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Oregon's Budding Gem Industry Needs Help

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Oregon’s abundant supply of natural gems comes from several unique subduction geology locations along the Pacific Coast line or North American plate over riding the Pacific sea floor plate.
The slide show shows some of Oregon’s home-grown colored gems that is a fledgling potential industry for disadvantaged rural residents to capitalize upon..
We all remember TV ads stating a diamond is a girl’s best friend; however, due to a diamond monopoly since 1893, most guys cannot afford diamond rings without banking on a serious future marriage bankruptcy later.
We consumers allowed this monopoly on precious stones to evolve and it impacts all of us daily in our choices of special gifts for loved ones. It used to be only kings could afford fine jewelry; but things are changing due to the Internet sales.
Oddly the Asia market prefers colored gems stones; so De Beers for decade promoted diamonds as a lady’s best friend as the Chinese lady could care less. However, young Japanese lady’s swallowed the hook.
Why do we care here in Oregon? The cover photo shows Oregon colored gems stones and our local jade or China’s favorite scarce sacred jade.
Originally, the Great Spirit created gemstones for free for all to share; however men figured out how to control markets and raise prices for people looking for permanent pretty stones.
Early Egyptian sailors could go to a secret island in the Red Sea and he could actually pick up future girlfriend a very special light green gems to give his girlfriend back at home port.
Peridot by Peter Bancroft
http://www.palagems.com/peridot_buyers_guide.htm
Zabargad Mines (St. John’s Island), Red Sea, Egypt
“By the dawning of ancient Egypt, swarthy sailors had landed on a tiny island in the Red Sea. Treeless and scorched by a brutal sun, the bleak land offered no food or water–but glittering olive-green crystals lay scattered about the ground. Explorers gathered a few which eventually came to the attention of Egyptian royalty in the capital city of Thebes.
According to Agatharchides in his De Mare Erthraeo, Egyptian kings ordered the discoverers to collect gems and deliver them to the royal gem cutters for polishing.
In Naturalis Historia, Pliny tells of the first specimen presented to Berenice, Theban queen of Lower Egypt, about 300 B.C.
First called the Serpent Isle, then the Island of Topazos, followed by St. John’s Island, and currently Zabargad (Arabic for peridot), the oft-named island was systematically worked for hundreds of years, possibly as early as 1500 B.C. by the Pharaohs.
Later before the time of Christ, the Ptolemies who ruled Egypt also worked it. Officers of Egyptian courts directed mining activities and used slaves for labor. Workers reportedly died by the hundreds and few ever left the island.”
Even today, an enterprising young guy has a hard time finding unique jewelry for a special female friend at a reasonable cost; unless he finds it himself in the field. If you want to find a guy that knows the subtle art of subduction – date a geologist!
Historically, king and queens or royalty felt special things were too good for commoners! These DeBeers Monopolies punish average Americans and world citizens alone.
However, the key to keeping any special items cheap is too have lots of sellers of this product.
De Beers fighting to restore monopoly; challenges lie ahead
http://articles.economictimes.indiatimes.com/2013-03-24/news/37981320_1_...
"More competition does influence prices and reduce the influence of De Beers... I don't believe that De Beers will ever truly be on top again," says Martin Rapaport, founder of Rapaport Diamond Report, the primary source of diamond prices and market information.

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DIGGING DEEP INTO HISTORY
Till late 19th century, diamonds were extremely rare and found largely in Brazil and India. In 1860, large diamond mines were discovered near the Orange River in South Africa.
The Incredible Story of How De Beers Created and Lost the Most Powerful Monopoly Ever
http://www.businessinsider.com/history-of-de-beers-2011-12?op=1
“For decades, De Beers has been the preeminent name in diamonds.
Thanks to a stockpile of the world's rough diamond supply, indelible marketing schemes and even negotiations with foreign governments for their diamonds, De Beers — owned by the Oppenheimer family since the 1920s — has been the most important name in one of the world's most lucrative businesses for almost a century.
But with recent news of the Oppenheimers selling out to fellow mining company Anglo American, it's time to look back at the billion dollar rise and fall of a monopoly that has crushed competitors and cash-strapped governments since the 1800s.
Diamonds became a symbol of love thanks to De Beers, which is fitting, since De Beers became what it is today because of a love story: the love of money.
In the beginning, the diamond trade took place mostly in India and Brazil. With the discovery of diamonds in South Africa, the trade simultaneously took off and become much less profitable.
Up until the mid-1800s, diamonds were a rarity and could be seen only on the hand of a monarch. But the diamond rush that began in South Africa in the second half of the 19th century flooded the market with diamonds, which, as any good businessman knows, kills demand.
