Flagging Demand, China Downturn Hit Gemfields Emerald Auction  

Gemfields saw weak sales at the most recent auction of emeralds from its Kagem mine in Zambia amid a slowdown in luxury demand, primarily from China, and competition from another producer. 

The company achieved $10.8 million from the sale of 28 lots comprising 2.4 million carats between August 27 and September 13, representing only 61% of the total 46 lots offered, it said Monday. The total for the sale in Jaipur, India, is the lowest in two years. Revenue at the previous sale, which took place in March, came to $17.1 million, while the auction it held during August and September last year brought in $25.5 million. 

“The luxury goods, diamond and gemstone markets are experiencing distinct headwinds as conflicts, elections, economic uncertainty in China and broader economic turbulence take their toll,” said Adrian Banks, managing director of product and sales at Gemfields. “Today’s overall result is weaker than expected, exacerbated in part by a competing emerald producer scheduling their own auction to finish in early September, in the middle of ours, and selling through their emeralds at what customers reported as low prices.” 

The company made the decision to hold back lots from sale due to the downturn, it said. 

“Gemfields remains committed to acting responsibly by withholding auction lots when fair market prices are not achieved, as is demonstrated by the lots we withdrew from our auction, which comprised both considerable volume and value,” Banks added. “We hope that market conditions improve.” 

The company will host its next auction, consisting of higher-quality emeralds, in November.

Image: Rough emeralds. (Gemfields)