2002 Gem News Archive

Dec. 5, 2002: Big Mama’s in the House

In what certainly ranks among the most extraordinary specimens ever unearthed, Pala International has acquired an incredible 10,100 ct. Mogok Burma ruby crystal. No, that is not a typo. This piece really does weigh more than two kilos! Affectionately named “Big Mama,” it is available for viewing by appointment.

Big Mama’s in the house. This extraordinary 10,000-ct. Mogok (Burma) ruby crystal is among the finest specimens ever unearthed. Photo: R.W. Hughes/Pala International [back to top]

Sept. 5, 2002: Beryllium Diffusion Coloration of Sapphire

For the past 11 months, Palagems.com has been reporting on the new sapphire treatment from Thailand and we now have important new information from the AGTA.

The AGTA has been working closely with John Emmett and Troy Douthit to study the causes of color in these treated gems, and has just posted the latest findings on their web site at: Beryllium Diffusion Coloration of Sapphire.

The Emmett/Douthit experiments were undertaken with high regard to scientific process and were designed to answer the question of exactly what role beryllium plays in coloring these gems.

To answer this question, Emmett/Douthit heat-treated high-purity synthetic colorless sapphire in the presence of beryllium. The beryllium diffused into the gem and colored it.

What this demonstrates is that beryllium alone, unlike hydrogen, can strongly color sapphire. The experiments provide strong evidence that bulk-diffused beryllium, in and of itself, creates the color changes seen in these treated gems.

In our opinion, the latest Emmett/Douthit findings show a clear difference between beryllium bulk diffusion, and the hydrogen bulk diffusion that is a component of traditional corundum heat treatment.

While these results are preliminary, we believe if/when they can be verified, they will put to rest most questions on these stones.

Regarding this treatment, we summarize the evidence to date:

Treatment: Bulk diffusion of beryllium via high temperature heat treatment

Colors: Beryllium bulk diffusion creates a yellow-orange color in corundum, as follows:

• Before: Colorless; After: Yellow to gold
• Before: Pink; After: Pinkish orange
• Before: Red; After: Orangey red
• Before: Green; After: Yellow to gold

Identification:

• In cases where the beryllium has not diffused completely through the gem, immersion in 3.32 liquid (di-iodomethane) with diffuse light-field illumination will reveal a yellow-to-orange color rim at and below the surface of the stone. This color rim conforms to the external shape of the gem. The effect is mainly seen in the padparadscha-like pink-orange colors and also some rubies.
• Where beryllium diffuses entirely through the gem (particularly in yellow to golden yellow stones), the stones are currently unidentifiable except with sophisticated SIMS and LA-ICP-MS methods. To the best of our knowledge, such equipment is not currently on site in any gemological lab in the world.
• All stones generally display evidence of high-temperature heat treatment. Some stones occasionally display evidence of melted surfaces and recrystallization of synthetic corundum on those surfaces.

If readers have questions regarding these stones or this process, we suggest contacting either the AGTA or GIA labs, who are closely cooperating in this regard. Overseas customers can contact other major labs, such as Gübelin, SSEF, CISGEM, D-GEM-G, GAAJ, GAGB, GIT, etc. [back to top]

July 14, 2002: Bulk Diffusion Treatment of Corundum

For information on bulk-diffusion treated sapphires and rubies, see the following links:

• The Skin Game by Richard W. Hughes
• Understanding the New Treated Pink-Orange Sapphires by John Emmett and Troy Douthit
• Questions about Treated Sapphires and Rubies from Thailand
  [back to top]

April 4, 2002: Burma Auction Results

Burma’s 39th Annual Myanma Gems Emporium ran from March 5–11, 2002. 485 foreign buyers from 11 countries attended, along with 234 local merchants. Most foreign buyers were from China, Hong Kong, Thailand, Singapore and Japan. Ruby buyers came mainly from Thailand.

