Peregrine Diamonds Ltd. PGDIF

RE:RE:De Beers cutting production

[ekim]

The article does state that the polished supply issue seems to be biggest in India.

The supply/balance is much better in the USA where the polished diamond supply is more in balance.

The USA market likes the 1 to 3 carat range...apparently different regions have different wants when it comes to diamonds....hence the strength in that category.

One counter would be that the CH-6 has as production profile that 10% of the diamonds will be greater than 2 carats. The average world diamond mine only has 5% of the diamonds greater than 2 carats.

We've already seen very high gem quality and cuttable diamonds that would easily be cut and polished into the 1 to 3 carat range for the US market.

That is just 1 argument....and I think it still goes to show you the quality difference between's NAR's diamonds and CH-6's diamonds visually is huge.

Moreso then De Beers...I think the biggest question mark has been ALROSA.
They produce a lot of diamonds and have a big phat capital budget (aka Russian government) to do what they want. With the depreciation fo the Russian rouble...I'm sure cutting production isn't necessarily in the minds of Alrosa.

Thought of a second argument as well.

With many of the Diamond mines going underground. The expenses will be higher and they will be more affected by the softening of diamond prices.
UG mines will shut down production before open pit mines do (generally speaking).
Chidliak will be open pit for at least the first 5 to 10 years.

LONG...PGD

EKIM