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Gemfields' Auction Nets $9M in Jaipur
Jun 20, 2012 7:29 AM
By Dilipp S Nag
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RAPAPORT... Gemfields raised $9 million from its auction of predominantly lower-quality rough emerald and beryl in Jaipur between June 9 and June 13, 2012.
The company offered 10.85 million carats for sale of which 3.47 million carats were sold. Twenty five companies attended the auction and 20 of these placed bids on the goods. The auction yielded an average of $2.61 per carat for the lots sold.
Gemfields, however, noted that this figure is artificially inflated by the number of low-quality lots that remained unsold due to weaker demand experienced at these value points, with the current per carat value of this quality having been largely stable over the past six months.
“General economic instability typically has a greater negative impact on the lower-quality grades than it does on the higher-quality material, the latter often being seen as a store of value in times of uncertainty,” said Ian Harebottle (pictured), the chief executive of Gemfields. “This effect was clearly seen at this auction, where demand for the lowest-quality grades was indeed weaker than it has been for some time.”
The pricing was further negatively affected at the auction as the Indian rupee weakened against the U.S. dollar by 13 percent between November 2011 and June 2012, the company said. This was because the large percentage of finished goods produced from this rough is likely to be consumed directly within the Indian domestic retail market, it noted.
In a similar emerald auction held in November in Jaipur, popularly known as the Pink City of India as well as for its heritage jewels and gemstones, Gemfields raised $11 million for 9.8 million carats, achieving an average of $1.12 per carat for the lots sold.
The company stated that the last week’s auction was the fourth and final auction of the current financial year that ends on June 30, and it has generated sales of $77.9 million from the four auctions this year.
Harebottle stated that Gemfields was not obliged to sell lots at sub-optimal prices due to its strong cash position and operational performance and is confident in the long-term value of these gems. The company noted that there is solid demand for its ethical Zambian emeralds.
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Tags:
auction, Dilipp S Nag, emerald, Gemfields, Ian Harebottle, India, jaipur, Rapaport, rough, Rupee
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