Rough Diam Prices (Fri, 04 Mar) - Mentioned by Will Purcell Oh my! Paul Zimnisky's global rough diamond price index retreated for the second week in a row, putting it down 0.7 per cent from a record high set two weeks ago. Late-arriving data did wipe out a portion of last week's drop, but with post-holiday enthusiasm now abating, it is possible that the decline could stick. If so, that could hardly come as a shock since rough prices are up 70 per cent from their pandemic lows of early spring, 2020, and they are over 25 per cent above their values of late 2019 and early 2020, before the pandemic hit.
Perhaps Mr. Zimnisky will again revise his way out of this latest inflection point, just as his index did last summer when it looked like prices had peaked in August. If not, history suggests that rough prices could be in for a long stretch of sideways motion, or gradual declines, much like what followed the two-year surge in prices on the heels of the Great Recession, a decade ago.
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Meanwhile, Mountain Province Diamonds is pleased with its rough diamond marketing and is looking to take advantage of strong demand and high prices for rough through a new arrangement with Chow Tai Fook Jewellery Group Ltd. According to the deal, Mountain Province will "provide a select range of diamonds over a one-year renewable term."
Mountain's vice-president and head of diamonds sales and marketing, Reid Mackie, was "extremely proud" of the arrangement, which he calls an "exciting opportunity for us to partner with a recognized industry leader" -- brace for a tongue-bath of praise -- an industry leader that Mr. Mackie lauds for "its discerning approach to diamond sourcing, unwavering focus on production excellence, and extensive retail network across Asia and the United States."
Suffice it to say that Mr. Mackie is plenty pleased, although the agreement with Chow Tai Fook does not appear to offer any of the value-added incentives provided by an agreement between Lucara Diamond Corp. (LUC: $0.70) and HB Antwerp, one through which Lucara gets to participate in some of the profits resulting from HB cutting and polishing the gems it buys from the company.
Mr. Mackie has plenty to cheer about elsewhere, as Mountain Province has concluded its best diamond sale yet. The company's auction through Bonas Group in Antwerp saw it sell 322,547 carats for $41.4-million (U.S.), about $128 (U.S.) per carat. The gems were only a bit better than normal, as the company says that once adjusted for the mix of goods sold, its calculated run-of-mine price was a pleasant $126 (U.S.) per carat -- by far its best result since the mine opened in the fall of 2016.