How Rio Tinto Is Framing Diamonds as Works of Art

At the close of last summer, invites to a very exclusive party started to land in the inboxes of the world’s top diamond dealers, jewelers and private collectors. The sender was Rio Tinto, and the event was the launch of The Art Series.

While the title might suggest that the miner was breaking into a new industry, it was in fact a new concept for selling fancy-colored diamonds. The invite-only tender, also known as the Beyond Rare Tender, was a collection of 87 rare polished diamonds, including pink and red specimens from the Argyle mine in Australia, and yellow ones from Diavik in Canada. Besides 11 matched pairs and 30 single stones, there were seven grouped sets called “Masterpieces,” which came with accompanying bespoke artwork.

Those who made it onto the invite list had a month to view the stones’ credentials through a dedicated online portal before attending The Art Series’ in-person events in Australia, Switzerland and Belgium in mid-October. The miner then gave bidders another month to mull over what they had seen, with sealed bids closing on November 20.

Rio Tinto Minerals chief executive Sinead Kaufman has described the Beyond Rare Tender as “a new chapter for Rio Tinto’s diamond business, and a testimony to the ongoing demand for highly collectible natural diamonds.”

The demand is certainly there. While the diamond market has softened in general, prices for pinks have remained protected, according to dealers. And prices for rarer red diamonds have increased 25% since 2020, reports dealer Leibish & Co.

Still, The Art Series is not just about catering to preexisting demand; it’s also about stirring it up and adding value. By presenting colored diamonds as art in this way, it is encouraging us to view such stones as we might a piece of serious art: as an investment-grade collectors’ item that we also enjoy in the moment for its beauty.

A matter of strategy

The inclusion of pink Argyle diamonds in the sale caused a split reaction among dealers and jewelers, as it went against the narrative that had been driving up prices since the mine’s closure in 2020.

“In the industry, we said with full confidence to our clients that when the mine is shut, no more pinks are going to come from that mine, and the demand skyrocketed,” says Harsh Maheshwari, executive director of Kunming International. And that was true, he points out; “there were no more pink diamonds that came out of the mine. These were Rio Tinto’s remaining pink diamonds that were kept in the vault to find a better way to present them and continue the legacy.”

Maheshwari believes Rio Tinto has struck upon a brilliant solution with The Art Series. “The tenders, the marketing…everything was beautifully done, and there was some hype around Argyles again because of the tender,” he says. Kunming was one of the event’s successful bidders, walking away with 14 lots, including two red diamonds.

Placing yellow diamonds from Diavik alongside the rare Argyle reds and pinks was a strategic move by Rio Tinto to elevate the status of the Canadian stones, believes Leibish & Co. president Leibish Polnauer, who successfully won stones in The Art Series as well.

“Rio Tinto is a master of brand management and value creation,” he says. “It is trying to capitalize on the Argyle brand value and extend it beyond the pink diamonds — an interesting move.”

Canada in focus

Rio Tinto is not the only company trying to amplify Canadian yellow diamonds. Just two days after the miner made its Beyond Rare Tender public news, Tiffany & Co. announced the acquisition of a 71-carat, fancy-vivid-yellow rough stone from Burgundy Diamond Mines’ Ekati deposit. Tiffany cut the rough into two polished diamonds of 15 and 20 carats.

The move reflects “Tiffany’s heritage of acquiring the most coveted gems on earth,” according to Victoria Wirth Reynolds, the brand’s chief gemologist. Tiffany also linked the stones to its earlier 2023 acquisition of “similarly rare” Argyle pink diamonds.

“The inclusion in the inaugural Beyond Rare Tender of two fancy-intense-yellow diamonds from Rio Tinto’s Diavik diamond mine is a beautiful counterpoint to the pink and red Argyle diamonds,” comments Patrick Coppens, general manager of sales and marketing for Rio Tinto Diamonds. “Yellow diamonds make up less than 1% of Diavik’s production, a rarity in a diamond mine otherwise known for its highly coveted white-diamond production.”

Coppens believes the market is ripe for such sales due to an “unwavering global demand for truly scarce gems,” and the plan is to hold more sales in the style of The Art Series.

Maheshwari, for one, will be there if there is, wringing his hands with nervous excitement as he awaits the fate of his sealed bids.

“Rio Tinto has built a beautiful ecosystem that has helped create value for something that would have been part of the rejection parcels for diamantaires 30 years ago,” says the dealer. Plus, he adds, the events “are a lot of fun.”

Image: The two fancy-vivid-yellow diamonds, weighing 15 and 20 carats, that Tiffany & Co. cut from an Ekati rough stone. (Tiffany & Co.)

This article is from the May-June 2024 issue of Rapaport Magazine. View other articles here.