Rio Tinto's largest-ever 'red' diamond up for sale

Posted at 05/17/2013 1:13 PM | Updated as of 05/17/2013 1:13 PM
Josephine Johnson, manager of Rio Tinto's Argyle Pink Diamonds, holds the Argyle 'Phoenix' red diamond, one of the world's rarest gems, during a private viewing at a Sydney hotel May 17, 2013. Photo by David Gray, Reuters

SYDNEY - Rio Tinto said Friday it was putting up for sale the biggest "red" diamond ever produced by its Australian mine amid an "explosion" in demand from Asia for the rare pink-hued stones.

The Argyle Phoenix, a 1.56 carat gem, is one of three red diamonds on offer at the annual Argyle Pink Diamonds Tender -- the first time in the 30-year history of the exclusive sale that it has included three red stones.

"This is the largest red that has ever come from the Argyle diamond mine," Argyle Pink Diamonds manager Josephine Johnson told AFP as she held the stone. "Never seen before, likely never seen again."

"The diamond world will be talking about this diamond for the next few months intensely. And there will be lots of discussion about the rarity of it, the value of it."

The 2013 pink diamond tender comprises 64 diamonds, including 58 pink stones, three blue ones and the three fancy reds.

Such jewels routinely fetch US$1-2 million a carat. As a basic rule of thumb, a pink diamond is worth about 50 times more than a white diamond.

After previews in Sydney, New York and Tokyo, there will be tender viewings in Hong Kong and Perth, to allow clients and experts to see the gems and make offers for individual stones.

"The tender every year has great interest -- when you think there's only 60 stones each year, that's about 12 grams of diamond weight -- we tour it around the world because each one is like selling a Picasso," Johnson said.

"Each one is unique. They will find different markets.

"With a red diamond the colour itself is extraordinary, but what really transcends the appeal of the colour is just the outrageous rarity of something like this."

The Argyle mine in Western Australia produces virtually the entire world's supply of pink diamonds, with the red seen as the pinnacle of the colour scale.

It is not known how the diamonds acquire their pink tinge but it is thought to come from a molecular structure distortion as the jewel forms in the earth's crust or makes its way to the surface.

Japan is the largest consumer of pink diamonds, with the lighter "Cherry Blossom" shades in strong demand, but Johnson said Argyle diamonds were growing in popularity in other markets.

"There's an explosion of interest in China and India. We're certainly seeing that in the rare diamond world," she said.

"I am quite surprised at how quickly they have moved from a desire for large, white clean goods to an appreciation for the value of rarity and fancy coloured diamonds."

With the Phoenix, she said: "It being red is very interesting because that's a highly symbolic colour in Asia."

But she said with few reference points and increasing interest in colored diamonds, particularly rare pinks and reds, it was impossible to know where the stone would end up.

"Our last diamond that came anywhere near close to this actually ended up in the US, so it's hard to say," she said.

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