HK's rich and famous expected to snap up rare, pink diamonds

PUBLISHED : Sunday, 23 September, 2007, 12:00am
UPDATED : Sunday, 23 September, 2007, 12:00am

The hosts of the world's only closed auction for rare, pink diamonds are hoping to achieve record prices following exclusive viewings in Hong Kong this week.

Just a handful of the region's top diamond dealers have been invited to individual viewings of the 65 diamonds in Rio Tinto Diamond's 2007 Argyle Pink Diamond Tender, being held at a closely guarded secret location until Friday.

Rio Tinto, which produces 90 per cent of the world's pink diamonds at its Argyle Mine in Western Australia, said the quality of its 2007 collection was 'outstanding' and was expecting it to attract intense interest from guests, who included jewellery designers and luxury retailers.

A 1.74-carat oval diamond - dubbed the 'Lady in Red' at the tender's opening session in Perth for a highlight that resembles the silhouette of a woman in a tunic - is among the show's prized red stones.

Red diamonds are a subclass of pink diamonds, and the rarest diamond. They reach prices 20 times those of white diamonds, often fetching more than US$400,000 per carat.

The collection includes four red diamonds, two of which weigh more than a carat, and a total of 32 diamonds weighing at least one carat.

Senior marketing executive Gavin Pearce said: 'This year's collection is significant in terms of its depth of colour and size and will easily surpass previous years in its total value. I think the bidding will be very competitive.

'It was an exceptional year coming out of the mine. It was very hard to choose from about 100 tender diamonds. The number of vivids and the number of deep stones is well and truly above average. There are 35 to 40 stones in the collection that have various forms of magenta hue.'

Mr Pearce said he hoped the 1.74-carat oval red would set a new record in the price per carat achieved for the sale of a polished diamond. It was one of the mine's 'most significant stones' in the past 10 years and would become a 'name stone'.

'This diamond will be sought after by the world's collectors because it is an extremely rare diamond,' he said. 'It could end up being bought by a celebrity or a collector.

'I would expect that Hong Kong connoisseurs will take a significant percentage of this year's special collection. These are rare diamonds and they are getting even rarer. The Argyle Mine will close in 2018 and we expect to see the rarity premium manifest itself in this year's tender result.'

The Hong Kong viewings will be followed by a New York session, which runs from October 1 to 12. A total of 80 individuals are expected to take part in the tender across the three cities. Closed bidding for the diamonds will end on October 17 and the successful bidders will be notified the following day.

The Argyle Mine is the world's single biggest diamond mine by volume, producing on average 30 million carats of rough diamonds each year. From these, about 8,000 to 10,000 carats of polished pink diamonds are produced; just 65 carats are selected for the pink diamond tender.

Open-pit mining at the site is set to be virtually exhausted next year, but construction has begun on an underground pit, to extend the Argyle's production until 2018. Spiralling prices in West Australia's construction market, the rising Australian dollar and difficult ground conditions have sent development costs on the new pit soaring.

Think pink

Per carat, pink diamonds often fetch in US dollars as much as: $400,000