Sotheby`s Australia was anticipating great things in their first stand-alone jewelry auction last night.  Among their many beautiful pieces was a bit of national pride, an extremely rare purplish-red diamond from its own Rio Tinto Argyle Mine.  Red diamonds are unique to this location, and only a few are produced each year, so expectations were high for this one.  With a reserve set at $700,000 and an estimate of $700,000-$1 million, the buyers were less enthusiastic.

There was a lot of interest in this rare piece, a 0.82-carat fancy purplish-red round brilliant set between two blue diamonds and encircled by white diamonds, and the diamond industry as a whole took note that this stone was going up for auction.  In 2004, a 0.91-carat red diamond brought in over $1 million at a Hong Kong auction.  Sotheby`s began receiving calls from interested parties in both Asia and North America, but reserve seemed to put them off.  This is unusual, as the higher-ticket, ultra-luxury items still have a strong market, but bidding never went above $445,000. 

The auction included over 250 lots, of which the red diamond was the star attraction.  Among the items which sold were jewels by Bulgari, Tiffany & Co., Paspaley South Sea Pearls, and Cartier.  Also for sale were watches from both Cartier and Rolex, and loose diamonds—all GIA-certified—in white, pink, and yellow. 

Had the red diamond sold, it would have broken the previous record for any piece of jewelry sold at auction in Australia.  The honor is still held by a 5.35-carat un-mounted brilliant-cut white diamond, which sold for $456,000 at Sotheby`s in 2007.  The diamond may still be sold as a private sale, or could be held by the owner until the market is more seller-friendly.