Dominion Diamond’s sales drop following Ekati fire
According to a report released last month, Dominion Diamond Corporation’s annual sales fell a whopping 21 per cent last year. The mining company cites a fire at the Ekati mine and sluggish demand for smaller rough stones as the main culprits.
The Canadian company has stated that revenue slid to $570.9 million in the fiscal year that ended January 31. Rough sales increased 61 per cent by volume to 6.6 million carats, with the average selling price falling 51 per cent to $87 per carat.
Due to the blaze at Ekati in June, less goods were available for sale. This led to the processing plant shutting down for three months, causing revenue to slip 29 per cent in the third quarter and 27 per cent in the fourth quarter.
Moreover, demand for lower-quality rough was reduced by the Indian government’s decision to invalidate INR 500 and INR 1,000 currency notes in November. This depleted liquidity from small-to-medium diamond companies. Dominion expects the policy to add tension to the Indian retail jewellery market in the short term, but has projected that demand will return to normal in this sector by fall of 2017.