{"id":1175359,"date":"2020-04-01T07:58:35","date_gmt":"2020-04-01T13:58:35","guid":{"rendered":"https:\/\/www.mining.com\/?p=1018884"},"modified":"2020-04-01T07:58:35","modified_gmt":"2020-04-01T13:58:35","slug":"covid-19-robs-diamond-sector-of-recovery-hopes","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1175359","title":{"rendered":"Covid-19 robs diamond sector of recovery hopes"},"content":{"rendered":"<p>The&nbsp;rapidly-spreading&nbsp;coronavirus&nbsp;pandemic has quashed diamond miners\u2019 dawning hopes of a recovery in a sector severely hit by weak prices and demand since late 2018.<\/p>\n<div class='d-flex justify-content-center d-xs-block d-sm-block d-md-none'>\n<div id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {googletag.display('div-gpt-ad-1561499308230-0');});<\/script><\/div>\n<\/div>\n<p>The market began suffering from the effects of the covid-19 spread in early March and measures to contain it has already pushed De Beers, the world\u2019s largest producer by value,&nbsp;to <a href=\"https:\/\/www.mining.com\/de-beers-scraps-diamond-sales-event-due-to-coronavirus-lockdowns\/\"  rel=\"noreferrer noopener\" aria-label=\"cancel its April sales event (opens in a new tab)\">cancel its April sales event<\/a>.<\/p>\n<p>Russia\u2019s Alrosa, the world\u2019s No.1 producer of rough diamonds by carats, said earlier this month that it was studying options for online trade as global travel restrictions make traditional physical inspection of gemstones almost impossible.<\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p>Mines in South Africa, Canada and Lesotho have been put on care and maintenance for at least a few weeks to stop the spread of the virus.<\/p>\n<\/blockquote>\n<\/figure>\n<p>Smaller producers, however, have<br \/>\nbeen forced to make more extreme decisions, suspending guidance for the year<br \/>\nand halting operations. Mines in South Africa, Canada and Lesotho have been put<br \/>\non care and maintenance for at least a few weeks to stop the spread of the<br \/>\nvirus.<\/p>\n<p>According to VTB Capital\u2019s estimates,<br \/>\nincreasing<br \/>\nmining disruptions put at risk 2.5% of rough diamonds supply expected for the<br \/>\nyear.<\/p>\n<p>Canada\u2019s&nbsp;Lucara Diamond&nbsp;(TSX:LUC) <a href=\"https:\/\/mma.prnewswire.com\/media\/1139997\/20200331_LUC_PR_COVID19_1.pdf\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">said on Wednesday<\/a> it continued to operate, but noted the extent of how covid-19 might change the business landscape was impossible to judge.<\/p>\n<p>The Vancouver-based company also<br \/>\nsuspended production and sales outlook for the year. It had guided recoveries<br \/>\nof between 370,000 to 420,000 carats for 2020. Sales had been estimated at<br \/>\nbetween 350,000 to 390,000 carats, generating&nbsp;$180 to $210 million in<br \/>\nrevenue.<\/p>\n<p>\u201cThe global diamond industry is<br \/>\nexperiencing the widespread impacts of COVID-19 throughout the value chain,<br \/>\nmanifested as fewer sales, weaker pricing and production curtailments at<br \/>\nseveral mines,\u201d chief executive, Eira Thomas, said in the statement.<\/p>\n<p>\u201cThough the Karowe diamond mine continues to operate according to plan, and the first quarter 2020 sale achieved results within expectations, the full impact of COVID-19 on our business remains uncertain,\u201d Thomas said.<\/p>\n<figure class=\"wp-block-pullquote alignleft\">\n<blockquote>\n<p>Production cuts are not enough to help the market swing to undersupply.<\/p>\n<\/blockquote>\n<\/figure>\n<p>Petra Diamonds (LON:PDL)&nbsp;also had to <a href=\"https:\/\/www.mining.com\/petra-diamonds-halts-2020-production-guidance-on-covid-19\/\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">halt its production outlook for fiscal 2020<\/a>&nbsp;after closing its mines in South Africa for a&nbsp;mandatory 21-day lockdown&nbsp;aimed at tackling the worsening coronavirus pandemic.<\/p>\n<p>Ruby and emerald miner&nbsp;Gemfields&nbsp;(LON: GEM), which returned to the London Stock Exchange in February, has <a href=\"https:\/\/www.mining.com\/gemfields-swings-to-profit-in-2019-but-future-uncertain\/\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">suspended &#8220;all but critical operations&#8221;<\/a> at&nbsp;its Kagem mine in Zambia and cancelled an&nbsp;upcoming auction.&nbsp;<\/p>\n<p>Rough diamond supply disruptions<br \/>\nare mounting and might be amplified by precious metals and gems repository<br \/>\nGokhran expected acquisition of between $0.5 and $1 billion Alrosa\u2019s rough<br \/>\ndiamonds this year, says Dmitry Glushakov, VTB Capital\u2019s head of metals &amp;<br \/>\nmining research. <\/p>\n<p>The cuts, however, are not enough<br \/>\nto help the market swing to undersupply, according to Liberum analyst Ben<br \/>\nDavis. He says announced output cuts would reduce supply by around 12% and<br \/>\nthat, even if prices go up&nbsp;as a result, small miners remain in dire<br \/>\nstraits.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The rapidly-spreading coronavirus pandemic has quashed diamond miners&rsquo; dawning hopes of a recovery in the beleaguered sector.<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[2849,949,369,4],"tags":[],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1175359"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1175359"}],"version-history":[{"count":12,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1175359\/revisions"}],"predecessor-version":[{"id":1175425,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1175359\/revisions\/1175425"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1175359"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1175359"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1175359"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}