The Hudson Museum at the University of Maine may have the oldest known emerald and the only known Pre-columbian carved emerald. The emerald green gem was carved into the shape of a standing figure. It is 2.2 inches tall and weighs 118.5 carats.

The stone was given to the university by alumnus William P. Palmer, III in 1982. An index card which came with the artifact states:
"Emerald figure of a man. To the best of my knowledge the only Emerald carved in the round piece in existence [sic] of Pre-columbian origin. Area unknown, 500 B.C. to 250 A.D."

The piece was purchased or delivered March 30, 1968 from a New York City dealer. The University performed a battery of nondestructive tests to determine whether or not the stone was an emerald or a synthetic.

The overall appearance and color of the stone are consistent with a natural emerald rather than an epoxy fake. The stone's refractive index, the ratio between the velocity of light passing through a vacuum and light passing through emerald, is within the range of natural emerald. When the stone is viewed through a Chelsea filter, which absorbs most visible light but transmits the long red wavelengths and a band in the yellow-green portion of the spectrum, a definite reddish area appears, consistent with natural emerald from Colombia.

The stone's spectrum, determined with energy-dispersive X-rays in a scanning electron, is consistent with emerald. X-ray fluorescence shows the figurine shares trace elements, including copper, barium, zinc, rubidium, and titanium that are consistent with Muzo, Colombia. The figurine gave off a red glow under long-wave ultraviolet light. This glow is typical of synthetic emeralds, but also characterizes emeralds from Chivor, Colombia. Under short-wave ultraviolet light, 98 percent of the surface gave off a purplish-red glow, which is characteristic of true emeralds.

How the emerald was cut is unknown. According to the University, the figurine's appearance is similar to some small, stone figures made by the Olmec of the Gulf Coast of Mexico during the period from 900 to 600 B.C., but it lacks certain characteristics to make identification certain. The piece has stronger similarities to stone figures carved in Guerrero, Mexico. Mesoamericanists have not agreed about the relationship between Guerrero and the Olmec. The University suggests the soil remaining on the figurine could be chemically matched to a particular site.

Colombia was the only known source of emeralds in the Western Hemisphere during this time period. Emeralds were traded as far south as Bolivia and as far north as Mexico. Possibly a trader carried the emerald from Colombia to Mexico on foot or by boat along the Pacific coast, or it could have been passed from hand to hand. Colombian sources were being mined earlier than 1000 A.D. and polished emeralds found in graves in Panama were dated between 700-900 A.D. It is believed the Muzo source was being mined nearly two millennia earlier. Emeralds occasionally come from secondary deposits, produced by weathering or other decomposition of the emerald-bearing matrix, rather than from mines, but such deposits are rare. One is located at Ganchalá, Colombia, but its trace elements are not as close a match as Muzo's.

There is only one other historical description of a Pre-columbian emerald which could have been carved. During the Conquest, Cortés sent emeralds from Mexico to the Spanish court, including one from the Hall of Justice in Texcoco, which was reported to be shaped like a pyramid and as broad as the palm of the hand. The object disappeared en route to Spain.


DeBeers Sales Down
Sales of DeBeers rough diamonds declined 42% in the first half of 1998 compared to 1997. They sold $1.7 billion, a sharp decline from $2.9 billion in 1997. The reason for the cutback is the Asian crisis. DeBeers states diamond prices would have fallen if not for their action. The Russian economic crisis may cause the dumping of diamonds for hard currency into the international markets. The United States and Europe remain the prime diamond markets today. Look for weakness in these markets unless the Christmas season is strong.

New Mine Owners?

AZCO Mining, Inc. is considering purchasing the Chivor Emerald Corporation. The present Canadian owners have been losing money at the mine since they started searching for emeralds in 1996. They modernized Chivor with computer modeling and modern mining methods, but found very few goods and continue to lose money. AZCO is the Canadian company that recently purchased the benitoite mine in California.

According to a new 1997 World Bank study, Colombia is one of several top ranked countries for corruption. The survey asked 4000 entrepreneurs in 69 countries to rate 15 areas as to how seriously they obstruct business. The list included taxes, corruption, inadequate supply of infrastructure, policy instability, labor regulations, crime and theft, price controls, foreign currency regulations, financing, foreign trade regulations, regulations for starting a new business, general uncertainty on costs of regulations, terrorism, safety or environmental regulations, and inflation.

