By Michelle Graff
Gem Diamonds reported last week that it recently recovered this 233-carat Type II rough diamond from Letšeng, a mine known for producing large, high-quality diamonds. It operates Letšeng in a 70/30 partnership with the Lesotho government. (Photo courtesy of Gem Diamonds)
London—Sales and production dropped in the first half of 2020 for Gem Diamonds, as it was forced to shut down its Letšeng mine and prices for all diamonds—even large, top quality stones—slumped.

The London-based diamond miner reported Thursday that in its half-year ending June 30, total revenue fell 24 percent year-over-year to $69.5 million from $91.3 million.

The company reported a loss of $1.7 million, which includes the money it’s spending to keep the Ghaghoo project in Botswana on care and maintenance while it waits for its sale to be finalized, compared with a $4.2 million profit in the same period last year.

“Letšeng delivered satisfactory operational results notwithstanding the imposed shutdown of 30 days during the period to curb the spread of COVID-19,” said CEO Clifford Elphick.

“Despite the challenging global conditions, the sales results during the period demonstrated the continued demand for Letšeng’s high-quality diamonds … It is also pleasing to note the reopening of key sectors within the diamond industry, in particular the manufacturing sector, which should support positive demand in the short to medium term.”

Gem said it recovered seven diamonds greater than 100 carats in size during the first half of the year, up from three in the same period last year.

The largest diamond it’s found so far this year is the 442-carat Type II recovered in August.

The value of its diamonds in H1 was essentially flat year-over-year, selling for an average of $1,707 per carat compared with $1,697 per carat last year.

After a difficult year for the diamond market in 2019, the company said prices for high-quality stones were climbing in the first two months of the year, pointing toward a “modest recovery” in 2020.

But then the pandemic hit, shutting down diamond mining and manufacturing operations worldwide, dampening prices, and bringing retail, and consumers, to a standstill.

The most valuable diamond Gem sold during the period was a 13.6-carat pink that went for $40,117 per carat, or $545,591 total.

The miner also sold a 48.16-carat Type IIa rough diamond for $33,453 per carat, or about $1.6 million total.

(The record per-carat price for a diamond from Letšeng mine is over $600,000, held by a 13-carat pink diamond Gem recovered last year.)

Production was down 24 percent to 43.3 million, as the miner was forced to put Letšeng on care and maintenance from March 28 to April 26.

Normal production at both treatment plants didn’t ramp up until May 27, with normal waste mining not resuming until July.

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