It should come as no surprise that Rio Tinto has a very close relationship with pink diamonds, especially considering that Rio Tinto is the full owner of the Australian Argyle Mine. In this article, we’re providing all of the information you need on this topic!
A Brief History of the Australian Argyle Mine
The relationship started with Ewen Tyler, a geology student at the University of Western Australia. Tyler wanted to test a theory about where diamonds could form; in particular, whether they could form in the Kimberley, which had natural resources resembling those found in diamond mines around the world.
After sampling the resources, and receiving reports that showed there were diamond materials present in the resources, Tyler reached out to John Collier, the head of exploration for CRA Ltd, the company which later became Rio Tinto Ltd. From there, exploration continued, and what had started out as a small idea soon became a fully-fledged mine.
The mine officially opened in 1983 and has been producing pink diamonds ever since. Even though it has been ongoing for several decades, pink diamonds are still just as celebrated as they originally were, with Rio Tinto facilitating the Australian Pink Diamond Tender showcase, an invite-only event.
Rio Tinto and Investing In Pink Diamonds
So, how does this relate to Rio Tinto and investing? Quite simply, Rio Tinto owns the mine and, therefore, owns production of 90% of the world’s pink diamonds. Rio Tinto may, if they choose, close the mine and essentially stop all new supply of pink diamonds, as pink diamonds are very rare and the Argyle mine is their only stable producer. Spokespeople have said as much, saying that the Argyle mine will be closed for good in early 2019.
For pink diamond investors, this could be a good thing. Demand will grow, but there will not be any new supply being created to meet it. That means that the value of the pink diamond will increase, making it a stable and worthwhile investment. What may have cost $10,000 now may triple in worth after the mine is closed.
In other words, Rio Tinto created and now controls the market. As Rio Tinto is a reliable and longstanding business, one that is established in the diamond industry, this is good for investors. They can safely know that the value of their diamonds will only rise. As the market and profits are important to Rio Tinto just as much as it is to investors, there is a feeling of security: Rio Tinto would not be interested in acting in ways that would damage the pink diamond industry, considering the amount of profit they receive from it.
Argyle Diamond Investments understands the close relationship between Rio Tinto and the rare pink diamond. If you have any questions about this article or about pink diamonds, or if you would be interested in purchasing a pink diamond, feel free to contact us, either online or via 02 4927 0000.