Here is an interesting overview on the state of emerald mines and the new business model for the industry.
Andrew Lucas (GIA), Eric Welch (GIA), Jean Claude Michelou (ICA, Colombia), Marcelo Ribeiro (Belmont LTDA, Brazil), Luiz Martins (Stone World, Brazil), Pedro Padua (GIA) and Sergio Martins (Stone World, Brazil) writes:
South America is considered by many in the gemstone industry to be the most important continent for emerald production. Colombia is the number one exporter of emeralds to the United States, and Brazil is also a highly important commercial source of emeralds. This information was obtained during two trips to the mining areas organized by the International Colored Gemstone Association and subsequent correspondence with ICA members.
The techniques used to explore and develop new mines, such as the Piteiras mine in Minas Gerais, Brazil, are typically more common for diamond mines than for colored stone mines. Emerald cutter and wholesaler Stone World of Sao Paulo, Brazil, formed a joint venture with Seahawk Minerals to vertically integrate the operation from mine to cutter to wholesale office. The Belmont mine, also in Minas Gerais, began in a more traditional process for colored stone mines. Emeralds were found on this property, which still operates as a cattle ranch. The Belmont mine began as a highly successful open pit operation, which continues today. The most advanced resources in geological modeling and mine planning have led to the opening of an underground mine to complement the open-pit operation. Belmont has an extensive sorting operation for their rough to meet the needs of their customers.
The La Pita area in Colombia has become the major commercial emerald-producing area in the country, with most production coming from the Consorcio mine. A number of other productive underground mines also exist in this area by the Rio Minero, including the La Pita Tunnel, Cunas, El Totumo, and Polveros mines. The Puerto Arturo mine in Muzo is still in production and under control of the Carranza group, which also has a minor partnership in the Consorcio mine and an influential stake in the Cunas mine. Many of the mine stakeholders in Colombia, whether they have interests in the La Pita, Muzo, Coscuez, or Chivor areas, are also involved in cutting and wholesale sales of polished goods.
Saturday, June 16, 2007
The Missed Boom...
Chaim Even-Zohar writes about the contraction of the rough diamond supply sources + pros and cons of present acquisitions and mergers in the mining world + explanations on non-diamond boom, especially in copper, cobalt, gold, zinc and nickel @
http://www.idexonline.com/portal_FullEditorial.asp?TextSearch=&KeyMatch=0&id=27576
http://www.idexonline.com/portal_FullEditorial.asp?TextSearch=&KeyMatch=0&id=27576
Gemstones Of The Future
Joel Arem writes:
Jewelry store is where the public learns about stones. And the typical jeweler’s business in colored stones is only 10% +/- of his overall trade. Because of this most jewelers are not well informed about colored stones and cannot effectively promote them. A cyclical chain of events begins here at the jewelry store and ends there as well. What is not offered to the public, the public has no chance to discover, and without awareness there is no demand. Therefore obviously without demand, there will be no sales or increased sales. The break in this vicious circle will come only through education. As we all know, education in the form of advertising is expensive but this is what is needed to change the direction of the gemstone market. The best example of this is the classic success story of the diamond industry on a grand scale and the familiar story of tanzanite on an impressive smaller scale. We, the gemologist, jeweler and gem dealer, have the responsibility to educate the public about what gems are available. This can be accompanied by increasing the varieties displayed and more importantly knowing all there is to know about each and every one of them. Of the 259 mineral + species only 30-40 are durable enough for us in jewelry and of the remainder about 15 are seen with regularity and are considered commercial. The rest are either too soft or fragile and should be classified as what he terms the ‘collector’ stones or ‘exotics’.
It is necessary to consider some of the reasons why diamonds are so popular. The first consideration is supply. There is sufficient quantity available to be marketed on a large scale. The market was created and maintained brilliantly. What the public buys is what the public sees. If gems are not shown to the public through the jewelry stores and if they are not promoted at this level, they will never become popular. There is also a fine balance between supply and demand. Some gemstones have disappeared from the marketplace due to exhausted sources. Gems are like oil wells, when they are depleted that’s the end. You go to some place else.
