Diamond

Everything changed in the "diamond world" when diamond stones started being discovered outside of India. First, there was Borneo and then somewhere along the line Brazil and China joined the fray. Then the glittering light of the diamond appeared in South Africa. It happened in the 19th century. The first known South African diamond was picked up on a beach on the African coast by a boy who was walking through the sand. This event precipitated a new "diamond rush" with its roots in that part of the world.

Two Afrikaner brothers owned a farm where the Orange and Vaal rivers join. Johannes Nicholas de Beer and Diederik Arnoldus de Beer had diamonds discovered on their property. They were in no position to protect the property from diamond hunters and predators so they sold it for 6300 pounds to investors Cecil Rhodes and Charles Rudd. Two mines were actually found on the property located in the Kimberly region. One mine was named after the original owners of the property, and the other one was named after the area. The De Beers and Kimberly mines were consequently born. Rhodes and Rudd merged the two enterprises to form De Beers Consolidated Mines Limited. It couldn't have happened at a better time.

When De Beers was founded on March 13, 1888 Africa was starting to feel the impact of industrialization. The "Mineral Revolution", in Africa certainly fueled by the emergence of modern business concepts there. When diamonds were discovered there was a critical demand for laborers. Migrant labor was utilized as young men from everywhere flocked to work in the mines, but it was an unstable way to run a booming business.

De Beers started closing the compounds, and having the workers sign contracts for fixed amounts of time. They also started utilizing the black labor force because they could pay them in accommodations and meals instead of actual wages. During apartheid they received state permission to use prisoners to work in their mines, sometimes as many as 10,000 a day.

The company did a lot to further the retail side of the diamond industry. They dealt only with preferred customers and sold diamonds from their own mines in South Africa and Botswana. They also sold the stones on an "as is" basis. They also worked with agencies to promote diamond sales and lore in anyway that they could, such as striking a deal with the English Royal family to promote the gems. Their Public Relations firm, N.W. Ayer & Son coined the phrase "a diamond is forever". They also flooded the American market, and other countries where diamonds were considered a symbol of high status. Then when artificial diamonds that were produced in laboratories started to appear on the market they took measures to protect their investments. Today natural diamonds are imprinted with a special serial number to make the differentiation.

De Beers reigned as the supreme supplier of diamonds until other countries began successful operations. One country is Australia. Diamond entrepreneurs and geologists began searching for kimberlite pipes in the Kimberly region of Western Australia in 1969. The search went on for 10 years and on October 2, 1979 the Argyle pipe was discovered. Once it was decided that the enterprise would be economical they started to mine the area in 1983, and the Argyle Diamond Mine was given its commission in December 1985.

The Argyle Diamond Mine is owned by the Rio Tinto Group who also owns the Murowa mine in Zimbabwe and the Diavik Diamond Mine in Canada. Argyle is presently the largest diamond producer in the world. It is the only place in the world where large volumes of pink diamonds are mined. It is an open pit mine, located 1200 miles from Perth that has been in operation since the company began business. There is a plan to begin underground operations in the near future.

Pink and red diamonds are in high demand on the market. Argyle specializes in colored diamonds. They use a firm in Perth to disseminate the polished gems all over the world. Argyle furnishes 90-95% of the pink and red diamonds that are circulated on the market. An Argyle diamond has been known to bring as much as one million dollar a carat. These would be intense pink diamonds. They come in a whole range of colors ranging from pastel rose to a purple-red. The price is determined by the intensity of the color. Their best stones are sold through Pink Diamond Tender, a special catalog. If a buyer wants to investigate possibilities on-line, they have to have a password to get into the system. The opportunity is not for the general public, but for serious investors and privileged clients.

Argyle also mines other types of colored diamonds which are used in a secondary market. They can profitably mine them because of the massive volume they can produce.