Gemfields subsidiary Kagem mining sold $18.6million worth of emeralds in a precious stone auction held in the world’s colored stone hotspot, Zambia. The precious stone sale absorbed 74% of the 35 lots offered representing 37% of the carats offered to raise just below $19million in proceeds. This accounts for a 72.2% compared with $10.8million raised in the 18-20 February debt sale held in Lusaka. The per carat sale also grew 8.2% to $4.75 despite the percentage of lots sold by weight inching lower to 37% from 59% in previous auction. This then rally’s the total proceeds of thirty three (33) emerald sales by Gemfields to $608million globally since 2009. The sale attracted over 34 corporates placing bids that averaged $4.75 per carat.
Gemfields’ Managing Director of Product & Sales, Adrian Banks commented:
“We are pleased that the green shoots of recovery in the emerald sector first observed at our May 2019 emerald auction in Singapore have continued to grow this week in Lusaka. The Indian market, which is particularly important when it comes to commercial quality emeralds and which has been navigating challenging conditions for some time, appears to have turned the corner and we hope will continue to go from strength to strength. This auction saw the highest number of participating companies at any of our commercial quality auctions held in Lusaka, and we congratulate Caibaocheng on becoming the first Chinese customer to win at any Gemfields emerald auction.
As usual, and given our long-term vision and loyalty to the true value of Zambian emeralds, we have elected to retain auction lots that we believe command higher prices than those presently offered by the market.
Banks bemoaned the (15%) export duty imposed on emeralds since 1 January 2019 as a key impediment to the company’s operations. This combined with the pre-existing (6%) mineral royalty tax, Zambian emerald exporters effectively pay (21%) turnover tax on their revenues. The financial impact is being acutely felt and severely inhibits liquidity for capital investment purposes to enable growth and handing the tactical advantage to other emerald- producing countries like Brazil and Colombia, neither of which have any export duty on emeralds.
“We continue to liaise with the key government departments in seeking resolution and remain hopeful that a solution will be found,” Banks said.
Gemfields is a world leading supplier of responsibly sourced coloured gemstones. Gemfields is the operator and 75% owner of both the Kagem emerald mine in Zambia (believed to be the world’s single largest producing emerald mine) and the Montepuez ruby mine in Mozambique (one of the most significant recently discovered ruby deposits in the world). In addition, Gemfields also holds controlling interests in various other gemstone mining and prospecting licenses in Zambia, Mozambique, Ethiopia and Madagascar.
This article has been written by the BT Research Team wit his reference to Stock Exchange News announcement for Gemfields Mining Plc tradimg on the Johannesburg Stock Exchange – JSE.
