The post Argyle Pink Diamond panorama

Following the closure of Rio Tinto’s Argyle Diamond Mine in November 2020 and the release of its final two tenders over the following year, the…

Following the closure of Rio Tinto’s Argyle Diamond Mine in November 2020 and the release of its final two tenders over the following year, the interest in, and the investment and prices of these pieces of mining history continued to climb while supply plummeted. One year on from Argyle’s closure, we surveyed the Australian pink diamond industry scene with the help of six pink diamond power-hitters.

1/9 Leibish

The ascension of Argyle Pink Diamond: prices

Anna Cisecki is Executive Director of full-service coloured diamond investment brokerage Australian Diamond Portfolio. She said that over the last two years, from the time just before Argyle closed, she’s seen prices increase by well over 50 percent, on average.

“Interestingly, while it was vivid pinks that saw the most explosive price growth in the financial year ending 30 June 2021, in the six months to end-December 2021, demand began to turn toward the lighter more affordable pinks, with prices responding to this, especially as availability on the market continues to decrease.”

Company Director of Mondial Pink Diamond Atelier Michael Neumann reported that since the last Argyle Tender, the prices asked by dealers and wholesalers have generally increased. These increases are greater than the historical yearly increases he’s seen over the past five years, he said, but they’re still reasonable given that there’s no way to replace the goods.

“I can say that the prices we paid for relatively commercial goods, 5-7P/PP, 0.08-0.14ct, Argyle-certified and laser inscribed, have increased from 40 percent to 80 percent in approximately the past two years.

“The prices for more premium goods have also increased significantly.”

Leibish is a New York-based internationally recognised specialist and online retailer of high-end diamonds and jewellery, with expertise in natural fancy-coloured diamonds and gemstones. Founder and President Leibish Polnauer said that since Argyle’s last tender, he witnessed a spike in pink diamond prices of some 30 percent.

“Personally, we offered 30-plus percent more on many pink stones without winning the bids.”

2/9 Mondial

The struggle to source an exhausted resource

The competition for the few Argyle Pink Diamonds which remain in the market is stiff, and despite adequate connections, stocks and know-how, our contributors have found it challenging to source the desired stones for their clients.

Dr. Adriana Traviati is Founder and Managing Director of Saphira Diamonds, a Melbourne-based company with an international presence which provides a unique and fully-personalised experience when buying diamonds, and creating custom-made pieces for their customers. An owner of Argyle Pink Diamonds herself, Adriana said for years customers have expressed interest in pink diamond jewellery and investment stones.

“I have found this demand to be increasing consistently over the last five years, and sourcing the stones is becoming ever-increasingly difficult.

“From those who wish to have a pink element in their jewellery, to those who wish to invest in Argyle-certified diamonds, there is a spectrum, and no sign of dwindling demand.”

She said that in light of Argyle’s closure and the increasing local and international demand, she chose to supply Saphira Diamonds with some pink diamond stock before entering a period dominated by the secondary resale market.

3/9 Saphira Diamonds

CEO of Q Report Jewellery Insurance Rami Baron said that prior to Argyle’s closure, his company saw a significant spike in demand and insured values of pink diamonds, especially Argyle tender stones. Currently, he’s seen a slowdown for significant pink diamonds of 40-points or more.

“We do see a lot of jewellery which uses small pinks as complementary or shoulder stones.”

Argyle coloured diamonds (pink, blue, yellow, champagne and cognac) have been the focus for Mondial for more than 30 years, so Michael said this means they possess a large and exceptional stockholding of Argyle Pink Diamonds.

“Hence, we sell mostly from stock and this enables our clients to get the benefit of our personal selection rather than just sourcing from whatever is available in the marketplace.”

He concedes that the stock is definitely dwindling, and it’s become a struggle to source something in particular that Mondial may not have in stock.

Anna said that Australian Diamond Portfolio is fortunate to have built a strong global supplier base over the many years they’ve been in the trade.

“Our suppliers also tend to be appreciative of the steps we take to promote the industry, with our signature focus on investor education.”

Anna also reported the difficulty in sourcing certain stones on the market.

Leibish said his company is selling stones from their current stock to Australia every week.

“But we cannot replace these stones once they’re sold. When they’re gone, that’s it.”

4/9 Australian Diamond Portfolios

Investors both doubling down and cashing out

Global economic conditions have fluctuated wildly since Argyle closed, with the pandemic, shortages, inflation and political instability all changing the fiscal landscape for investors. Many have responded accordingly, with some reinvesting in pink diamonds and a minority selling off to pay for other needs.

Michael said Mondial has many existing clients who have bought from them previously who return to purchase more stones.

“…because they trust us and know we will do our utmost to look after them and satisfy their desires.”

He said Mondial ensures they don’t sell on the basis of investment (which they’ve never pushed), but rather illustrating the fact that whatever the client buys now will likely cost less than if they wait to buy the same item years later.

“A pink is often something which they don’t need other people to recognise as rare and valuable but something which gives them a personal sense of satisfaction and pleasure.”

While Mondial has had customers over the years who have wanted to resell their pink diamonds, Michael said they haven’t had anyone recently looking to ‘cash in’.

5/9 Mondial

Over in the U.S., Leibish said that while there are a lot more buyers, there were still some resellers.

“We are always interested in buying stones we’ve sold previously.

“Unfortunately, most potential resellers have unrealistic goals since they purchased their stones second- or even third-hand at inflated prices.”

