thousand kg have been bought out, which is only 20% of the set volume. Statistics show that the company offers up for sale to local processors a volume of amber 5 times higher than their needs, and speculations on the shortage of raw materials for local processors are untenable.
In 2021, a qualitative shift took place in the development of the amber industry in Russia. On July 22, the Kaliningrad Amber Combine and the Association “Cluster of the Kaliningrad Region Amber Industry” signed the first direct contract on the supply of 25 tons of raw amber of various fractions by the end of this year. The key condition of the agreement is the processing of raw materials in the region, which excludes the possibility of resale of raw materials. On October 1, 2021, the delivery of the first 5 tons in the amount of 41 million rubles took place, a second delivery is planned for the end of November – early December.
A similar condition may soon appear in export contracts. According to the Amber Combine, at the level of the Board of Directors, the issue of including in contracts with foreign partners a mandatory clause on the processing of a part of raw materials on the territory of Russia is being decided.
From raw materials to products
Not so long ago, a document was found in the archives of the Amber Factory, confirming that in the early 1990s the enterprise exported amber products to 46 countries of the world – from New Zealand to Iceland. In those years, the plant traded with the states of Europe, North and South America, the Middle East and Southeast Asia. Rostec intends to return the plant to world fame and enter the markets of dozens of countries, proving Russia’s leadership not only in the production of weapons and space technology, but also in the mining and jewelry industries.
Last year, the plant officially announced that it would increase the volume of processing at its own jewelry production. This became possible after the Amber Plant again became a full-cycle production: in 2020, the process of joining the subsidiary company Yantarny Yuvelirprom, which had been operating since 2004, was completed. The merger allowed the plant to invest in the expansion and modernization of the processing plant.
In July 2021, 7 months after the start of work, 6.5 thousand square meters were commissioned. m of production area of new workshops for deep processing of amber. More than 260 million rubles were invested in the creation and equipping of new jewelry production with the capacity of 50 tons of amber per year with modern equipment. At the same time, the annual revenue of jewelry production, according to forecasts for three years, will exceed 600 million rubles. (at the end of 2020 – 238 million rubles). For 2020–2021 more than 300 machine tools and various equipment were purchased for a total amount of 149 million rubles. At the first stage of expansion of production, 150 new jobs were created, and the work on attracting personnel continues.
According to the results of 9 months of 2021, the jewelry production of the plant produced more than 1360 kg of finished amber products (in 2016 – 967 kg). In the next three years, according to the plant’s forecast, the volume of finished products should double.
The high demand for amber in the world market allowed the plant to stabilize its financial position, carry out reconstruction and modernization, invest in development and lay a solid foundation for the progressive increase in the volume of internal processing of raw amber. The plant faces ambitious tasks to develop its own retail network and export products with high added value. The most promising in the field of amber jewelry sales at the plant are considered the countries of the Middle East – Kuwait, Qatar, Bahrain, the United Arab Emirates, Saudi Arabia. The management of the enterprise, in cooperation with the state corporation “Rostec” and the Ministry of Industry and Trade of the Russian Federation, is working to establish partnerships with the Middle East region.
In parallel with the development of its own jewelry production, measures to support the amber industry will be implemented. Local processors will be provided with the necessary volumes of raw materials, the plant assured.
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