Gemfields Announced Result of Emerald Auctions

Lusaka: Gemfields has announced the result of an auction of predominantly commercial quality rough emerald held in Lusaka, Zambia from 18-21 February 2020. The emeralds were extracted by Kagem Mining Ltd in Zambia (“Kagem”, which is 75% owned by Gemfields and 25% by the Industrial Development Corporation of Zambia). The proceeds of this auction will be fully repatriated to Kagem in Zambia, with all royalties due to the Government of the Republic of Zambia being paid on the full sales prices achieved at the auction.

Highlights – Emerald Auction:

• Auction revenues of USD 11.5 million
• Of the 25 lots offered, 19 were sold (76%)
• Average price of USD 4.01 per carat • 64% of the carats offered were sold
• The 35 auctions of Kagem gemstones held since July 2009 have generated USD 647 million in total revenues

The auction saw 29 companies placing bids, generating total revenues of USD 11.5 million with an overall average value of USD 4.01 per carat. The auction saw 64% of the offered carats being sold (or 76% of the number of lots offered).

The specific auction mix and the quality of the lots offered at each auction vary in characteristics such as size, colour and clarity on account of variations in mined production and market demand. Therefore the results of each auction are not always directly comparable.

Adrian Banks, Gemfields’ Managing Director of Product & Sales, commented, “The results of our first auction of 2020 are in line with prior auctions of commercial quality emeralds and demonstrate a stable underlying market. It was however evident that the fallout of COVID-19 – the corona virus – dampened what might otherwise have been a buoyant result. Firstly, the uncertainty surrounding Chinese consumer demand in the wake of COVID-19 has understandably created negative sentiment in the mid-stream market. Secondly, a handful of our key auction customers did not travel to Lusaka as a result of the increased risk associated with COVD-19 and thirdly, the Hong Kong market – important for both gemstones and jewellery – has had to endure multiple successive misfortunes”.