Kagem Emerald Auction Results
Mining
LUFWANYAMA, ZAMBIA – Gemfields, which operates the Kagem emerald mine in Lufwanyama, has announced the results of an emerald auction comprising a series of five sequential mini-auctions held between 15 March and 17 April 2021). The proceeds of this auction will be fully repatriated to Kagem in Zambia, with all royalties due to the Government of the Republic of Zambia being paid on the full sales prices achieved at the auction.

Operations at Kagem, which remained suspended for a year till March 2021as a result of the Covid-19 pandemic, are expected to ramp back up to full scale by the end of April 2021.

During the year-long suspension of all but critical operations, Kagem employees (excluding those on critical operations) were placed on leave with 80% of basic salaries, in line with the new Employment Code Act 2019 (Act No. 3 of 2019) throughout the suspension period, despite not working.

Kagem has been able to avoid redundancies and retain its workforce due to the financial support provided by the majority shareholder, Gemfields.

The auction contained a selection of grades that are typically offered at auctions of higher quality Kagem emeralds. Selected lots were made available for in-person and private viewings by customers in Tel Aviv, Dubai and Jaipur. Following the viewings, the auctions took place via an online auction platform specifically adapted for Gemfields and which permitted customers from multiple jurisdictions to participate in a sealed-bid process.

Highlights – March & April 2021 Emerald Auction

  • Total auction revenues of USD 31.4 million
  • Average price of USD 115.59 per carat
  • Of the 37 lots offered, 36 were sold (97%)
  • 99% of the carats offered at the auction were sold

Prices achieved during the series of mini-auctions held in November and December 2020 were robust but resulted in a slightly lower average price per carat. The March and April 2021 sales included the finer qualities of emerald that were not offered in the November and December 2020 sales and this has contributed to the increased price per carat achieved in the most recent auction series. Combining the results from the November-December 2020 sales with those from the March-April 2021 sales provides a more balanced view, with an average sales price of USD 93.21 per carat, an all-time high.

Adrian Banks, Gemfields’ Managing Director of Product & Sales, commented:

This was Kagem’s highest auction revenue since March 2016 and we were very pleased to see such strong demand and pricing. Because operations were suspended at Kagem in March 2020, the world’s largest emerald mine produced no new emeralds for more than a year. Due to the arising supply and demand dynamics, a number of our clients have therefore seen this auction as a vital opportunity to purchase emeralds. Today’s result also means that Kagem has already surpassed the aggregate auction revenues achieved in the whole of 2020, which stood at just USD 22.4 million as a result of the fall-out from the Covid-19 pandemic.

Gemfields is excited to be back in business after the lengthy pause in both mining and sales and – as always – we extend our sincere thanks to our hard-working teams, to our host government in Zambia, and to our customers for their ongoing support.

-Ends-


CONTACT

Enquiries
Gillian Langmead
Langmead & Baker Ltd
Tel: +260 979 060705
info@langmead.com

Head office
Helena Choudhury
Head of PR and Communications
Tel: +44 (0)207 518 3420
helena.choudhury@gemfields.com

Notes to editors

Kagem responsible sourcing highlights
  • Kagem is committed to ensuring that the community continues to benefit positively from its operations through various sustainability programmes focused on alleviating poverty and aligned with government policies, the UN Sustainable Development Goals (SDGs) and Vision 2030
  • The mine has spent more than USD 2.7 million on community projects, including:
    • Rehabilitation of the 18.7km road connecting Chief Nkana and Chief Lumpuma’s chiefdoms from Kandole to Kafwaya village in Lufwanyama district
    • Construction of the Nkana Health Centre
    • Construction and equipping of a new Chapula Secondary School
    • Construction of new buildings at Chapula Primary School
    • Building of teachers’ accommodation at Kapila Community School
    • Support for the Blessing, Kapila Green Farms,Twende and Twasanta projects including distribution of farming inputs to Chief Lumpuma
    • Improvements to Chief Nkana and Chief Lumpuma’s palaces
    • Support towards Covid-19 efforts including the donation of relief items to Nkana Health Centre and other health facilities in the Lufwanyama
  • Kagem’s USD 345,000 industry training initiative is sponsoring 12 students from the geological and mining engineering departments at the School of Mines at the University of Zambia (UNZA) and Copperbelt University (CBU) over a period of eight years.
  • Since acquiring 75 percent of Kagem in 2008, Gemfields has been meticulous in declaring revenue, which has reached approximately USD 688.8 million from the sale of emeralds at auctions both locally and internationally, and which are overseen by representatives from the Ministry of Mines and Zambia Revenue Authority (ZRA). Proceeds from the auctions are repatriated to Zambia, generating valuable foreign exchange for the nation.
  • Kagem has contributed approximately USD 132 million to the Zambian government in cumulative corporation taxes, mineral royalties, export duty and dividends. This means that around 19 percent of Kagem’s revenues have flowed to the Zambian government.
  • Kagem currently provides more than 1,100 direct jobs.

About Kagem Mining
Kagem Mining Ltd, based in Lufwanyama, is believed to be the world’s single largest producing emerald mine. Kagem is 75% owned by Gemfields, in a model partnership with the Zambian government.
Kagem aims to emulate the values of Gemfields and operate in a way that contributes positively to the national economy, while taking a leading role in modernising the coloured gemstone sector and building sustainable livelihoods for the communities around the mine. Kagem believes that coloured gemstones should be mined and marketed by championing three key values – transparency, legitimacy and integrity.
Gemfields is a world-leading supplier of responsibly sourced coloured gemstones. In addition to Kagem, Gemfields is the operator and 75% owner of Montepuez Ruby Mining in Mozambique (at one of the most significant recently discovered ruby deposits in the world), as well as bulk sampling licences in Ethiopia, amongst others.
Gemfields has developed a proprietary grading system and a pioneering auction and trading platform to provide a consistent supply of coloured gemstones to the global jewellery market.
Fabergé – an iconic name with an exceptional heritage – is a member of the Gemfields Group. This enables Gemfields to improve its positioning, perception and consumer awareness of responsibly sourced coloured gemstones through the beauty of design and craftsmanship.
Gemfields’ responsibly sourced gemstones are the preferred choice for show pieces created by many world-renowned luxury houses and cutting-edge designers.

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