Results from this year’s auction were stronger than expected, with the total sales being US$20,089,200. The breakdown for major gems was as follows:

• Ruby = 208 lots offered, of which 88 sold, for $13.5 million
• Jade = 1162 lots offered, of which 307 sold, for $5.7 million
• Pearls = 59 lots offered, of which 20 sold, for $673,833

Virtually all of the ruby lots came from the Shan State mines at Möng Hsu. The two biggest ruby buyers were both from Thailand. One lot weighing over over two kilos sold for over $1 million, while another of 4663 cts. also sold for over $1 million.

Below is a breakdown of the total sales of the most recent gem auctions:

• March 2002 = $20 million
• October 2001 = $9.5 million
• March 2001 = $10 million
• March 2000 = $25 million

Lots valued at less than $10,000 are sold by tender, while those with higher reserves are sold via auction.

Burma gem production. Official figures released by the Myanma Gems Enterprise (MGE) for the fiscal year 2000–2001 peg gem production as follows:

• Jade = 4,730 tons (down 9.76% from the previous reporting period)
• Ruby = 1.96 million carats (down 37.9% from the previous period)
• Sapphire = 6.06 million carats (up 33.8 % from the previous period)

As with most things official in Burma, it is hard to make much sense from these figures, particularly since they do not account for any of the goods smuggled from the country. We certainly have not seen the reported increase in sapphire production translate into increased availability of Mogok blues.

Other Burma notes. From what we can see, production of both ruby and sapphire from Mogok continues to decline, while that from Möng Hsu is steady. Indeed, the only thing that keeps prices for untreated Mogok ruby from ascending is the prevalence of treated material from Möng Hsu. Mogok material is actually hit with a double whammy, for the treated Möng Hsu material is on the whole a richer, purer red. Many people, exposed to the richer treated color of Möng Hsu, have unrealistic expectations for the untreated Mogok stone. Expectations that simply cannot be met.

Production continues from the Nanyazeik (a.k.a. Naya, Namya, Naya) deposit in Kachin State. Both purplish red rubies and fine red spinels are mined, and we recently obtained several fine stones from this deposit on our most recent buying trip. [back to top]

March 22, 2002: Credit Card Fraud a Problem for Online Sellers

The following was provided to us by our friend, Rob Lavinsky of iRocks.com. We have also received several of these orders from Indonesia, the Philippines and Romania and so caution all who are doing business via mail order to beware.

EXPANDED NOTE TO ALL DEALERS: In the past several days since I posted a warning note, I have heard from over a dozen people hit by this crime and I almost lost 12K myself, and so I am expanding my message here in the hopes that word will spread.

A ring of credit card thieves from Indonesia has been trying to purchase gold and gem crystals, gem collectibles, etc., using stolen card numbers. Beware of large orders of such items! These are convertible goods and they will then pawn these items for cash, leaving you to eat the monetary damages! Once the legitimate cardholder reports the fraudulent use of the card, they will get a refund and 60-90 days later the credit card company will withdraw the funds from your account. YOU are liable for the money if you did not verify the cardholder's identity first by confirming the billing address, as per the most recent VISA/MC regulations and recommendations. They have computer-predicted numbers only, and do not have the billing address info needed to assure that the numbers are legitimate. If you have any doubts, ask the customer to confirm billing addresses and then call the cardholder's bank to confirm that the card really belongs to that owner, particularly when the order is from Indonesia, Singapore, the UK, and Romania (this info according to MBNA Bank's loss prevention department, whom I called recently). Several of us have been hit by a "gentleman" named Ikwan using aliases such as "johnny panther" and "andy jesus".

Apparently, they run small charges of pennies to $1 on thousands of predicted numbers until they find a "hit," and then use that valid card number for purchases, even while the owner never notices the test charge that went through. They will use the cards to order $2500-3000 at a time, and spread large orders over 4-5 cards! You will get the money because the cards ARE good… they do not come back with a fraud rating until reported. However, the money will just be taken away later. Better to be careful now. The bank reps that I talked to were COMPLETELY resigned to this as a perennial OLD problem, that is new only to us. They were totally unsurprised when I called.

FOR SECURITY, VISA/MC now encourages card acceptors to confirm billing address of customers with each transaction, for the best discount rates and for maximal protection against card fraud. I personally participate in this program, despite the slight extra bit of time it takes to run charges. It is obviously worth the slight additional time required!

