Renard Price Drop Leads to Stornoway Loss

RAPAPORT... Stornoway Diamond Corporation recorded a loss in 2017, as lower-than-expectedrough prices forced it to devalue its Renard mine. The miner reported a net loss of $88.8 million (CAD 114.6million), versus a profit of $15.2 million (CAD 19.6 million) in 2016,it said Monday. The loss was primarily driven by a $132.6 million (CAD 171million) "impairment charge" due to the Renard devaluation. The weak rough-diamond market had a negative effect onprices, Stornoway said in January. In addition, the mine produced lower-qualitystones than the company had expected. Also, stones were breaking up duringprocessing, reducing their value. The miner only managed to correct thebreakage problem later in the year. Stornoway achieved an average selling price of $85 per caratin 2017, well below its initial prediction of $100 to $132 per carat. Priceshave shown some improvement this year, with the January tender fetching $104per carat due to an increase in the quality of diamonds available.The miner expects an average price of $125 to $165 per carat for 2018.