The world of diamonds without the Argyle mine after 2020

The Argyle mine have been the world’s most consistent and primary source of pink diamonds. It is through this mine the owner, Rio Tinto, has produced 90% of all the pink and purplish-pink diamonds circulating internationally. The market sought after the gems coming from Argyle and is rewarded by the best quality pink diamonds ever extracted from deep within the earth.

However, the Argyle ceased production in November 2020, and this will have an impact on the global diamond industry. There are a lot of factors that will be affected by the closure of these mines, and it will change the natural coloured diamonds landscape for the foreseeable future. Though other mines might be discovered in a few years, time will tell if any of these will yield enough unique and fancy coloured diamonds to be considered as productive as the Argyle.

A brief history of the Argyle mine

The Argyle mine located on the traditional land of the Miriuwung, Gidja, Malgnin and Wularr people in north-western Australia, lies 540 km south-west of Darwin and 120 km from the town of Kununurra. The mine is located on the AK1 pipe near Smoke Creek and Limestone Creek. To get to the mine, you need to book a flight to Kununurra, and hop on a chartered plane or tourist bus to the mine’s vicinity. 

Diamonds were first discovered in this region in 1895 when prospectors combed the area for possible gold deposits. Thousands of carats of diamonds were found afterwards, as people flocked to the area looking to make their fortunes in the Australian outback. 

During the 1960s, modern geological searching procedures and scientific knowledge of existing diamond extraction points were used to narrow down potential sources. It would be late 1969 before systematic exploration of the Kimberley craton would commence. The efforts were rewarded in 1979 with the surprising discovery of a diamond rich lamproite pipe, named the AK1 or, as we know it, the Argyle pipe mine, leading to most economically viable source of the world’s supply of pink diamonds.

Shortly after its discovery, Rio Tinto produced 6.2 million carats of diamonds in 1983 and the mine has continued to generate a constant supply of diamonds to the market. With high productions of near colourless, light yellow, brown, and the occasional pink, purplish pink, red, blue or green diamonds Rio Tinto developed new machines for sorting diamonds into different colour and clarity grades launching a highly revitalized diamond industry. Yet only 0.001% of all diamonds extracted from the mine have been pink diamonds. However, 90% of all pink and purplish pink diamonds circulating in the world today came from the Argyle in Western Australia.

Effect of the Argyle mine in the market

Effect of the Argyle mine in the market

The effect of the Argyle mine in the diamond industry is immense. The glamour of coloured diamonds, especially the pink one, results from the quality and intensity of the colour found in the diamonds this mine produces. The pink and purplish pink diamonds mined in the Argyle are the best in the world. Good quality pink diamonds are occasionally found in other places, but the diamonds from the Argyle are considered the most unique. The Argyle mine can be attributed to coloured diamonds making a grand entrance into the diamond and jewellery industry due to the output volume and reliability of the mine.

The steady yield of coloured diamonds from the mine increased the value of these stones as demand increased. Historically, traditional colourless diamonds were the talk of the town. As cutting methods improved, the transformation of light into a sparkle and flash of rainbow colours embodied a colourless diamond’s value. However, as more and more coloured diamonds entered the market, people gradually began to appreciate the beauty and significance of pink, yellow, and champagne diamonds, obtaining one of these became a trend.

The Argyle mine marketing strategy

Aside from the superb diamond quality produced by the mine, Argyle managed to gain fame through effective marketing of what was, at that point, freakishly not a colourless diamond. Rio Tinto, with its international connections and store locations, have been successful in branding the Argyle as ‘the’ place to find quality pink diamonds. 

Although pink diamonds are found in other localities occasionally, Rio Tinto has gained a foothold in the market as the Argyle backs its grading standards by certifying only the highest quality coloured diamonds it has unearthed. As a result, the price of Australian pink diamonds has increased immensely over the past two decades. From 2000, the price of pink diamonds has increased by 500%, and will undoubtedly raise more in the period after the mine’s closure. 

Closure of the Argyle mine

The closure of the Argyle mines will undoubtedly affect the entire diamond market worldwide. Rio Tinto officially closed its Argyle operations on 3 November 2020. The reason for the closure is not due to the mine drying up. There are diamonds still in the Argyle mines; however, the extraction process has now become prohibitively expensive. There is more value to the Australian community in rehabilitating the land, returning it to the Traditional Owners to support agricultural and tourism purposes.

The closure of the Argyle mines is expected to shake the diamond market to its foundation as the closure of the primary source of pink diamonds will affect the demand and price of these gemstones. Alongside this closure is the effective end of Australia’s place in the coloured diamond market. While the exploration of future Australian diamond rich sites has yielded no economically viable sources of coloured diamonds, the Argyle will likely hold the title as the most prolific producer of high quality pink diamonds for many years.

Sources:

https://www.ibisworld.com/industry-insider/press-releases/the-argyle-mine-s-closure-is-set-to-disrupt-the-global-diamond-market/

http://web.archive.org/web/20210131063028/https://www.ibisworld.com/industry-insider/press-releases/the-argyle-mine-s-closure-is-set-to-disrupt-the-global-diamond-market/

https://www.riotinto.com/en/operations/australia/argyle accessed: 9/04/2021 dh

https://www.gia.edu/doc/Discovery-and-Mining-of-the-Argyle-Diamond-Deposit-Australia.pdf accessed: 09/04/2021 dh

https://www.capetowndiamondmuseum.org/blog/2019/06/8-amazing-facts-about-natural-pink-diamonds/ accessed: 09/04/2021

https://www.mining-technology.com/projects/argyle/

Argyle Diamond Investments Pty Ltd are Australia’s largest supplier of Australian certified pink diamonds and have exclusive use of the Australian Pink Diamond Analytics program. This program is a data driven decision maker that tracks and statistically analyses the rarity, financial growth and value of all investment grade pink and blue diamonds. With this valuable information, Argyle Diamond Investments Pty Ltd can offer all clients an investment grade pink from $5,000AUD up. But, the highest growth diamonds, are the larger, stronger colour pinks starting from around $20,000AUD plus.

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