Stornoway Diamond Corporation saw rough prices rise in the first quarter, driven by a resurgent market and the sale of its most expensive stone to date.
The miner achieved an average price of $112 per carat for the three months ending March 31, selling 399,135 carats for a total of $44.8 million (CAD 56.4 million). A 37-carat, type IIa, D-color, internally flawless rough stone garnered $1.3 million, or $36,000 per carat — the highest price for a diamond from its Renard mine in Quebec.
“The first quarter saw a strong performance for Stornoway in sales and pricing, with successively higher prices at each of our three sales, reflecting an improved size and quality mix and a strong start to the year for the diamond market,” CEO Matt Manson said. “The quarter also saw the sale of our highest-value stone to date.”
Although this year’s average price has increased from the $85 per carat earned in 2017, Stornoway has yet to reach its target of $125 to $165 per carat for 2018.
Stornoway’s production of 285,851 carats for the quarter was lower than it predicted, as the company processed lower-grade ore while going through its transition from open-pit to underground mining. It expects that shift to be complete by the end of the second quarter.
In 2017, the Canada-based company recorded a loss of $88.8 million (CAD 114.6 million), after being forced to devalue Renard, and consequently incurring an impairment charge of $132.6 million (CAD 171 million). The drop in the asset’s value was due to production of a lower-than-expected quality of stones.
At the end of the first quarter, Stornoway found a 189-carat stone — its largest to date — from Renard. Although the stone is relatively low in quality, it is one of the largest diamonds ever recovered in Canada.