Diamond market overview
There was positive sentiment in the polished market, following healthy sales during the all important holiday season in the main US market. US holiday sales during November and December rose 5.5% compared to the same period in 2016. The US National Retail Federation (NRF) attributed the rebound to growing wages, stronger employment and higher confidence, which led consumers to spend more than had been expected. Tax cuts also contributed to increased spending, it said. “We are confident that retailers will have a very good year ahead,” NRF said in a statement. Meanwhile, Tiffany reported strong sales growth for its jewellery and watches over the holiday period and said it expects overall annual sales to increase by about 4%. Previously, it had projected growth in the low single digits. The main polishedprices index strengthened over the past week, opening at 116.84 on Friday, from Monday’s opening at 115.94.
Rough traders reported brisk trading ahead of the De Beers sight this coming week and during the Alrosa sales this past week. Buyers reported good demand during the Alrosa sale. The state Russian company reportedly raised prices by around 2% overall.
Corporate and events
A 910 carat diamond recovered at Gem Diamonds’ Letšeng mine in Lesotho could fetch more than $40 million and help support the firm’s under-pressure balance sheet, miningmx.com reported. Shares in GEM gained 13% in early morning trade on the London Stock Exchange. On a 12 month basis, however, the company has lost a fifth of its value, said the miningmx.com report. “We currently forecast Letšeng to achieve an average realised price of $2,452/ct and earnings before interest, tax, depreciation and amortisation of $104 million in 2018, which includes the recovery of large high value diamonds normalising to historical levels,” said Edward Sterck, an analyst for BMO Capital Markets, the miningmx.com report said.
Namibia’s top diamond producer, Namdeb, a 50/50 joint venture company between the country’s government and De Beers, has begun offering early and voluntary retirement to at least 130 of its 1,700 workers, Xinhua reports, according to mining.com. According to the agency, the move seeks to ensure the sustainability of Namdeb land-based operations, which is facing potential sales, Mineworkers Union of Namibia Oranjemund branch chairman, Mbidhi Shavuka, told The Namibian Sun (subs. required) in November, the mining.com report said.
Tiffany & Co. posted a rebound in its holiday sales, helped by a new home and accessories collection that included $90 black pencil holders, $275 silver shaving brushes and $450 rulers, Bloomberg.com reported. Same-store sales, a closely watched benchmark, rose 3 percent in the final two months of 2017, the New York-based retailer said on 17 Janaury. Tiffany had reported a decline of 1 percent in the previous year on that basis, the Bloomberg.com report said.