Diamond & Specialty Minerals Summary for April 5, 2024
2024-04-05 15:32 ET - Market Summary
by Will Purcell
The diamond and specialty minerals stocks box score on Friday was an upbeat 107-71-132 although the TSX Venture Exchange rose five points to 584. This is becoming an all too common refrain, but last week's glimmer of optimism about rough diamond prices was once again more mirage than mirror, according to Paul Zimnisky's global rough diamond price index.
Last week, we applauded a 0.3-point rise to 149.5 points on Mr. Zimnisky's chart, although late-to-arrive data had lowered the index from a previous 149.7 points. This week, we are again cheering the index at 149.5 points. While there was no tardy data to lower the floor as has so often been the case over the past year, neither was there any gain in prices this week. Either way, the gyrations aside, the rough diamond price chart remains flattish for nine weeks now, as diamond miners and promoters aching for the promised upswing to begin undoubtedly feel like a hamster dashing along on a wheeled treadmill.
Yes, the index began the flat period at 148.4 points late in January, and it entered April at 149.5 -- a rise of 1.1 points or 0.7 per cent over that stretch. Even so, compared with the cliffs, crags and crevasses that adorn the past four years of Mr. Zimnisky's charts, the gentle rise is akin to the imperceptible slope across a prairie farmer's field. Still, a plateau is better than the crevasse that mars the charts of synthetic diamond prices.
A few decades back, a Russian fellow said he had invented a way to make synthetic diamonds on the cheap. Curiously, he offered the machines for sale, not the gems he supposedly could make. In hindsight, that was likely the wiser decision, as today's manufacturers of man-made diamonds are struggling financially, as prices for their goods fall faster than they can make them.
And so, mining analysts and diamantaires enthuse that the market for natural, mined diamonds has totally disconnected from the synthetic sector. No, man-made gems are not cubic zirconia -- they are real diamonds -- but gemologists can tell them apart and so the disconnect is likely to get stronger. At least that is the hope. Not everyone agrees with Mr. Zimnisky or Martin Rapaport that mined diamonds will gain value in the coming months and years, so keep an eye on the market.