The real excitement will come when the gemologists can convince the jewelers to learn, to promote and to teach the public. This will achieve a ground swell of interests that will result in exposure, high prices, more enthusiasm and mining + new localities. It will all start to happen. It’s our job and our challenge.
Jewelry store is where the public learns about stones. And the typical jeweler’s business in colored stones is only 10% +/- of his overall trade. Because of this most jewelers are not well informed about colored stones and cannot effectively promote them. A cyclical chain of events begins here at the jewelry store and ends there as well. What is not offered to the public, the public has no chance to discover, and without awareness there is no demand. Therefore obviously without demand, there will be no sales or increased sales. The break in this vicious circle will come only through education. As we all know, education in the form of advertising is expensive but this is what is needed to change the direction of the gemstone market. The best example of this is the classic success story of the diamond industry on a grand scale and the familiar story of tanzanite on an impressive smaller scale. We, the gemologist, jeweler and gem dealer, have the responsibility to educate the public about what gems are available. This can be accompanied by increasing the varieties displayed and more importantly knowing all there is to know about each and every one of them. Of the 259 mineral + species only 30-40 are durable enough for us in jewelry and of the remainder about 15 are seen with regularity and are considered commercial. The rest are either too soft or fragile and should be classified as what he terms the ‘collector’ stones or ‘exotics’.
It is necessary to consider some of the reasons why diamonds are so popular. The first consideration is supply. There is sufficient quantity available to be marketed on a large scale. The market was created and maintained brilliantly. What the public buys is what the public sees. If gems are not shown to the public through the jewelry stores and if they are not promoted at this level, they will never become popular. There is also a fine balance between supply and demand. Some gemstones have disappeared from the marketplace due to exhausted sources. Gems are like oil wells, when they are depleted that’s the end. You go to some place else.
The real excitement will come when the gemologists can convince the jewelers to learn, to promote and to teach the public. This will achieve a ground swell of interests that will result in exposure, high prices, more enthusiasm and mining + new localities. It will all start to happen. It’s our job and our challenge.
Friday, June 15, 2007
Deal Cut On Elephants And Ivory
Richard Black writes about the deal made by South African nations on the immediate future of the ivory trade @ http://news.bbc.co.uk/2/hi/science/nature/6751853.stm
Blue Nile Blues
Rob Bates writes about Blue Nile, the thriving dot-com company that has been around for only eight years with striking sales of US$300 +/- million @ http://jckonline.com/article/CA6447692.html
Blood On The Stone
The documentary "Blood on a Stone" traces the diamonds to legitimate mining companies in the Kono region of Sierra Leone and show that living conditions are primitive, with no schools for the worker's children, no electricity for their homes, and no hospitals. Like company-employed miners, illegitimate diamond miners, who may find a diamond every two or three years, have never heard of the Kimberly Process and have no idea of the eventual value of the diamonds for which they live and die --- and they do die. The Kimberly Process is a start, but the lives of Sierra Leone's poor still receive no benefit from even the legitimate diamond industry.
More info @ http://www.cnnasiapacific.com/programs/en/program/54/
More info @ http://www.cnnasiapacific.com/programs/en/program/54/
When The Music Stops
Chaim Even-Zohar writes about the musical chair-like scenario, the game currently in progress in the diamond industry @ http://www.idexonline.com/portal_FullEditorial.asp?TextSearch=&KeyMatch=0&id=27534
Synthetic Stones
There are many in the industry with different views on how to describe a synthetic gemstone. I totally agree with Tom Chatham. He has been misunderstood + he has every right to air his views on his product. The world is changing and people are buying Chatham created stones.
Thomas Chatham writes:
Profit is the best test of created gems and over the years of my association with the Chatham emeralds and rubies, I have most often heard the following question: “How can I sell something not real? Or the statement: “I only sell natural gemstones in my store.”
When I hear those declarations of allegiance to natural stones, my reaction is swift, after muttering a silent prayer for the soul of the retailer who has just uttered those fateful words. “It’s not you the retailers lack of understanding,” I tell them, “It’s the marketing philosophy that has been projected to you that is directly opposed to every rule I know about retail store management.”
