What Happens when the Argyle Diamond Mine Shuts Down?
Are diamonds forever? With the impending closure of the Argyle Diamond Mine, new supplies of these coveted pink diamonds will cease to exist. Since 1983, the famed Argyle mine in remote Western Australia has been supplying coveted pink and red diamonds to both ends of the market. As the world's largest source of rare and prized fancy pink gems, the mine is reaching the end of its lifespan.
Despite occupying such an influential position in the diamond industry and the investment market, all mines eventually "burn out." Unfortunately, the Argyle mine is no exception to this exhaustion. Within the very near future, as early as 2020, the Argyle Diamond Mine could cease production, and Rio Tinto has supported this hypothesis since 2013. What does the Argyle Diamond Mine closing mean for the diamond industry? We'll explore in more detail the importance of the mine and the impact its closing will have on the value of these diamonds.
What is the importance of the Argyle Mine?
The Argyle Diamond Mine has supplied roughly 90% of the world's most valuable pink diamonds. These fancy-coloured stones command some of the diamond sector's highest prices. A 50.6 carat pink diamond “pink legacy” has set the record for the largest auction price for any gem - 71 million dollars, in 2017.
How will the closing of the Argyle Mine impact the coloured diamond industry?
The Argyle Mine is located 2,600 kilometers northeast of Perth, Western Australia. The mine is scheduled to shut down production toward the end of 2020. Experts believe the mine will finally exhaust its supply of diamonds that are economically viable for the market at this time.
By volume, the Argyle Mine is the most substantial diamond producer in the world, and the largest supplier of the ultra rare fancy pink diamond. However, the most significant contributor to Argyle's mining output is champagne diamonds that command a lower price compared to the coveted pink diamonds.
Consumer demand for diamonds is stable, but with the Argyle Diamond Mine expected to close, there is speculation that diamond prices will increase once such a considerable supply of the world’s diamonds don't reach the market anymore. Fourteen million carats worth of diamonds from the Argyle Mine will not enter global diamond supplies once the mine closes at the end of next year.
The pink stones in the current diamond market have already seen unprecedented demand with news of the mine's impending closure. As the looming date of closing nears, it is expected that prices for Argyle pink diamonds will continue to climb. At specific sizes and price points, these diamonds are already difficult to find and purchase. Diamond enthusiasts can expect these restrictions in the supply of particular diamond shapes to increase.
As one of the few Argyle select Atelier’s worldwide, Nina’s has a collection of some of the worlds most rare and exclusive pink diamonds for sale, alongside a range of affordable Argyle pink diamond jewellery.
What mines could take Argyle's place?
Currently, there is no evidence that a new mine will be found that could fill the substantial shoes of the Argyle Diamond Mine. Exploration for new diamonds is incredibly expensive and a process that can take years to complete. Even if a new source of fancy coloured diamonds is found, that doesn't mean that operations will be profitable enough to make the mine viable.
Also, the financial stability of the global market and fluctuations in the diamond industry could make mining impractical. Most of the major mining companies have drastically reduced their exploration efforts because of these issues. While many existing mines already produce fancy colour diamonds, none have so far been able to reproduce the same brilliance, colour, and beauty of the Argyle stones.
Could anything replace the Argyle Tender?
The Argyle Diamond Tender happens each year, and is a hand selected collection of 50 to 65 of the most rare and exclusive Argyle pink diamonds. When the mine closes, the Argyle Tender will be gone, which will significantly impact the diamond investment market.
2018's tender was the most successful in the company's entire history, with a 400% appreciation. The tender's success indicates that demand for investment diamonds is increasing. At this time, there is nothing on the horizon that could replace the Argyle Tender.
Our Argyle Diamond Mine Closing Predictions
Diamonds are no exception to the universal law of supply and demand. The Argyle Diamond Mine closing will not stop consumer's desire for pink and fancy-coloured diamonds. But what it will do is greatly diminish the supply of these gems. With the end of the Argyle mine, reduced supplies of these stones will mean their value and rarity is projected to increase.
Contact us to begin your Argyle pink diamond journey, with an Argyle Pink Diamond Select Atelier.