Gemfields bags R650m from May gemstone auctions

The Universe ring from Gemfields. SUPPLIED.

The Universe ring from Gemfields. SUPPLIED.

Published Jun 3, 2024


Emerald and ruby miner Gemfields bagged $35 million (R657m), at an average price of $167.51 per carat, from a gemstone auction conducted over the period May 13 to 30.

About 46 lots were offered for sale, with 43 of these sold during its latest auction period.

The company has generated as much as $1 billion in revenue from about 48 auctions of Kagem gemstones it has held since July 2009.

“The rough emeralds sold were extracted by Kagem, which is 75% owned by Gemfields and 25% by the Industrial Development Corporation of Zambia,” the company said on Friday.

“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.”

Gemfields said the overall price per carat for the latest lots sold were in line with the record figure achieved in Kagem’s corresponding high quality auction in May 2023.

However, the May 2024 gross was “skewed by the fact that two of the unsold lots were among the lower qualities offered” at the auction.

“We are very pleased to report robust auction results despite slightly softer market conditions,” said Adrian Banks, managing director for product and sales at Gemfields.

“Result demonstrates that both demand and willingness to pay premium prices for fine-quality Zambian emeralds remain at healthy levels.”

Banks said Gemfields was now looking forward to its forthcoming mixed-quality ruby auction this month, as well as to the next commercial quality emerald auction in September.

For 2023, Gemfields reported an 86% fall in pre-tax profits after cancellation of a high-quality emerald auction in November.

The company, which also has a portfolio for rubies in Mozambique and sapphires in Madagascar, reported lower carats sold during the period, while there was a write-down from its investments in a platinum group metals (PGM) project.

Revenues for the period dropped 23% to $262m, tipping the company into a post tax loss of $2.8m for 2023, which sharply contrasted with the group’s $74.3 million profit for 2022.

However, executives at the company were bullish about gemstone prices and markets.

“The coloured gemstone market continues to go from strength to strength, with Gemfields perfectly positioned by operating two world-class and market-leading mines, with Kagem, the emerald mine in Zambia, and MRM, the ruby mine in Mozambique,” said Gemfields chairman Martin Tolcher.

On its outlook, Gemfields was “confident that the group’s excellent work will continue and drive positive growth” for all stakeholders.

“Working with a natural product, there will be variation in both the quality and quantity of the coloured gemstones that the group produces and the prices paid for the rough gemstones,” said Tolcher.