Whereas with clients looking to sell back stones originally bought from Leibish, he said they can usually find a way since they know the stone and its price.

Anna said Australian Diamond Portfolio has seen a surge of investment in the past two years, including from longstanding clients who’ve come back to build their pink diamond allocations.

“All up our figures suggest sales have increased by approximately 100 percent in the last two years.

“We aren’t seeing much turnover (i.e. people trying to trade stones), it’s more people buying them to hold as long-term assets in their portfolio.”

She said clients looking to ‘cash in’ represent only a small component of their total business.

“This is driven both by the fact that most clients see this as a strategic long-term investment, and the fact that so many new investors are looking to add pink diamonds to their portfolios.”

General Manager of Lost River Diamonds, Troy Reany, said he’s noticed more people looking to sell diamonds they bought many years ago.

“…which is great as it helps grow the secondary market.”

Adriana said that once the final Argyle Pink Diamond allocations are sold, and into the future, she will be relying on their customers to realise their investments and keep returning to Saphira Diamonds to help sell their Argyle diamonds. She said this will keep pinks coming back through the business to be sold once again.

“In this way, these stones will continue to trade internationally as a finite resource, and the world’s most concentrated form of wealth.”

6/9 Australian Diamond Portfolios

Argyle’s Iconic Legacy

Rio Tinto announced in June that it was launching its Icon Partner program, as part of its strategy to protect the provenance of Argyle Pink Diamonds. The company appointed Argyle Pink Diamond market developers John Calleija and John Glajz as its first Icon Partners, to use the remaining Argyle Pink Diamond inventory to develop jewellery and limited edition pieces. The program comes alongside the introduction of a certification service, a concierge trading platform for certified Argyle Pink Diamonds, a tender platform called Beyond Rare for special sale events and a number of strategic collections and collaborations involving their existing inventory and the secondary market. All of our contributors were encouraged by this news.

Anna said Australian Diamond Portfolio were highly encouraged by the news, as Rio Tinto’s decision to retain and continue to manage the Argyle brand rather than sell it off bodes incredibly well for pink diamond investors going forward.

“The fact that the Argyle brand creator will continue to nurture and sustain it highlights their faith in the opportunities this market continues to offer.”

Having worked with new Icon Partners Calleija and Glajz in the past, Leibish described them as excellent jewellers and fine people. However, he remained sceptical of the program itself given the lack of goods available.

“Without goods there isn’t much to manage.

7/9 Mondial

“The same theory applies to the concierge trading platform – there’s not much trade going on.”

He described the certification program as an expensive, but excellent move which would help get new certificates for old Argyle stones, thereby adding value to Argyle Pink Diamonds.

On a similar note, Michael congratulated the Iconic Partners, anticipated the results of their endeavours, but had reservations about the new services.

“Until I see more detail of these services and platforms and how they’ll actually work, I don’t really have an opinion.

“The initiatives are good ideas but at this stage, remain just that.”

Rami described it as an excellent strategic move on behalf of Argyle, as it would protect the value of investment stones and maintain the unique marketing position Argyle have spent years developing and investing in.

Troy said Lost River Diamonds were always in favour of endeavours that support the profile of Argyle Pink Diamonds.

8/9 Leibish

Our post-Argyle coloured diamond future

All our contributors remained optimistic as to what the future might hold, not just for current pink diamond investment and trade, but for new coloured diamond mines.

Rami believes Burgundy Diamonds, which acquired the Ellendale mines, is the new entity in the market that will lead the charge.

“The timing couldn’t be better as we are seeing a resurgence in the demand for yellow diamonds, which is the material Ellendale is famous for.”

Leibish acknowledged that while two mining companies (Burgundy Diamonds and India Bore Diamond Holdings) report having restarted some diamond production at Ellendale, there’s a lot of talk, but it’s far from being large-scale diamond mining.

“Burgundy Diamond Mines have restarted production of fancy yellow diamonds at Ellendale in 2022 and then cut and polish them at a purpose-built facility it acquired in Perth this year. “The government would greatly support such an operation.”

“Bright” and “sparkling” are the words Michael used to describe Australia’s future natural coloured diamond industry.

“Never before have so many jewellers and local diamond suppliers been so focused on coloured diamonds and their provenance and certification.”

9/9 Saphira Diamonds

However, he said that apart from the Ellendale prospective mine site, any other site appears a long way from commercialisation. But there will always be prospects for more Australian diamonds, and if they’re not too far from Argyle there will be fancy colours – he’s just not expecting anything new to come into the market anytime soon.

“Happy to be proved wrong on this, as I’ll be keen to buy.”

Focusing on future pink diamond trade, Anna said that while the supply of Argyle Pink Diamonds as truly rare and highly sought-after assets will be constrained going forward, demand will only continue to grow.

“…giving birth to what is a robust secondary market in pink diamond trading.”

As an exploratory geologist, the diamond exploration space over the next five years is something that excites Adriana, as she believes it’s full of potential.

“While the closure of the Argyle mine signifies the end of an era in terms of the world’s production of the finest pink diamonds, the ancient geologic Australian landscape provides ample and exciting opportunity to explore for new resources.

“While the Argyle mine is geologically unique, the Australian crust is diamondiferous and explorers may turn their attention to other provinces and prospective areas, such as the Northern Territory, for example.”

She said there are exciting developments happening within the exploration space which can be monitored via the ASX.

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