Mountain Province resumes diamonds sales in Antwerp

[caption id="attachment_1003741982" align="alignnone" width="660"] At the Gahcho Kué diamond mine in the Northwest Territories. Credit: Mountain Province Diamonds[/caption] Mountain Province Diamonds held its first traditional diamond sale since the pandemic began on Sept. 19 in Antwerp. And while the sales figures are modest, the resumption of diamond sales is a major positive development for the diamond sector, which has been largely shut down by COVID-19 travel restrictions, lower demand and low prices. Mountain Province, which owns a 49% interest in the Gahcho Kué mine, in the Northwest Territories, sold 210,661 carats for a total of US$8.9 million or US$42 per carat. The sale did not include any high-value or fancy stones. "We are pleased to have finally resumed our traditional sales channels as the markets around the globe continue to gradually open for business,” said Mountain Province's president and CEO, Stuart Brown. “The results of the first small sale, post the COVID-19 pandemic are an encouraging start considering that the market has been at a standstill for nearly six months. The results of the sale were a positive sign as the markets for rough and polished diamonds start to return." The company reports that bidding was strong and consistent with sales activity earlier in the year, despite ongoing travel restrictions in Belgium. The sale prices were comparable (about 1% lower) to those achieved in the junior's last traditional sale, which was in February. In a research note, Ed Sterck, a mining analyst at BMO Capital Markets, wrote that: “Although volumes and revenues are relatively small, the recommencement of regular sales is a positive sign that the diamond market/pipeline has started to move following COVID-19 related restrictions. The company also highlighted that prices were down ~1% compared with achieved in February (on a like-for-like basis), which represents a significant improvement from our estimate of trough pricing being down 22-25% during the peak of the pandemic.” Mountain Province's next traditional sale is slated to close on Oct. 31. The junior has been able to generate some revenue through the pandemic by way of an alternative sales arrangement with Dunebridge Worldwide. The arrangement accounted for the majority of the company's second quarter revenues totalling US$25 million ($34 million) at an average realized price of US$45 per carat. The Gahcho Kué mine is operated by Mountain Province's joint-venture partner and 51%-owner De Beers. For more information, visit www.mountainprovince.com.