Diamonds for most people mean glittering gem stones used in jewellery. And indeed, in terms of value, this represents the greater part of the diamond market. The other part of the market, while smaller in value terms, is larger in terms of volume and is accounted for by diamonds used for industrial applications like drill bits and grinding media, ie uses where diamonds are valued for their natural hardness rather than their appearance. Rio Tinto is a large producer of industrial diamonds from its Argyle mine in Western Australia and a smaller, but growing, producer of gem diamonds. Rio Tinto's 60 per cent owned Diavik diamond mine in Canada commenced production in 2003.

The demand for gem diamonds follows broad trends in economic growth. When a country's economy is growing fast, and the standards of living of its citizens are rising, then they will generally be more prepared to spend their money on luxury items like diamonds. However, while the demand for diamonds overall may follow general economic activity, demand can shift significantly amongst different products.

With the growth of techniques for cutting smaller and smaller diamonds, markets have developed over recent years for jewellery containing clusters of small diamonds, this in addition to the more traditional use of larger stones in engagement and eternity rings.

While diamonds quite evidently have a large and intense public following, concerns over diamond production have arisen in recent years. First, concerns have arisen over the use of child labour for cutting and polishing diamonds, especially in India. Second, it has been alleged that proceeds from the illegal sale of diamonds have been used to fund conflict, especially in Africa.

To ensure that its diamonds are not instrumental in these abuses, Rio Tinto has set up its own marketing programme with customer standards to ensure control over the processes of cutting, polishing and sale. Rio Tinto is not a producer in any of the areas considered to be producers of so called "conflict diamonds" and is a signatory to the diamond industry's Kimberley Process, which seeks to ensure only legitimately mined and traded diamonds enter the market.