It would take some ingenious plotting and advertising to keep the diamond's reputation as intrinsically valuable and desirable, which is where De Beers comes in.
The story of De Beers starts with English-born businessman Cecil Rhodes, who broke into the diamond business in South Africa by renting water pumps to miners before buying diamond fields of his own
Cecil Rhodes, sensing he had ventured into an untapped market, bought up diamond fields, including one owned by two brothers named "de Beer." In 1880, he bought the claims of fellow entrepreneur and rival Barney Barnato to create the De Beers Mining Company.
The tendency in diamond mining is to combine with smaller groups to form larger ones. Individuals needing common infrastructure form diggers committees and small claim holders wanting more land merge into large claimholders. Thus, it only took a few years for De Beers to become the owner of virtually all South African diamond mines.
In 1888, De Beers Consolidated Mines, Ltd. was formed, creating a monopoly on all production and distribution of diamonds coming out of South Africa
By the time Rhodes died in 1902, De Beers controlled 90% of the world's rough-diamond production and distribution, but it was Ernest Oppenheimer who made the company an empire…. Under Oppenheimer, De Beers and its Central Selling Organization established exclusive contracts with suppliers and buyers, making it impossible to deal with diamonds outside of De Beers.
The structure of the business remained the same for much of the 20th century: A De Beers subsidiary would buy the diamonds. De Beers would determine the amount of diamonds they wanted to sell, and at what price, for the whole year. Each producer would then get a cut of the total output, and buyers would take their diamonds to be resold in places like Antwerp and New York.
A worldwide decline of diamond prices in the 1930s led the Oppenheimer family to begin their world famous marketing campaign, "A diamond is forever."
The United States was seen as the next big market for diamonds, and a very effective game plan was formed to sell diamonds to Americans: convince them that diamonds equated love.
Through advertising, men were convinced that the size of the diamond in an engagement ring showed how much they loved their fiancée. Movie stars were shown wearing diamonds in the relatively new motion pictures. And the most effective piece of advertising came in 1947, with the creation of the tag line "A diamond is forever." This later becomes the company's official motto.
As a result of these campaigns, the number of brides receiving engagement rings, and diamond prices in the U.S., increased dramatically.
Having conquered the United States by the 1960s, De Beers set its sights on new territories.
Japan never had a tradition of romantic marriage, making diamonds a tough sell for brides. And even by 1959, no imported diamonds were allowed into the country by the postwar government. But by using slick advertising, playing up diamonds as a symbol of the modern west, or a way to break from traditional Japanese norm, De Beers was able to build a billion-dollar-a-year industry.
By 1981, almost 60 percent of Japanese brides wore diamonds, up from 5 percent in 1967.
The discovery of diamonds in Siberia in the 1950s was a threat to the control De Beers kept over the diamond supply. Rather than compete with Russian diamonds, De Beers offered to buy almost everything that came out of Siberia — funneling the entire world's diamonds through a "single channel."
Numerous "revolts" against the De Beers cartel had occurred in places like Zaire and Israel over the years, which were mostly quashed by De Beers releasing stockpiles of diamonds similar to that county's product, driving down demand.
But more recently, countries with enormous stockpiles of their own, like Russia, Canada and Australia, have refused to cooperate with the single channel system.
These problems, along with issues of flat prices, forced De Beers to switch up the company's strategy. In the last decade De Beers has moved away from rough-diamond supplying and controlling the entire industry, instead focusing on promoting its own brand of diamonds and retail stores.
On the Origins of Gems
http://www.nytimes.com/2014/03/17/fashion/on-the-origins-of-gems.html
Every February, gem and mineral dealers from around the world flock to this city in the Arizona desert for a confluence of buying shows that function as the trade’s version of a debutante ball. And every year, intense speculation centers on which gem will be crowned the proverbial belle.
The critical factor in determining a favored new gemstone is not color, as many people might suspect. Rather, it is quantity. In other words, is the gem available in volumes substantial enough to support a commercial trade?
“It all depends on what’s coming out of the ground,” said Divyanshu Navlakha, co-owner of Sutra, a jeweler based in Houston that specializes in high-end colored stone designs.
By these standards, an enchanting variety of white opal from the Wollo Province of Ethiopia was Tucson’s undisputed winner.
“I saw, literally, tables full of it,” said Robert Weldon, manager of photography and visual communications for the Gemological Institute of America. “It’s the talk of the town.”
Discovered in 2008, the Wollo goods made their first major appearance in Tucson in 2010, when only a handful of dealers had access to the material. Over the past four years, however, more merchants — charmed by the gems’ lively appearance, their affordability and, of course, their abundance — have gotten in on the action. The subsequent rush has driven wholesale prices up by at least a factor of three.
