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Market Developments

Gemfields emerald auction in Zambia sets records


Editor's note: This story was updated shortly after publication to include a quote from Gemfields CEO Ian Harebottle.

Lusaka, Zambia--Colored gemstone miner Gemfields Plc announced Monday that its recent sale of rough emerald and beryl mined in Zambia totaled $31.5 million and set a new price-per-carat record while selling 100 percent by lot.

Gemfields held the auction of higher-quality rough in Lusaka from July 15 to 19. The London-based miner originally planned on holding the sale, the first of its 2014 fiscal year, in Singapore last month but postponed it to July in Zambia following protracted discussions with the government, which has said it wants future sales of gemstones to take place within the country.

All 583,448 carats of rough emerald and beryl, extracted from the Kagem Mine, sold. The auction’s $31.5 million total is the second highest in the history of Gemfields, despite the fact that it included the lowest number of carats offered at any of the company’s eight auctions of higher-quality rough.

Driven by favorable market conditions and strong demand from customers, the sale garnered the highest price-per-carat in Gemfields’ history at $54, topping the previous best of $42.71 set in July 2011. This included the sale of an “exceptional” 54-carat rough gem that set a new record per-carat price for a single stone. 

During the time it was negotiating with the Zambian government over the location of the auction, Gemfields CEO Ian Harebottle told National Jeweler that it was not in Zambia’s best interests to prevent the outside sale of gemstones because the country’s emeralds, which are a relatively new find, have the most ground to make up in terms of global brand positioning. The best way to do this is by making the gemstones as “accessible and competitive" as possible, he said.

When asked Monday if the success of the auction meant that future Gemfields sales would be held in Lusaka, Harebottle said, "We are delighted that this auction underscores Lusaka as a key hub in the international emerald trade and we would like to thank the Zambian Government for their support. Our focus must now be directed at keeping the current momentum going and on developing Zambian emeralds as the favored choice and this therefore drives the decision going forward."

Gemfields has held 13 auctions since July 2009, garnering a total of $207.3 million. The only auction to top this most recent sale was the July 2011 auction held in Singapore, which totaled $31.6 million.

Harebottle said in a company statement that they expect demand for colored gemstones, particularly emeralds, to continue to increase at a steady pace in the coming year. “Our investments and efforts in marketing Zambian emeralds worldwide are clearly working," he said.

Gemfields owns a 75 percent stake in the Kagem emerald mine in Zambia and a 50 percent interest in the company’s Kariba amethyst mine. The company also owns controlling stakes in a ruby deposit in Mozambique and licenses in Madagascar for ruby, emerald and sapphire deposits.

In addition, in January Gemfields announced that it had completed acquisition of FabergÉ, the Russian fine jewelry brand known for the bejeweled eggs it once created for Russian royalty.