Sales and profits have plunged at Dominion Diamond, the world’s third-largest diamond producer, and the company has followed other producers and lowered prices in August.
Its average diamond price has fallen some 5 percent year to date, it said.
The company posted a 24 percent sales drop for the second quarter of 2016 (ended July 31), to $209.7 million. It also posted a $2.8 million loss before taxes for the quarter, compared to a $24.1 million profit the prior year.
The company blamed “weak” demand in the market, particularly from Asia, for the results. However, in a conference call following the release of the financial results, executive vice president Jim Pounds said that while demand all over the world has sunk, in the U.S. it remains “robust.”
Pounds added that credit has become less of an issue in the market.
“I have talked before about the capitalization of the middle of the pipeline over the last few years due to too much cheap, readily available credit and the need for the middle of that market to contract,” he said. “That’s exactly what we have been seeing, and in the long-term that is a positive.”