Gem Diamonds said its sales declined sharply during the third quarter ended September 30 due to weakening rough prices and tightened liquidity.
Sales at its Letšeng mine in Lesotho eased 38 percent year on year to $34.4 million, while the average price of sales tumbled 31 percent to $1,673 per carat.
Sales at Letšeng had also declined 26 percent to $159.7 million during the first nine months of the year.
''The diamond mining industry continued to experience rough price headwinds during the period from the ongoing global financial turmoil and uncertainty,'' said Gem Diamonds chief executive Clifford Elphick.
''However from October 2012, rough prices have begun to show a more positive trend.''
Gem Diamonds said rough and polished market indexes were, however, beginning to reflect a more encouraging overall trend, but was quick to warn that the rough trade was expected to be calm in November as the Indian market celebrates Diwali.
It also expected U.S. retail sales during the Christmas season to provide some stimulus to prices in the short term.
Gem Diamonds said that the supply strategy of the major producers in an illiquid and fully supplied market, as well as the aftermath of Superstorm Sandy in the U.S. might have a negative impact.
Meanwhile, the miner said production at Letšeng also weakened 9 percent during the period under review to 27,054 carats.
Severe winter snow conditions were blamed on the weak output.
Mathew Nyaungwa, Editor in Chief of the African Bureau, Rough&Polished
