Rough diamond sorting
Photo credit: De Beers
Diamond miners are gradually resuming operations and introducing new initiatives to support business as governments ease virus-led restrictions. Some companies however continue to enforce preventive measures in the face of the Covid-19 crisis. Here are some updates in the diamond mining industry.
De Beers Group
De Beers Group’s auctions arm launched a new online channel that allows registered buyers to purchase rough diamonds ranging from very high end to low end anytime, anywhere.
The Buy platform is one of several initiatives that De Beers Group’s Auctions business, which sells around 10 per cent of the group’s rough diamond supply, is undertaking to give buyers additional flexibility.
“We constantly seek additional ways of meeting our customers’ needs in a fast-moving world. We are especially pleased to introduce this additional flexibility for our registered buyers in light of the current Covid-19 situation,” noted Alastair Bickerstaff, head of product development and sales at De Beers Group Auctions.
Rio Tinto introduced Covid-19 testing for employees and contractors at its Diavik diamond mine in Northwest Territories, Canada. The onsite testing boosts precautionary measures already in place at Diavik, the company said.
Lucapa Diamond Company Ltd
Lucapa recovered a 171-carat gem-quality diamond from the Lulo alluvial mine in Angola as scaled mining operations resumed in early May.
The company earlier restricted mining activities at Lulo for four weeks amid the coronavirus pandemic.
Its latest find is the 15th +100-carat diamond recovered to date from Lulo and the second +100-carat gem recovered for 2020, according to the company.
Lucara Diamond Corp
Lucara said the diamond market could be poised for a recovery in the second half of 2020, citing leaner rough supply as well as improving demand in Asia.
Eira Thomas, president and CEO, commented, “Though our near-term outlook on diamond prices remains uncertain, global rough diamond production curtailments combined with early indications of polished diamond demand recovery in Asia provide some optimism that demand will improve in the latter half of the year.”
He said the company’s Karowe mine operates at full production but demand remains weak. Lucara reported a 30 per cent decline in first-quarter revenues to US$34.1 million. Volume-wise, it recorded a 10 per cent dip in the number of carats sold to 86,178, with an average price per carat of US$396.
Citing market uncertainties resulting from the pandemic, Lucara is also reducing a US$53 million capital budget originally allocated for its Karowe underground expansion project. It also suspended its 2020 guidance until further notice.
Mountain Province Diamonds Inc
Mountain Province Diamonds said sales reached US$49.2 million in the first quarter of the year, up 7.8 per cent from the same period in 2019. It sold 659,000 carats with an average per carat price of US$75.
According to Stuart Brown, president and CEO of Mountain Province Diamonds, the figure modestly exceeded expectations with higher values per carat realised in some categories. Its operations however were still affected by the coronavirus outbreak.
“The rapid spread of the Covid-19 pandemic toward the end of the quarter impacted our ability to operate normally and required significant changes to our procedures, which has had an impact on our production capabilities,” he noted. “We are in the final stages of completing our full year 2020 production outlook and will be providing new guidance in June.”
The company also cited as positive development the easing of restrictions in Europe and the gradual reopening of some business in India as well as enquiries it received from customers on when formal sales can resume.
Alrosa is temporarily suspending mining activities at the Aikhal underground mine and Zarya open pit from May 15 owing to a continued dip in global demand.
Mining at Aikhal will be put on care and maintenance until September 30, 2020 and until December 31, 2020 for Zarya. Zarya employs 180 miners while Aikhal has 502 staff members.
Any changes in its 2020 production plan will be discussed during a board meeting scheduled within the month. Alrosa said it intends to recommence production at the two sites as the market situation improves.
In 2019, Alrosa produced 2.6 million carats from the Aikhal and Zarya pipes.