Red discoloration keeps coming back
 

I purchased this Bugis Lombok keris in Lombok. When it arrived at my contact person he discovered a red discoloration on the tip of the wilah. He cleaned it off but when he put is back in the warangka, the red discoloration appreared again. He brought the keris to his Empu and the Empu discovered this (see the photo). Any ideas what it is?

Your post confuses me a little. You are not showing the keris blade here with the discolourization, just a pile of red dust. Where was this, inside the wrongko? I'm not sure what it is, but it doesn't quite look like rust accumulation.
Also confused by "He brought the keris to his Empu..." I did not realize that people can have a personal empu. Are you sure you don't mean pande/smith? ;)

or perhaps m'ranggi?

or tukang wrongo?

very likely OP isn't showing the kris to abide by the forum rules, it may be for sale

OP says that he purchased the keris. I see nothing in his comment that implies the keris is currently for sale.