Continued Market Weakness Hits Petra’s Rough Prices

Petra Diamonds’ rough prices fell at its latest tender amid ongoing softness in the market, made worse by seasonal weakness. 

The seventh trading session, which took place in June, realized $38 million from the sale of 337,064 carats, while like-for-like prices slipped 3.8% versus May, the miner reported Thursday. The sales value was down 14% from May’s $44 million, while sales volume decreased 9%. The average price declined 6% from the previous tender to $111 per carat. Last year, the miner canceled its June tender due to the sluggish market and instead offered the approximately 380,000 carats intended for that sale in August.  

Part of the drop in the average price was the result of a weaker product mix than at the previous tender, Petra noted. The 14% slide in the average price of rough from the company’s Williamson mine in Tanzania also proved detrimental. The miner attributed the fall to a “reduced prevalence of higher-value single stones.” That decline is due to the mining areas to which the company currently has access, which it expects will be temporary. 

“Like-for-like prices in this tender cycle were down…compared to tender six as a result of the continued softness in demand for coarser goods…exacerbated by seasonal weakness,” said Petra CEO Richard Duffy. 

Like-for-like prices of rough diamonds in all categories softened, but specifically in those between 1 and 10 carats, Petra observed. Average like-for-like prices for the first seven tenders of the fiscal year dropped 12% relative to the equivalent tenders the previous year. 

The miner also sold three rough stones through a partnership agreement, which realized additional profit of $1.3 million. That compared to $1.4 million in fiscal 2023. 

“We expect a subdued market through the end of the year,” Duffy added. 

Image: Rough diamonds. (Petra Diamonds)