Lucara CEO Lamb Urges Caution on Diamond Market, Talks Future of Lesedi La Rona

Mining and Exploration
30/11/2016 13:26

Lucara Diamond CEO William Lamb spoke with Rough-Polished (R-P) about their future plans for the 1,109-ct Lesedi La Rona, their exploration projects and expectations for the industry going forward. Lamb told R-P, "With the financial strength of the company, there is no rush to sell the [Lesedi La Rona]. At this time, we have sent the stone for advanced analysis to fully understand the potential yield for the stone. Once this is complete, which is expected to be done in Q1, 2017, we will assess the market and potentially put the stone on the market again. The company learnt many things during the auction process. There are a number of changes we would make to better demonstrate to the private collector what the intrinsic value of the stone is prior to going back to the auction platform."

On the rough diamond market, Lamb tells R-P, "The market remains strong, especially in the larger size fractions. We are confident that the company will exceed its revenue guidance target for 2016 [of between $200 million and $220 million] ... A lot of rough production has been sold during 2016. This rough being sold at prices higher than the trade recommended to enable them to maintain their margins. The company’s outlook for 2017 is extremely cautious, primarily because polished sales do not match the volume of rough sold, resulting in an increase in polished inventory." Asked about his projection of the diamond industry in 2017? "Cautious! The diamond market for 2017 will be determined by the sales and marketing efforts for polished goods through the holiday season, which in turn will either open liquidity early in 2017 or have a negative impact on rough diamond prices."