Diamond market overview
The general mood in the diamond market was positive over the past week. There was some caution about the level of returns from the main US market after leading retailer Signet reported disappointing holiday sales. Traders reported good demand in Asia ahead of the Chinese New Year, which kicks off on February 16. Meanwhile, Leading retailer Chow Tai Fook reported 12% sales growth in the last quarter of 2017. The main polishedprices index ended the week lower, opening at 115.94 on Friday, from Monday’s opening at 116.87.
Rough trading volumes are expected to remain subdued until the January sales of De Beers (January 22) and Alrosa on (January 15). Most traders are expecting a strong start of the year, as cutting centre stocks are down following the Christmas holiday sales season and Chinese New Year festivities.
Corporate and events
Russian miner Alrosa’s diamond sales fell to $4.27 billion in 2017, from $4.45 billion in the previous year, as the average price of its rough diamonds dipped, miningweekly.com reported. Reporting on the group’s 2017 sales figures, VP Yury Okoemov explained that the average price of rough diamonds sold by Alrosa was “a little lower than a year ago”, owing to changes in its sales assortment resulting from the increased demand for small-sized rough diamonds from the Indian diamond cutting sector in the first half of 2017, the miningweekly.com report said.
Signet Jewelers Ltd. saw its shares take a beating in premarket trade after its holiday sales numbers fell from a year ago, proactiveinvestors.co.uk reported. The diamond jewelry retailer revealed that total sales for the nine weeks ending December 30 fell by 3.1% to US$1.88bn from US$1.94bn a year ago, said the proactiveinvestors.co.uk report. During the same period, same-store sales also fell, more sharply by 5.3%, against 4.6% the previous year, it said.
Russian miner Alrosa, the world’s top diamond producer by output, received Friday approval from Angolan President Joao Lourenço to expand its stake in local producer Catoca, mining.com reported. The deal, worth $70 million, gives Alrosa a further 8.2% stake in Catoca Mining, providing the diamond giant with access to a production base outside Russia, said the mining.com report. The parties expect to complete the transaction in the next two months. Once finalized, Catoca will be 41%-owned by Alrosa, while Endiama — the National Diamond Company of Angola — will hold another 41%. LL International Holding B.V. will have an 18% stake, said the mining.com report.
The Lulo diamond mine is continuing to yield large diamonds, with Lucapa Diamond Company reporting that it had recovered its ninth 100 carat plus diamond at the Angola mine, miningweekly.com reported. The ASX-listed company, which mines Lulo with partners Endiama and Rosas and Petalas, reported the discovery of a 103 ct light brown diamond and an 83 ct Type IIa diamond, said the miningweekly.com report.
Photo © One +100 carat diamond discovered at Lulo mine.