Just over a month ago, the largest rough pink diamond ever found in Australia surfaced at Rio Tinto Group’s Argyle mine. But that isn’t enough for the company best known for its domination in the field of iron ore, not precious gemstones. Nor is BHP Billiton Ltd. content with its presence in the rarefied world of diamonds. Both are looking to sell their diamond mines in a realignment of business that would see them abandon gemstones for baser ores.
Bloomberg reported Wednesday that despite the fact that in 2010 the two companies together accounted for about 16% of diamond production by value, neither is happy with what for them is merely a sideline to their dominant business: iron ore. The two companies, together with Vale SA of Brazil, have cornered some 63% of the market, according to estimates from Bloomberg.
De Beers sent 31.3 million carats of diamonds to market in 2011, compared with Rio Tinto’s 11.4 million for the same period, and OAO Alrosa, based in Russia, also topped Rio’s output.
Billiton has already solicited bids on its diamond properties; Rio Tinto is considering divesting. Harry Winston Diamond Corp. is one of the companies said to be involved in talks to buy Billiton’s Ekati diamond mine in Canada.