Weekly Digest: De Beers rough sales, Rio Tinto Argyle prospects and export increases for Belgium
In this week’s round-up of headlines from the international diamond and diamond jewellery industries, Alrosa reports strong February sales, Rio Tinto considers the long-term opportunities for its Argyle mine and De Beers reveals its Cycle 2 rough diamond sales results.
Strong Alrosa February diamond sales buoyed by Chinese demand
Alrosa’s rough and polished diamond sales were $541.9 million in February, bolstered by good demand before the Chinese holiday season, the Russian miner said.
“In February, the core diamond markets were quite strong,” Yury Okoemov, deputy CEO, said in a statement.
He continued: “The diamond-cutting sector continues [to replenish] its stock. Demand for diamond products was also backed up by good jewellery sales in China on the eve of the Chinese New Year. Prices for diamonds in most size categories grew in January and February.”
De Beers rough diamond sales edge up in Cycle 2
De Beers announced a slight increase year-on-year in rough diamond sales for the second Cycle of 2018, reporting turnover of $555 million, up from $553 million in the second Cycle of 2017.
The first Cycle of 2018 notched up sales of $672 million.
“The second sales cycle of the year saw the continuation of good rough diamond demand,” Bruce Cleaver, CEO of De Beers Group, said on March 6.
“This was in line with expectations, following strong retail sales of diamond jewellery during the U.S. holiday season and positive early signs for consumer demand over Chinese New Year.”
Belgium’s polished diamond exports rose in January
Polished exports jumped 29% year-on-year to $813.4 million and, by volume, rose 21% to 352.1 million carats. The average price grew 6% to $2,310 per carat.
Polished exports to the US surged 48% to $275.4 million, while shipments to Hong Kong soared 95% to $144 million. Those increases outweighed a 5% decline in exports to Israel to $102 million.
Rio Tinto reduces diamond outlook at Argyle mine
Rio Tinto has lowered its estimate of diamonds it can viably extract from the Argyle mine in Australia after experiencing operational difficulties.
As reported by Rapaport, the asset’s ore reserves slumped 45% to 16 million tonnes at the end of 2017 versus a year earlier. This translated to 38.5 million recoverable carats at a grade of 2.4 carats per tonne of ore.
The decrease includes almost 5 million tonnes of ore that Rio Tinto depleted during the year at the mine in Australia. It comprises a further 3 million tonnes due to reduced production outlook resulting from operational challenges in 2017, the company said.
Rio Tinto also cut its price expectation for the mine for 2020 and 2021, resulting in a higher “economic shut-point” — the minimum volume it must produce per quarter for operations to be worthwhile. The available reserves will enable Argyle operations to continue until 2020.
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Words by David Brough
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