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Diamond Breakage Dents Renard Prices
May 10, 2017 5:52 AM
By Rapaport News
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RAPAPORT... Prices at Stornoway Diamond Corporation’s Renard mine in
Canada lagged during the first quarter due to a high rate of diamond breakage,
the company said.
Sales since the mine’s launch yielded an average price of
$83 per carat, Stornoway reported in its maiden quarterly revenue statement
Wednesday, noting that its projected average price for the full year remained $100
to $132 per carat.
Production at the asset in Quebec started in October, with
the miner declaring commercial production on January 1. An initial tender in
Antwerp in November yielded a surprisingly high average price of $195 per carat
from the sale of 38,913 carats, as a liquidity crunch in India forced the
company to withdraw smaller goods from the event.
The company subsequently sold all of these lower-value goods
during the first quarter, resulting in a lower average price than in the
November sale. These three tenders and four contract sales between January and
March brought total sales to $35.4 million (CAD 54.5 million) for 498,039
carats.
“Achieved pricing in our first tender sales reflects the
higher-than-normal levels of diamond breakage that we have been experiencing
during the first months of processing ramp-up,” said Stornoway CEO Matt Manson.
“Pricing has also been impacted by better-than-expected
liberation of small diamonds and the market effects of Indian demonetization,”
he went on. “Nevertheless, we are seeing positive trends in both the quality of
our diamond production and in rough market pricing.”
Renard’s initial production has received a positive response
from the market, with reportedly high yields of polished diamonds coming from
the rough, Manson added.
The company has introduced measures to limit diamond
breakage and reduce the proportion of small diamonds recovered — a change that
it expects will lift the average selling price.
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Tags:
Canada, mines, mining, Rapaport News, renard, Renard mine, stornoway, Stornoway Diamond Corporation
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