It can be difficult to comprehend that we actually grow emerald and ruby crystals that are the same as those nature grows. I realize not everybody is an FGA or GIA graduate. After all, to suggest to anyone that you can do exactly what nature does is a little hard to swallow. But that’s exactly what my father did learn how to do over fifty + years ago. However, it was not the equivalent of re-inventing the wheel when his results were emeralds. He only discovered the right door and the right combination to unlock that door through which emeralds would flow. Carroll Chatham discovered not a process which produces emeralds and rubies, but a set of conditions which duplicates the environment in which nature will grow an emerald or ruby crystal for him.
Chatham does not manufacture the emerald or rubies—nature does, under conditions controlled by Chatham. There is nothing artificial about the emeralds or rubies sold by Chatham.
Now back to the retailer who has just told me he sells natural stones only. AS he flicks an imaginary piece of lint from his lapel, I can’t help but see the four carat stone in his pinky ring.
‘Coke bottle,’ I think myself.
‘Aha…beautiful Peridot,’ I purposely misidentify.
‘That’s a natural emerald,’ he immediately retorts. (I look for the aura to form around him.) What has offended my ear is not his lack of chemistry background (why should he have any?) but his lack of business sense. The jewelry industry today is one of the last trades that is struggling through the process of evaluating its purpose and direction.
And it’s not good business for a jewelry store owner or buyer to say that he won’t sell something that should be right in the middle of his inventory. I don’t care what an individual like or dislikes personally. It’s not important whether he’s white or black, French or Chinese. Or if he will only wear 18K gold or insist on chrysoberyl cat’s eye for his personal jewelry. What he should care about is why we’re all in this business. We’re in it to make a profit—not convert to our own personal likes and dislikes. You and I serve the public. Some things they like, some they don’t. That’s the system and the public will decide. Up until now, the public decided it wanted everything you showed them. As a matter of fact, there were so many people out there eager to buy that you could show them only what you liked and still have a good business. But not any more.
Things have changed a little. And they’re still changing. Gold has gone crazy in price, and you can’t profit from it. Diamond prices are momentarily unstable, and the price of decent-looking emeralds not within everyone’s reach and good rubies has skyrocketed out of sight. Discount houses are moving in right and left. Department stores are upgrading their lines.
“How can they do this?” you ask yourself, “Why would anybody buy fine jewelry in a discount house? I have fine jewelry.”
The answer is that discount houses and department stores are into marketing. They’re in the business to make a profit and they have to sell merchandise. They know there is no room in their marketing philosophy for personal preference in products. They feel the public is out. If they see a winner they go all out. Sure, they have their likes and dislikes, but not to the extent of eliminating an entire section of their inventory. It’s that attitude that makes me want to climb the showcase at a trade show. They buyer that announces their store will sell only natural stones is telling me:
“We limit ourselves.”
“We actually turn away business.”
Now, just so you don’t think Chatham is just chewing on sour grapes, I’ll share a little inside information with you.
Please keep this confidential.
Our yield of cut stones, with maximum success in the lab (no goof-ups by Mother Nature—a common occurrence) would only supply three one carat stones to each jewelry store in the US. But we don’t even come close to doing this. We still have set backs in the laboratory and we are constantly short of material.
Expand? Sorry, but we have no more family members available to help in the lab. Anyway, why grow more emeralds when I hear people at trade shows making proclamations of abstaining from purchasing all but the stones found in the ground?
“If Chatham would make a big splash at the public with national advertising in all the major consumer books, a direct campaign four or five times a year, or perhaps sponsor a TV special like the Osmonds, we’d love to handle your stones,” says the retailer.
Well, I couldn’t pay for it. Nor could I justify it in view of our limited supply. It would create a market that I could not supply. Don’t get confused with the idea that selling the finest natural gemstones should mean that’s the only thing you should sell. It’s not so much what you sell that is responsible for building the reputation you seek, but how you sell and represent the products you offer.
The way we live and the consumer goods we consume reflect the highest standard of living in the world. To achieve this luxury we have all had to re-evaluate what is acceptable to give us the overall ‘Best of Life’ conditions. Our clothing is derived all from natural fibers grown in artificial environments or just plain made from scratches with nylon or rayon.
