Why Pink Diamonds Remain a Good Investment in Australia
Almost three years ago news spread like wildfire among diamond connoisseurs and investors about the impending closure of the pink diamond mine in Western Australia. While it officially closed in November 2020, interest and investment prices of its alluring pink treasures continue to climb.
When Rio Tinto launched operations at the mine in 1983 it sparked a previously unseen popularity in pink diamonds. Two years on from the closure of the mine and many people are still fascinated about the future of pink diamonds.
In an article by Jewellery World, Anna Cisecki, Executive Director of Australian Diamond Portfolio, said that over the past few years she's seen prices increase by well over 50 per cent, on average.
"Interestingly, while it was vivid pinks that saw the most explosive price growth in the 2021 financial year ... demand began to turn toward the lighter, more affordable pinks, with prices responding to this, especially as availability on the market continues to decrease."
York Jewellers Managing Director and Head Jeweller Douglas Ely reports that he has seen even more interest in pink diamonds over the past few years, given their limited availability.
"I can say that the prices we paid for pink diamonds have increased significantly, and there is no end in sight given how difficult it is becoming to source these stones for the future," says Ely.
Top FAQ's about the current investment status and future of pink diamonds
Why are pink diamonds in Australia a good investment?
A few factors make pink diamonds a significant investment. The first is that these precious stones are a well-established form of investment. But pink diamonds have gained considerable popularity over the past twenty years, both for aesthetic reasons and as a viable investment outside of the more traditional gold and silver. Additionally, the closure of the mine in Western Australia looks set to raise the value of pink diamonds further.
Portfolio Diversity
Amongst a period of broader market instability and uncertainty, investing in commodities like pink diamonds can be a prudent choice. They're a unique and rare physical asset that are no longer being produced en masse, and boast a track record of steady appreciation.Auction Performance
Pink diamonds have consistently drawn higher prices at auction than their white counterparts. They're also highly 'liquid' - that is, able to traded easily.Stable Appreciation
Pink diamonds have been shown to possess a strong negative correlation with equities markets, making them resilient to outside volatility and economic crises.
Why did they stop mining pink diamonds?
Every mine has what is called its 'mine life', which refers to when the mine has reached the point where slowing yields mean it is no longer economically viable to continue operating. Since owner Rio Tinto began production in 1983, the mine has produced over 90 per cent of the world's supply of rare pink diamonds. However, while it is possible to find a new source in Australia, it takes 10 -15 years for a mine to go from detection to the point of commercial production. What's more, only one source has been found in the last 30 years, making a new source of diamonds highly unlikely in the near future.
Are there other Pink Diamond mines in the world?
The mine in the Kimberly region of Western Australia was the largest pink diamond mine in the world. Pink diamonds are still found in other locales, including Brazil and Russia, however around 90 per cent of the world's pink diamonds originated from the mine in Australia.Who owns the rarest pink diamond?
The 59.60 carat Pink Star is the rarest pink diamond, valued at over $72 million. It was held in Sotheby's inventory and sold to Chow Tai Fook jewellery retailer for a reported 490 million Hong Kong dollars (US $63 million) in 2017. It is still the single most expensive diamond jewel or diamond to be sold at auction.Who owns the most famous pink diamond?
While there are a few notable pink diamonds owned by famous people, the recent passing of Queen Elizabeth II has sparked a new set of questions, with the most prominent surrounding who would acquire the royal collection of jewels. While it has been reported that Kate, the Princess of Wales, is set to receive the "lion's share" of Queen Elizabeth II's jewellery collection, Camilla, the Queen Consort, will get the first choice. Among the collection is the Williamson pink diamond brooch. The Queen received the 54.5-carat rough pink diamond in 1947 as a wedding present from the Canadian geologist Dr John Thorburn Williamson. The gem was designed by Frederick Mew of Cartier in London in 1953 and set as a floral brooch.Where can I buy pink diamonds?
View March 2024 Pink Diamond Event
*The Australian mine is currently in the process of a five-year program to decommission it before returning the land to its Traditional Owners.
NOTE: The information contained here and on other pages of the York Jewellers website does not constitute financial advice.