“When it first came out, it was new, fun, exciting and cheap — and rarely do you get all those things in the same sentence,” said Jerry Romanella, co-owner of Commercial Mineral, a Phoenix-based gem dealer that has sold Ethiopian opals in large quantities since 2010.
“It used to be $35 to $125 per carat,” Mr. Romanella said. “Now, a very nice pretty Ethiopian opal is $100 to $300 a carat, so it’s catching up with the Australian.”
Gem shortage elevates prices.
“Today we have a lot more sources producing material,” said Stuart Robertson, research director for Gem world International, publisher of the Gem Guide, a compendium of pricing and market information. “The industry is still trying to figure out how to sell that illusion of rarity for material that isn’t quite as rare.”
The new marketing monopoly is based on brand-name location of future colored jewels politically!
Oregonian could band together to make that transition to a sustainable, world-wide gem stone market. However, rural residents need advice on approaching an international market. We have the quality gems laying on the grounds; but nowhere to sell them except friends?
“The point underscores one of the fundamental tenets of the gemstone business. Unlike diamonds, colored stones do not conform to a universally accepted grading standard. To determine the value of a fine gem specimen, you need to know more than its 4Cs (color, clarity, cut and carat weight). You need to know its origin….
Kashmir sapphires can command as much as $25,000 per carat at wholesale, while look-alike stones from Madagascar may fetch only a third of that. But the market’s obsession with origin does not end there. Prices on emeralds, for example, can vary by thousands of dollars, depending on whether the gems are from Colombia, Zambia or the less desirable tracts of Brazil.
Much of that disparity comes down to aesthetics; the best Colombian crystals are prized for their electric green coloring, a product of near perfect combinations of chromium and vanadium. Do not, however, overlook the role that the Moguls of India played in building a centuries-old reputation for emeralds from Colombia’s famous Muzo district.
“A lot of colored stone promotion came from the history books,” said Ian Harebottle, chief executive of Gemfields Resources, a London-based mining company that co-owns and operates the Kagem emerald mine in Zambia, as well as a large new ruby concession near the village of Montepuez in Mozambique.”
Mr. Harebottle has plenty of reasons to reframe the debate over the true value of origin. After a millennium of ruby mining in the Mogok region of Myanmar, it is taken as gospel that Burmese stones — especially those deemed to be the color of “pigeon’s blood”— are “the standard by which everything else is compared,” Mr. Hughes said.
Yet Myanmar’s ruby mines have long been stripped of their low-hanging fruit, and production has slowed to a trickle.
As a matter of necessity, the trade has shifted its focus to the Montepuez deposit, with Gemfields leading the charge. The company, one of the few in the gem world that is well financed enough to employ mechanized equipment and staff geologists — acquired 75 percent of a 131-square-mile license area near Montepuez in 2011 and has spent the past three years creating a grading system for the rough rubies found there. …Colored stones are not an easy geology, but Gemfields is doing what De Beers did 50 years ago” with diamonds, Mr. Harebottle said. “We are creating the science.”
Oregonian do not want a world science of exclusion like in the diamond industry had during the 1800s to limit competition; as Oregonians could be players in this New World Market for colored gems on a new ideal equal playing field with our own quality gems eventually coming to market with State counsel and technical help..
However, gems lying in the ground do no Oregonian any good either. Oregonians are ranchers and loggers and we have very few clues on how to develop a new commodity or asset to sell all across a new World market-niche.
The State of Oregon needs to take an interest in this ideal, lucrative rural community wealth development and State Officials need to help prospectors learn how to properly exhume and effectively market these new world-class gemstones.
We have the world class quality of gems and our local deep forest green spinel is tougher than ancient promoted forest green emeralds from India.
Best thing about our Oregon hard stones? One can drop spinel on the concrete and it will not crack or break; however, very costly diamonds & emeralds are notorious for breaking.
Oregon’s polished cut chrome green Spinels really are forever!
“The market, of course, found its own resolution. “We’ve seen the Mozambique material break $20,000 a carat but it probably trades at two-thirds of the Brazilian,” Mr. Robertson said.
That, however, is cold comfort to buyers who passed up the opportunity to stock up on the original blue tourmaline when it was still an unknown quantity. “When I discovered Paraíba, I thought it was so crazy looking,” said Erica Courtney, a designer based in Los Angeles. “And at $600 a carat, it was super duper expensive. I didn’t even know if I could sell it.”
Ms. Courtney paused to reflect on her decision to forgo the gems from Paraíba 20 years ago. “That’s one of the mistakes of my life,” she said
A World Diamond Monopoly Declines As a Colored Gems Market Expands. Does Oregonians want to be a world player?

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