Rio Tinto Diamonds Launching Diamond Sourcing Program

Finance and Trade
28/07/2016 08:10

Rio Tinto Diamonds is to provide an audited mine-to-polished chain of custody for stones from its Argyle mine this month, while a Canadian Diamonds program covering its 60% share of production from the Diavik mine in the North West Territories will start later this year, writes Rob Bates in JCK Online. The programs have two aims, said Bruno Sané, Rio Tinto Diamonds’ general manager of marketing. For the trade, it guarantees the diamonds are not lab grown: “The screening technology today is less reliable with small and brown diamonds. The browns are usually rejected as type IIs. This makes sure your source is reliable.”

Meanwhile, for consumers, the program will provide proof of origin: “The younger generation is looking for more and more transparency, and they are extremely well informed. This gives information about where the diamond is coming from and explains the journey the diamond has been on. We are proud of the contribution we have made to local development in Australia and Canada. We think this will resonate with the young consumers.”

The program uses manufacturers’ existing systems, then places controls and audits on top of them. Sané said he doesn't expect extra costs to be an issue: “Most manufacturers track their products to understand the profitability of their rough. The only cost is the inventory cost because you have to keep the goods segregated and wait until you have your order. So it’s more a financial cost rather than a manufacturing cost. But once we reach a critical mass, those costs will disappear.”

The diamonds don’t have to be sold specifically as Australian or Canadian diamonds, but Rio Tinto has created marketing materials for retailers who want to market them as such, including information about all the steps in the diamond’s journey – from the mine through to the cutter, Bates writes. So far, all of Rio's Select Diamantaire manufacturers (though not all its trading partners) have adopted the program. See here for more details.