Lesotho Diamond Mine Awaits Royalty Answer
LESOTHO · DIAMONDS
Key Facts
- The country A mountain kingdom inside South Africa; its Letšeng mine is known for very large, high-priced diamonds.
- Why now Owner Gem Diamonds updates investors on Wednesday 4 November 2026; the royalty holiday ran to 30 September.
- What happened In the first half of 2026 the mine’s revenue rose 32% to US$59.7 million, at US$1,395 a carat.
- What it means for you Investors in London-listed Gem Diamonds get a quarterly read; jewellery buyers see where top-end rough prices stand.
- Still open Whether Lesotho extends the royalty holiday, and whether lenders renew US$75.8 million of credit due in December.
In Plain English
Gem Diamonds is the London-listed company that owns 70% of the Letšeng mine. A trading update is a short note on production and sales issued between full financial results.
A royalty is a share of sales paid to the state, and the standard rate for Letšeng is 10%. EBITDA means operating earnings before interest, tax, depreciation and amortisation.
Lesotho’s Letšeng diamond mine is due to report its July to September results on Wednesday 4 November 2026, the first update since a royalty holiday from the Lesotho government ran to 30 September. The owner, London-listed Gem Diamonds, announced the date on 27 October 2026 for the three months from 1 July to 30 September 2026.
At the standard 10% rate, the US$59.4 million of rough diamond sales in the first half of 2026 would have carried about US$5.9 million of royalty, so the decision on what follows September matters to both the mine and the Lesotho treasury. The company says talks with the government on further relief are continuing.
For US readers the link is the price of large, top-quality natural diamonds, which the mine sells at tenders in Antwerp, Belgium, and which the company says are in strong demand. It is also a reading on a London-listed stock, ticker GEMD.
Who Owns the Mine and What It Pays
Gem Diamonds owns 70% of Letšeng, and the Government of the Kingdom of Lesotho owns the remaining 30%. The company describes the mine as the highest dollar-per-carat kimberlite diamond mine in the world, known for large, top-colour white stones.
In 2025 Letšeng paid US$25.4 million (453.8 million Lesotho maloti at the company’s 2025 average rate) in taxes, royalties and mining lease payments to Lesotho, according to the company’s annual report. It also provides jobs for about 1,000 people.
What the First-Half Results Show
Revenue rose 32% to US$59.7 million in the six months to 30 June 2026, from US$45.4 million a year earlier, as the average price climbed to US$1,395 per carat from US$1,008. Underlying operating earnings (EBITDA) turned positive at US$8.6 million, against negative US$2.6 million in the first half of 2025.
Eight diamonds each sold for more than US$1.0 million, bringing in US$16.1 million, and the highest price was US$32,908 per carat for a 52.24 carat white stone. Attributable profit was US$0.6 million, against a loss of US$11.7 million a year earlier.
A 346.99 carat white diamond recovered on Sunday 21 June was named the Lesotho Jubilee to mark the 60th anniversary of independence on 4 October 2026, and the company said it would be sold after the half-year period. The company’s published announcements show no sale of the stone as of 30 October.
Why the Royalty Holiday Matters
Lesotho suspended Letšeng’s royalties at the end of August 2025 for six months and later extended the suspension to the end of September 2026. Royalties and selling costs fell 86% to US$0.7 million in the first half of 2026, from US$5.2 million a year earlier, mostly because of the relief.
For its asset valuation the company assumed a 0% rate through 2026 and the standard 10% from 2027, but its half-year report says talks on relief after September are ongoing. Any change in the rate moves cash between the mine and the treasury.
Credit Lines, Mine Plan and the Market
Credit lines worth US$75.8 million in total, US$45.8 million at Letšeng (450.0 million maloti and 300.0 million South African rand) and US$30.0 million at Gem Diamonds, expire in December 2026. The company says it intends to refinance them, that talks with lenders are under way, and that its ability to continue as a going concern depends on the outcome.
Production for the rest of 2026 comes only from the lower-grade Main Pipe while the company prepares the next cutback in the richer Satellite Pipe. A year earlier the third quarter produced 22,268 carats and sold 22,830 carats for US$25.7 million, at US$1,124 per carat.
The company says synthetic diamonds have hurt prices for smaller, lower-quality stones and that several mines with that profile have suspended operations. It describes Letšeng as less affected, with strong demand lifting prices in the first half of 2026.
What It Means for You
US investors can read the update when the company releases it on 4 November under the ticker GEMD in London, and compare it with the third quarter of 2025 above. The company’s 2025 annual report names US tariffs and a weaker US dollar among the pressures on the diamond market that year.
For shoppers, the company’s account points to a market splitting in two, with steady demand for large natural stones and pressure from synthetic diamonds on small ones. Lesotho’s separate US trade link, duty-free clothing access under the African Growth and Opportunity Act, is covered in the guide to doing business in Lesotho and across Southern Africa coverage.
What Is Not Known
The company’s half-year report says talks with the government on royalty relief after September are ongoing, and the rate that applies from 1 October 2026 will first become clear if the 4 November update addresses it. Whether the Lesotho Jubilee sold, and at what price, is not announced.
The third-quarter carats recovered and sold will first appear on 4 November. The talks with lenders on the December credit lines had not concluded in the company’s last report.
Frequently Asked Questions
When does the Letšeng diamond mine report its next results?
Gem Diamonds will release its Q3 2026 trading update on Wednesday 4 November 2026, covering 1 July to 30 September 2026. The company announced the date on 27 October 2026.
Who owns the Letšeng diamond mine in Lesotho?
Gem Diamonds, listed in London, owns 70% of Letšeng, and the Government of the Kingdom of Lesotho owns 30%. The mine provides jobs for about 1,000 people.
Does Lesotho charge a royalty on its diamonds?
Yes, the standard royalty on Letšeng’s rough diamond sales is 10%, according to the company’s annual report. The government suspended it from the end of August 2025 and extended the suspension to the end of September 2026.
Does Lesotho’s diamond mine sell to the United States?
The company’s tender calendar lists Antwerp, Belgium, as the venue for its rough diamond sales. Its filings do not give a share of sales for the United States.
Sources: Gem Diamonds, Notification of Q3 2026 Trading Update, 27 October 2026; Gem Diamonds, Half Year Report 2026, 3 September 2026; Gem Diamonds, H1 2026 Trading Update, 28 July 2026; Gem Diamonds, Annual Report and Accounts 2025, April 2026; Gem Diamonds, Q3 2025 Trading Update, 30 October 2025; Gem Diamonds, press release list and tender calendar, read 30 October 2026.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief