Demand for gold from Russians gives Polymetal boost

The gold and silver miner is listed in London but its mines are in Russia and Kazakhstan, where it is also listed.

Gold demand has risen in Russia. (Niall Carson/PA) (PA Archive)

Anglo-Russian gold and silver miner Polymetal said it has seen a hike in demand from Russians trying to stash their cash in gold.

The business said that it was still able to sell gold from Russia to East Asia and Kazakhstan, despite crippling sanctions on Russia from Western countries.

While export opportunities to Europe and the US have dropped, Polymetal said that Russian retail customers – that is to say individuals rather than banks and other institutions – have been snapping up the precious metal.

“Domestic demand for gold is boosted by local retail investment,” it said in an update to a worried London stock market on Wednesday.

Shares in Polymetal have cratered since Russia launched a full-scale invasion of Ukraine over a month ago.

Before renewed hostilities broke out on February 24, shares in the business were trading at around 1,100p each.

On Tuesday they closed at 340p, having recovered from sub-100p lows earlier this month.

The business said: “In Russia, sales of gold and silver concentrates continue normally to East Asia and Kazakhstan.

“Shipments have been temporarily impacted by the change of freight and logistics service providers, which is likely to result in higher costs.

“Sales of gold bullion in Russia have been restored to new counterparties on terms consistent with those received earlier.”

After its entire board left the FTSE 100 listed firm appointed five new independent directors and a new chair. Shareholders are set to meet to vote on the appointments on April 25.

New chair Riccardo Orcel said: “It is my opinion that investors, private and institutional, that collectively control over 75% of this company deserve a board that will lead the company through this turbulent time, preserving and hopefully rebuilding the value of their investment as well as protecting the livelihood of thousands of employees, contractors, suppliers and other stakeholders.”