Heroin Problem
Colombia has had more than 40,000 people killed this decade because of the narco-financed guerrilla conflict. Colombia is a killing zone and the growing heroin problem is claiming more lives every day on the streets of the United States. In July, the DEA reported that more than 75 percent of heroin seized here originates in Colombia.

The legendary General Rosso Jose Serrano of the Colombian National Police has requested increased law enforcement assistance from the Clinton administration. Presently, none has been delivered. In the last ten years, more than 4,000 policemen were killed and more than 10,000 fired for corruption in Colombia. Gen. Serrano was responsible for hunting down Pablo Escobar and locking up or killing all the kingpins of the Cali Cartel. He is under constant threat of assassination.

Many of the mines in Mogok were closed this summer due to the rainy season. The summer's production came from the washing of byon, or gem-bearing gravel, that was mined during the dry season. Quality production remains down and Mogok's best years are unfortunately over.

Many rubies now are coming from the Dat Thaw and Gadoothat areas of the valley, both of which are uncovered from associated limestone. The shading tends to be a bit light and purplish, and the Gadoothat stones contain a good deal of lamination. You can find beautiful stones, but pure red is extremely rare.

A few open pit mines are producing both rubies and sapphires, but these are not common. InnGaung might now have the best rubies. Kaday-Kadar, site of a major government mine in Western Mogok, is still yielding the best sapphires, and finding stones of size is far more common than in rubies. As has always been the case, a lot of big stones, when found, are smuggled out so as to avoid the immediate 20% assessment tax levied by the government. The new site at Ohn Dan, about fifty km west of the Mogok Valley, is still only yielding souvenir quality sapphire crystal, and is unlikely to ever amount to much.

There is a lot of talk about new government rules which are supposed to take effect next year. It is all still a bit unclear, but it seems that the government will not be renewing any private mining licenses, and will take over all operations in the valley. I am not really sure what this will do to pricing. On the one hand, the government tends to price stones (at auction) far above what one can pay from a private miner. At the same time, any sort of clampdown undoubtedly will lead to an increase in smuggling. If I were to make a guess, however, I would say prices are going to rise, especially when considered together with the overall decline in production. Incidentally, I spoke with a few miners who are not unhappy with the non-renewal of their licenses, as the yield from their mines (in various parts of the valley) is not paying for the costs of production. Yet another reason to look for rising prices.

Many thanks to Andrew McGrath, a Hong Kong gem dealer, for this exclusive report.

The mines are reopening after the flood. Prices in the United States remain stable while prices in Tanzania are up. You can presently buy tanzanite at the old prices, but expect higher prices when the new goods arrive.

Dealers returning from Bangkok report prices are firm for all qualities, but deals can be had with tough negotiations. The lower the quality of goods, the more room for discounts. Fine collector quality colored gemstones remain in strong hands.

Reports indicate an American dealer is in Bangkok buying $10 million worth of diamonds due to the baht devaluation. Is this a case of smart buying in a down market or bottom fishing?

Value of Japan/US Colored Gemstone Imports
Colored gemstone imports reflect a society's wealth. Japan and the United States have been fighting for the title of number one importer for years, with Japan winning in 1995. In 1997, Japan's imports fell to less than 50% of the United States imports. Expect this trend to continue.

Source: Ministry of Finance
Japan & US Census Bureau


Electric Raspberry Spinel
We have recently seen some samples of a new color of spinel. Dealers claim it is from a new mine in Burma. It can best be described as electric raspberry. Technically, it is probably red/pink/purple. It is a very pleasing color and we believe this color may be an excellent speculation.

Color Change Gems Increase
According to the "Guide", a pricing publication, prices are increasing for alexandrite and color change sapphire. Alexandrite has increased 25% because of lack of supply from Russia and Brazil. High end color change sapphires increased 25% from three to five carats because of increased demand. We also have seen price increases for color change spinel (blue to purple as shown at left).

Merelani Mint Green Garnet
A new colored gemstone has recently been introduced into the marketplace from the Merelani Hills of Africa. It is termed mint garnet, and technically, it is a light tsavorite garnet. It kind of looks like a green diamond or a demantoid garnet. Another inexpensive and interesting speculation.

Mandarin Orange Garnets
The supply of gem quality Mandarins remains dismal and upward pressure continues on prices.

Madagascar Ruby
Madagascar, the island off of Africa, is now producing ruby. The colors tend to be more red-purple than the red-pink from Burma. The tones are also darker in the Madagascar goods. Although many of the inclusions are similar to Burma, the African goods only fluoresce moderately under long wave UV. A rare, fine, bright, light toned gem may be worth collecting.

