Rio Tinto Exits Diamonds, Big Blow Looms for Surat diamond industry

Surat | Gujarat — The global diamond trade has entered a historic turning point as Rio Tinto officially exited the diamond business, ending decades of mining and trading that shaped the rough diamond market. The shutdown of the iconic Argyle Diamond Mine in Australia signals what industry leaders describe as the “end of an era” — and the ripple effects are already being felt in Surat, the world’s largest diamond cutting and polishing hub.

For Surat’s diamond sector, which relies heavily on imported rough stones, the decision could significantly tighten supply, particularly of small-sized and rare pink diamonds. Industry insiders warn that the closure may reshape pricing, sourcing strategies and long-term planning across the sector.

A senior diamond trader said, “Rio Tinto was one of the most reliable suppliers of rough diamonds to India. With their exit, the supply chain is bound to feel the pressure, especially in the small and fancy diamond segments.”

End of a 70-year global diamond chapter

Rio Tinto’s move marks the first time in nearly seven decades that one of the world’s top diamond producers has completely stepped away from the natural diamond business. The mining giant has shifted its strategic focus toward minerals critical for the global energy transition, including iron ore, copper and lithium.

Experts say the decision was driven by multiple factors — declining reserves, rising extraction costs and changing global demand patterns. “The Argyle mine had reached the stage where deeper mining was no longer economically viable,” noted a mining analyst. “Add to that the growing competition from Alrosa and De Beers, and the rising influence of lab-grown diamonds, and the business case became weaker.”

Pink diamond shortage fears grow

The closure is particularly significant because the Argyle mine produced more than 90% of the world’s pink diamonds — among the rarest and most valuable gemstones. With the mine permanently shut, supply of these prized stones has effectively stopped.

Industry experts say prices of pink diamonds have already surged. “The existing inventory of pink diamonds has suddenly become far more valuable. We are likely to see long-term scarcity and sharp price increases,” said a Mumbai-based diamond exporter.

Surat industry prepares for shift

In Surat, manufacturers and exporters are closely monitoring the situation. Many believe the reduced availability of rough diamonds could push up costs and accelerate the industry’s shift toward lab-grown diamonds.

A Surat-based exporter said, “This development will force the industry to adapt. While natural diamonds will always remain valuable, the future may see a stronger balance between mined and lab-grown stones.”