Firestone Diamonds Expects Market To Improve In Medium Term After Stable Q3
October 23, 17
(IDEX Online) – Firestone Diamonds plc expects market conditions to improve in the medium term in a report on the quarter ended 30 September for production at its Liqhobong Diamond Mine.
"The overall market environment has seen a combination of oversupply and the previously reported Indian de-monetization program which is still having an impact on the Run of Mine goods (+11 diamond sieve and smaller). In addition, the summer months are traditionally the quietest time in the rough selling season.
Stuart Brown, Chief Executive Officer, commented: "Production for the quarter has been very stable, we ended the quarter slightly above all our anticipated production targets. While the previously announced average value per carat was somewhat disappointing this is reflective of the combination of the lower than expected occurrence of better quality diamonds recovered during the quarter, the widely reported current market conditions where sales are weaker in the finer sizes and weaker demand due to the time of the year.
"We have started moving to other areas in the pit and as expected, we have seen the start of some improvement in average value per carat recovered. However, as highlighted in previous announcements, mining will progress into all areas of the pit in time and it will be some while before more representative volumes of all the ore types are mined and we can better establish our revised average value per carat for planning purposes. As with many diamond deposits, the average value realised per carat may continue to show significant variability on a sale by sale basis. Pleasingly, the quarter ended on a highlight with the announcement of the recovery of our second plus 100 carat stone at the end of September."
A total of 195,330 carats were sold in the quarter including Liqhobong's second >$1 million stone, a 45 carat clean white stone. The sales this quarter achieved an average value of $69 per carat, yielding proceeds of $13.5 million. Since commencement of production in Q4 CY2016, Firestone has sold all 505,706 carats recovered, for $41.3 million, at an average value of $82 per carat.