Bengaluru   — Petra Diamonds’ first-half revenue fell 6%, dented by lower prices as the diamond industry grappled with soft demand from China and Hong Kong, but the African miner said it would meet or exceed its annual production target.

The industry has been facing slowing demand due to anti-government protests in Hong Kong and the bruising trade dispute between China and the US, while some analysts blame it on laboratory-grown diamonds and an oversupply of smaller rough diamond stones.

There has, however, been an improvement in demand in the second quarter, with rough diamond pricing seeing a modest rise, the miner said, adding it is on track to meet or exceed its full-year production outlook of about 3.8-million carats. 

Revenue for the six months ended December 31, came in at $193.9m compared with $207.1m in 2019, while production inched up 3% during the first half, the African diamond miner said.

Petra said lower prices and poor quality diamonds from the Finsch mine in SA offset the sale of the exceptional blue diamond from its flagship Cullinan mine.

The Cullinan mine, which was acquired by Petra in 2008, is the world’s main source of rare blue diamonds, accounted for around a third of the company’s diamond sales revenue in 2018.

The company sold a 20.08 carat blue diamond recovered from Cullinan in September for $14.9m.

Petra, which operates four mines — three in SA and one in Tanzania — said it produced about 2.1-million carats of diamonds, compared with 2-million carats  in 2019.

The diamond miner has invested heavily in the Cullinan mine in SA  as it bets on big finds in an industry assailed by synthetic rivals and uncertain demand despite being saddled by debt.

Petra’s net debt stood at $596.4m, at the end of December, from $592.8m  as of September-end.

The shares fell more than 8% to close at 9.37p on the London Stock Exchange on Monday.