Petra Diamonds, a London-listed gemstone miner, has announced a decrease in diamond sales for the second tender cycle of fiscal 2024. As a result, the company is revising its pricing assumptions for the fiscal year due to current market dynamics.
Unlike diamonds sold through direct negotiations or other methods, Petra Diamonds utilizes an auction process called a tender cycle to sell rough and polished diamonds. Each fiscal year, the company conducts seven tender cycles.
In the recent tender cycle, Petra sold 444,029 carats for a total of $40.5 million, compared to the previous year’s tender cycle which saw 445,113 carats sold for $59.9 million.
This decline brings the year-to-date revenue from rough diamond sales to $119.8 million, down from $161.3 million for the first two tenders of fiscal 2023 (excluding the Koffiefontein diamond mining operations in South Africa).
Furthermore, pricing assumptions for the Cullinan mine have been adjusted from $125 to $140 per carat to a new range of $110 to $130 per carat.
Petra Diamonds acknowledges that diamond prices are likely to remain volatile throughout 2023 and even into 2024. However, the company maintains its optimism, expecting prices to rebound in the medium to longer term due to a structural supply deficit.
As a result of this news, shares of Petra Diamonds were down 2% at 53.10 pence as of 0817 GMT.