Is the end of Natural Pink Diamonds Near?
October 14th, 2012 by Noam Flint
Probably the most known color among colored diamonds is the pink.
Natural pink diamonds are extremely rare and hard to find and the Argyle diamond mine, one of the most famous mines, is responsible for 90% of the world’s most exclusive pink diamonds.
The pinks coming from Argyle are known for their unique and strong color saturation and have always been more sought after and expensive than other pinks.
Is the end of Natural Pink Diamonds near?
Pink Diamonds are often taking the headlines of industry news.
During 2011 & 2012 it was because they broke price records one auction after the other with rare gems like the Martian Pink and the Majestic Pink but this time it is because of Rio Tinto’s pink diamond exhibition taking place in London ,showcasing $60 Million dollars’ worth of rare pink diamonds.
What invoked the discussion about the mine was an interview with the British jewelry historian Vivienne Becker who stated to AAP in London that the Argyle mine has a life expectancy of about ten more years:
“The products of this mine have changed the course of modern jewelry design and the chances of finding such another stream are slim to impossible… We have always known it was a limited source and that a time would come when this fabulous fluke of nature would end, but there is a lack of appreciation for what this will mean… In another decade the Argyle Pink Diamond will emerge as the new Faberge egg, the thing jewelry myths are made of.”
This interesting interview comes only a month after another known industry figure, Ms. Josephine Johnson, Argyle Pink Diamonds Business manager, was quoted at CBS news stating that they already cannot fulfill current demands:
“We don’t have enough diamonds to supply to the market. We have so few diamonds to sell globally that we cannot satisfy the demand. People ask for a two carat fancy vivid purplish pink and we simply have to wait for mother nature to supply that.”
Are Pink Diamonds the next Investment Opportunity?
When looking to buy diamonds for investment purposes, or any other merchandise and it doesn’t matter if it is real estate, stocks or gold, we expect (and hope) to sell it (some day) with a profit.
Basically, the way to do so is either finding an opportunity to buy below market price, below fair value, or to buy something that is expected for some reason to rise in value. For example – a product that is very sought after and cannot be bought, a product that the supply doesn’t meet the demand – a basic rule of economics. Sounds familiar?
Since we find it hard to believe that beautiful pink diamonds will stop being desired and the fact that the supply curve is expected to decline even further leads us to believe that pink diamonds are expected to be even more expensive in the future and that Argyle pink diamonds are expected to have a higher incline.