Gahcho Kué diamond sales fall on weaker demand

Mountain Province Diamonds (TSX: MPVD; US-OTC: MPVD) says lower prices and demand from India and China depressed sales by 15% last year from the Gahcho Kué mine in the Northwest Territories.

Revenue declined to US$243.7 million ($328.6 million) from 2.7 million carats sold at an average value of US$90 per carat compared with US$297.3 million from the same amount sold at an average value of US$112 per carat in 2022, the Toronto-based company said in a news release on Tuesday.

Sales suffered after India, the world’s largest gem cutter, imposed a two-month ban on diamond imports ending in December while China’s sluggish economy slowed buying by polishers and jewelry store restocking, Mountain Province said in reports this week and in November.

The mine, about 280 km northeast of Yellowknife, produced 5.6 million carats last year. It was the low end of a forecast for as much as 6.1 million carats after a mid-year processing halt. The stoppage lowered processing to 73% of capacity in the year’s first half and 84% in the second. Gahcho Kué nearly tripled ore processing during the fourth quarter compared to the year-ago period, making it the year’s strongest three months. 

“We expect to carry this momentum into 2024 notwithstanding some expected seasonal reduction in performance numbers in the early months due to cold weather,” president and CEO Mark Wall said in the release. “The market is now reopened and we continue to monitor it closely to maximise value from our sales pipeline."