The jewelry industry today is one of the last trades that is struggling through the process of evaluating its purpose and direction. In the beginning, only royalty had the wherewithal to possess jewelry with precious stones. Over the years, spectacular economic growth has led to sales of fine jewelry the average person can afford. However, that progression is now in danger. Due to a multitude of reasons, the cost of the basic materials in jewelry has risen at an unprecedented rate, which, if it continues, will once again put fine jewelry as we know it today, in the reach of only the wealthy. Man-made gemstones may help answer that dilemma, since they do not cost as much as natural gemstones. That lower price means that the beautiful gemstones do not have to move beyond the reach of the middle class.
What will happen to natural stones? Will their value fall? How can the jeweler sell something he may not be able to separate from a stone found in the ground? As with the reaction to other advances in chemistry, those who think they will be adversely affected by these advancements have a natural inclination to mistrust or outright disbelieve the assurances of the ones who made the discoveries.
After all, these discoveries may make them obsolete. But just as there will always be the customer for a Rolls Royce, there will always be that customer for the $50000 per carat emerald or ruby. As for the separation between the stone grown in the ground and the one grown in the laboratory, reputable dealers and gemologists will solve the problem.
I hope man-made gemstones will soon arrive at the same position of prestige in the eyes of both the trade and the general public as cultured pearls enjoy today. There was once a preoccupation with the separation of natural pearls and cultured pearls. By the time the experts determined a method on separation, no one cared. Somebody finally said, “Hey, what’s the big deal?”
Sure some people were hurt in the transition. But, today there are more pearls than ever being sold. Although exclusivity has been traded for volume, natural pearls still command high prices. True synthetic gemstones are an opportunity for everyone to enjoy and possess the original beauty responsible for gemstones becoming so sought after in the first place.
Thomas Chatham writes:
Profit is the best test of created gems and over the years of my association with the Chatham emeralds and rubies, I have most often heard the following question: “How can I sell something not real? Or the statement: “I only sell natural gemstones in my store.”
When I hear those declarations of allegiance to natural stones, my reaction is swift, after muttering a silent prayer for the soul of the retailer who has just uttered those fateful words. “It’s not you the retailers lack of understanding,” I tell them, “It’s the marketing philosophy that has been projected to you that is directly opposed to every rule I know about retail store management.”
It can be difficult to comprehend that we actually grow emerald and ruby crystals that are the same as those nature grows. I realize not everybody is an FGA or GIA graduate. After all, to suggest to anyone that you can do exactly what nature does is a little hard to swallow. But that’s exactly what my father did learn how to do over fifty + years ago. However, it was not the equivalent of re-inventing the wheel when his results were emeralds. He only discovered the right door and the right combination to unlock that door through which emeralds would flow. Carroll Chatham discovered not a process which produces emeralds and rubies, but a set of conditions which duplicates the environment in which nature will grow an emerald or ruby crystal for him.
Chatham does not manufacture the emerald or rubies—nature does, under conditions controlled by Chatham. There is nothing artificial about the emeralds or rubies sold by Chatham.
Now back to the retailer who has just told me he sells natural stones only. AS he flicks an imaginary piece of lint from his lapel, I can’t help but see the four carat stone in his pinky ring.
‘Coke bottle,’ I think myself.
‘Aha…beautiful Peridot,’ I purposely misidentify.
‘That’s a natural emerald,’ he immediately retorts. (I look for the aura to form around him.) What has offended my ear is not his lack of chemistry background (why should he have any?) but his lack of business sense. The jewelry industry today is one of the last trades that is struggling through the process of evaluating its purpose and direction.
And it’s not good business for a jewelry store owner or buyer to say that he won’t sell something that should be right in the middle of his inventory. I don’t care what an individual like or dislikes personally. It’s not important whether he’s white or black, French or Chinese. Or if he will only wear 18K gold or insist on chrysoberyl cat’s eye for his personal jewelry. What he should care about is why we’re all in this business. We’re in it to make a profit—not convert to our own personal likes and dislikes. You and I serve the public. Some things they like, some they don’t. That’s the system and the public will decide. Up until now, the public decided it wanted everything you showed them. As a matter of fact, there were so many people out there eager to buy that you could show them only what you liked and still have a good business. But not any more.
