The diamond market has suffered in the last few years, says John Kaiser of Kaiser Research in the video interview above. The western world is losing interest in the gems, while in the east India’s surprise decision to become a cashless society has rocked the industry.
So what’s an investor to do? According to Kaiser, there’s still hope for those who want to invest in the diamond market. He notes that Lucara Diamond’s (TSX:LUC) Karowe mine has been a bright point in recent years. Its AK6 kimberlite pipe has produced Type IIa diamonds, and according to Kaiser, they are “very, very large … there’s the 1,100-carat diamond that they found a year and a half ago.”
Kaiser believes companies that are able to produce Type IIa diamonds may be poised to do well in the future. As he explains, that’s because “there is demand for these large diamonds because the rich are not going to disappear. The rich are going to get richer and they are going to be interested in these types of diamonds, these larger diamonds. That market’s not going to go away.”
He adds, “the natural, real, large, gem-quality diamonds — there’s going to be demand for that.”
One diamond company he’s optimistic about is Tsodilo Resources (TSXV:TSD). “Tsodilo got hold of the BK16 pipe, which is similar to the AK6 pipe,” he says, noting that the company has demonstrated that some of the diamonds in the pipe are Type IIa. Tsodilo is planning to complete a bulk sample, and if the results are favorable, it will be “an obvious company … for Lucara to buy out.”
Watch the video interview above to hear more of Kaiser’s thoughts on Type IIa diamonds and the diamond market as a whole. The transcript for the interview will be added shortly.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in contributed article. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
John Kaiser owns shares of Tsodilo Resources and Peregrine Diamonds (TSX:PGD).
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