Shine comes off Gemfields as Zambia looks to ban auctions

City A.M. Reporter
PRECIOUS stones miner Gemfields yesterday said the Zambia government’s potential ban on overseas auctioning of gemstones could hurt revenue at its core emerald mine, sending its shares down as much as 27 per cent.

The Zambian Ministry of Mines, Energy and Water Development issued a directive on Friday that all auctioning of emeralds be held in Zambia as their sale in foreign markets contributes to capital flight.

“Gemfields has got around 20 per cent of the world’s [emerald] market, which comes from Zambia,” chief operating officer Dev Shetty said.

“Not allowing Gemfields to auction abroad is going to take us out of the competition with Brazil and Colombia, which holds 30 per cent each of the world’s supply of emeralds,” Shetty added.

The company, which named actress Mila Kunis as its brand ambassador earlier this year, mines mainly emeralds at its 75 per cent-owned Kagem mine, but also has interests in ruby and sapphire deposits.

Shares in the firm closed nearly 16 per cent lower at 25p.