Alternatives to Emeralds
With so much "bad press" regarding the treatment of emeralds, consumers are searching for green alternatives. Here are the top choices:

Arkansas Diamonds
Eight years ago Shirley Strawn found a three carat rough diamond at the Crater Diamond State Park. She had been searching the park every day for a year. She recently had it recut into a 1.09 D-Flawless.


BBC: Thursday, June 18, 1998
Pigeon in the Sky With Diamonds
Pigeons have become the preferred mode of transport for South African diamond smugglers. Police in South Africa have shot dead a homing pigeon which was carrying more than £6,000 worth of uncut diamonds taped around its chest. The pigeon was spotted sitting exhausted on the main street of Alexander Bay, a diamond mining centre in the desert on South Africa's west coast. Residents of the town, who had seen the bird several times since Sunday, called the local police, who sent out a search party. An officer shot the bird, and discovered six small bags containing more than 50 uncut diamonds taped around its chest. A BBC correspondent in Johannesburg says diamond smuggling using carrier pigeons is a huge problem for multi-national mining companies in South Africa. Criminals working inside the mining compounds tape the diamonds to the pigeon's legs or body and then release it. When the bird flies back home to its roost, the owner recovers the illegal cargo and sells it on the black market. Last year dozens of people were arrested for using pigeons to smuggle diamonds out of mining compounds in the Alexander Bay area. The mining companies have struggled to contain the problem. Some have even threatened to cull all pigeons discovered within range of some of the bigger diamond mines - a move that has brought strong protests from pigeon fanciers in gem mining areas.


Florida Cat Burglar Arrested
Police in Miami arrested the cat burglar dubbed "Spiderman" in June for speeding and found recently stolen jewels. He was known for scaling high-rise buildings with his bare hands, wearing sandals, and knowing the difference between costume and real jewelry. The police believe he committed 133 burglaries over the past 4 1/2 years. Derrick James, a 33-year-old former Army paratrooper, was arrested and jailed without bail for breaking into the Bristol Towers in Miami. Spiderman was known for his superhuman upper-body strength. He would climb quickly from one balcony to another without hooks or ropes on high rise buildings. Then he would break into the upscale condos through the terrace glass. A Miami jeweler claimed to have paid him $800,000 for jewels worth $8 million.

Big Rocks On A Roll
Big, large and loud jewelry is back in style, according to an article in the "Wall Street Journal", August 21, 1998. People are collecting earrings as big as grapes, bracelets as large as bar coasters, and elaborate chokers dripping with stunning jewels. The international style today is to wear the biggest rocks you can afford to buy.

The driving force behind this is the booming stock market, high fashion, and the Hollywood factor. The trend started when Kate Winslet, the star of "Titanic", wore a 17 carat pear shaped diamond to the Academy Awards. Sharon Stone wore a jeweled dragonfly, Linda Hamilton wore diamonds in her hair, and Cher wore diamonds in her tear ducts. Also, as women age, they want larger gemstones. According to author Antoinette Matlins, over age 30, "a carat seems small".

Cartier jewelers previewed their new fall line with models in a New York restaurant. They wore unique pieces such as a diamond and platinum parrot ring with a 10 carat blue sapphire for $198,000 and a watch encircled with two diamond encrusted dolphins for $380,000. Many high end jewelers are seeing their average sales increase.

The auction houses may have started this trend in 1987 with the $50.3 million Duchess of Windsor sale. The wealthy have always been able to afford the finest gems, but now they are buying bigger and rarer pieces than ever before. According to John Block of Sotheby's, "It's not just `I want pearls' anymore. It's `I want black Tahitian pearls' or `I want blue-colored diamonds'." Some contend this trend will last for another 5 or ten years.

The information provided in this newsletter has been derived from research and sources believed to be reliable. However, no guarantee is expressed or implied as to their validity. Opinions included herein are subject to change without notice. The gem market is speculative and unregulated. Certification does not eliminate all risks associated with the grading of gems. Recommendations are meant for those who are financially suited for the risks involved. Past performance is not a guarantee of future performance. Neither NGC nor The Gemstone Forecaster guarantee a profit or that losses may not be incurred as a result of following its recommendations. They may also hold positions in areas they recommend. Subscribers should not view this publication as investment advice, nor is it intended as an offer or solicitation with respect to the purchase or sale of any security.
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