Things have changed a little. And they’re still changing. Gold has gone crazy in price, and you can’t profit from it. Diamond prices are momentarily unstable, and the price of decent-looking emeralds not within everyone’s reach and good rubies has skyrocketed out of sight. Discount houses are moving in right and left. Department stores are upgrading their lines.
“How can they do this?” you ask yourself, “Why would anybody buy fine jewelry in a discount house? I have fine jewelry.”
The answer is that discount houses and department stores are into marketing. They’re in the business to make a profit and they have to sell merchandise. They know there is no room in their marketing philosophy for personal preference in products. They feel the public is out. If they see a winner they go all out. Sure, they have their likes and dislikes, but not to the extent of eliminating an entire section of their inventory. It’s that attitude that makes me want to climb the showcase at a trade show. They buyer that announces their store will sell only natural stones is telling me:
“We limit ourselves.”
“We actually turn away business.”
Now, just so you don’t think Chatham is just chewing on sour grapes, I’ll share a little inside information with you.
Please keep this confidential.
Our yield of cut stones, with maximum success in the lab (no goof-ups by Mother Nature—a common occurrence) would only supply three one carat stones to each jewelry store in the US. But we don’t even come close to doing this. We still have set backs in the laboratory and we are constantly short of material.
Expand? Sorry, but we have no more family members available to help in the lab. Anyway, why grow more emeralds when I hear people at trade shows making proclamations of abstaining from purchasing all but the stones found in the ground?
“If Chatham would make a big splash at the public with national advertising in all the major consumer books, a direct campaign four or five times a year, or perhaps sponsor a TV special like the Osmonds, we’d love to handle your stones,” says the retailer.
Well, I couldn’t pay for it. Nor could I justify it in view of our limited supply. It would create a market that I could not supply. Don’t get confused with the idea that selling the finest natural gemstones should mean that’s the only thing you should sell. It’s not so much what you sell that is responsible for building the reputation you seek, but how you sell and represent the products you offer.
The way we live and the consumer goods we consume reflect the highest standard of living in the world. To achieve this luxury we have all had to re-evaluate what is acceptable to give us the overall ‘Best of Life’ conditions. Our clothing is derived all from natural fibers grown in artificial environments or just plain made from scratches with nylon or rayon.
The jewelry industry today is one of the last trades that is struggling through the process of evaluating its purpose and direction. In the beginning, only royalty had the wherewithal to possess jewelry with precious stones. Over the years, spectacular economic growth has led to sales of fine jewelry the average person can afford. However, that progression is now in danger. Due to a multitude of reasons, the cost of the basic materials in jewelry has risen at an unprecedented rate, which, if it continues, will once again put fine jewelry as we know it today, in the reach of only the wealthy. Man-made gemstones may help answer that dilemma, since they do not cost as much as natural gemstones. That lower price means that the beautiful gemstones do not have to move beyond the reach of the middle class.
What will happen to natural stones? Will their value fall? How can the jeweler sell something he may not be able to separate from a stone found in the ground? As with the reaction to other advances in chemistry, those who think they will be adversely affected by these advancements have a natural inclination to mistrust or outright disbelieve the assurances of the ones who made the discoveries.
After all, these discoveries may make them obsolete. But just as there will always be the customer for a Rolls Royce, there will always be that customer for the $50000 per carat emerald or ruby. As for the separation between the stone grown in the ground and the one grown in the laboratory, reputable dealers and gemologists will solve the problem.
I hope man-made gemstones will soon arrive at the same position of prestige in the eyes of both the trade and the general public as cultured pearls enjoy today. There was once a preoccupation with the separation of natural pearls and cultured pearls. By the time the experts determined a method on separation, no one cared. Somebody finally said, “Hey, what’s the big deal?”
Sure some people were hurt in the transition. But, today there are more pearls than ever being sold. Although exclusivity has been traded for volume, natural pearls still command high prices. True synthetic gemstones are an opportunity for everyone to enjoy and possess the original beauty responsible for gemstones becoming so sought after in the first place.
Subscribe to:
Comments (Atom)