"To remove the significant risk Mustang need to conduct two auctions (October and March), complete JORCs for Rubies and Graphite to establish life of mine and then progress to full-scale mining operations. "
"However a portfolio manager familiar with gemstones, who declined to be named, said Mustang could face challenges auctioning its stones in a market dominated by a large and well-established competitor."
Read more: http://www.copyright link/business/...cted-to-sparkle-20170709-gx7itz#ixzz4mtdnyw5F
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I have done some research about the risk and found some interesting relationship between Gemfields and their big buyers.
Key word: Gemfields authorised auction partners
1. Gemfields authorised auction partners
List : (The big buyers)
Some of another Gemfields authorised auction partners are not on the list, like Sparkle Gems pty ltd..
"Sparkle Gems is a well-established manufacturer with profound expertise in emerald cutting and production facilities in India. Our company is a Gemfields authorised auction partner and bought US$10 million worth of items in the last auction of Gemfields"
List of Gemfields authorised auction partners page has been removed from their website recently and replaced to this ...
(Lucky I did screenshots.)
http://corporate.gemfields.co.uk/about-us/mine-and-market
2. Gemfields authorised auction partnership requires customers to sign up to our business terms and policies.
(I have no idea about this)
3. Gemfields and their authorised auction partners relationship seems quite solid and they have direct commercial relationship.
(They are supplier & buyer also buyer & supplier)
"where possible, we prefer to buy back cut & polished gemstones that were first sold to our suppliers by us via our rough auction platform. "
"we can go back to the Gemfields authorised auction partners and source cut and polished gemstones to fulfil the needs of the different brands and designers we work with. By doing so we can help with the traceability of our gemstones from them being mined, to being won at auction, cut & polished to them ending up in an exquisite piece of jewellery."
Gemfields To Increase Buyback Of Cut And Polished Stones
FINANCE AND TRADE
10/08/2015 08:14
The move was announced by Gemfields COO Dev Shetty who said that the decision was taken to support the manufacturing sector of the colored stones industry, which typically lacks access to bank funding and finds it difficult to participate in Gemfields' rough stones auctions.
The company intends to buy back polished colored stones worth $75 million over the next five years from the trade. “We do not mind paying a little extra to the companies as they are the ones who would come back to our auction to bid for rough,” said Shetty.
http://www.thediamondloupe.com/arti...elds-increase-buyback-cut-and-polished-stones
Can Gemfields control the market?
I dont know. I am not a Gem expert.
DYOR.