TO CUSTOMERS, PLEASE NOTE THAT THIS PROBLEM HAS ABSOLUTELY NOTHING TO DO WITH YOUR PERSONAL DECISION TO SPEND MONEY ON THE NET OR USE CARDS FOR ONLINE ORDERS! THESE CRIMINALS ARE NOT GETTING THEIR NUMBER FROM VENDORS YOU HAVE SHOPPED WITH ON THE WEB, BUT RATHER BY COMPUTER PREDICTION OF VALID NUMBERS AND TRIAL & ERROR. ANY CARD INFORMATION YOU PROVIDE TO ME (AND TO MOST VENDORS) IS COMPLETELY SECURE, AND I VERIFY ALL BILLING ADDRESSES PRECISELY FOR THE REASON OF AVOIDING SUCH FRAUDULENT USE OF YOUR CARD NUMBERS. THIS SITUATION IS A PROBLEM FOR DEALERS... WHILE THE CUSTOMER IS FULLY PROTECTED BY YOUR CREDIT CARD PROVIDERS, WE ARE NOT.

We knew this credit card problem existed, but had no idea how widespread it was. After sending the above message out to our subscribers, one dealer phoned us and said he was just getting ready to mail out $10,000 worth of goods to Indonesia when our message arrived.

One of the best tips we’ve heard is that the seller request that the buyer fax copies of the front and back of the credit card for verification.

Another is to call your bank that processes your credit card orders and request a verification that the shipping address is indeed the billing address of the card.

Below are some of the reader responses:

Within an hour after receiving your email, we did receive an email from Indonesia from a gentleman asking if we can send a 1ct RBC, D, VVS1 diamond w/ a GIA report to Indonesia. He indicated that he'll be paying w/ a credit card & was most anxious in shipping the stone via Fed Ex immediately. Suspiciously enough, he wasn't even concerned about the cost of the stone, just if we can send it to Indonesia immediately. Thank you very much for your email, that was a close one!

Hallo, Thank you for the mail. In Germany we know this problem in a different way. Here, people from Great Britain call via phone or fax the jewellers and ask for exclusive watches. They say or fax the credit card numbers. Its a so called "mail order". All cards a duplicated in GB. The calling people come from Nigeria or the Ivory Coast staying in GB. The jewellers lose the money. From Germany we can’t get the people in GB because they do nothing wrong in GB only in Germany!

I got popped for $8560.00 last year on a fraudulent charge. I sold a set of (2.10ct tw) diamond earrings. The credit card company came after me -6 months after the charge. I had no idea that they could do that. With the diamond earring cost and attorney's fees I had to shell out $14,760.00. I try to tell everyone I know in the industry (or out!!) about the fraud situation. Most people think that the merchant is covered by "insurance" from the credit card company.

One other variation I've noticed on one or two of the orders we received from Indonesia, where they actually gain access to the card holders billing information as well as the number and expiration date. We've reprogrammed the fraud parameters on our credit card processor to help but still an occasional one gets through. One thing we've done that helps with questionable overseas orders that Cardservice suggested is if any doubt we ask for a FAX of both front and back of credit card and a note saying it was authorized. No actual cardholders have ever objected when we explain in email our reasoning behind it and also explain it protects them as well as us (the merchant). and since we did that no chargebacks.

Thanks for the warning but we knew this 4 years back, what is best is to always call your bank and get the phone number of the issuing bank and check and see if the card is hot or if the address is the right one, as AVS only works in the US.

Unfortunately, it is a perennial problem for us too. While most of our business is wholesale to retailers, we do a good amount of direct selling to consumers who see our jewelry in magazines. To date, we’ve never been burned, but we’ve come close. American Express is in our opinion the most reliable and easiest to work with as far as verifying addresses and purchases. Since so many banks administer VISA and MasterCard, it’s not always as easy to verify the purchaser’s identity when they use those particular cards. All to often, the temptation of wider margins made through retail sales can blur our better judgment. We also get many calls from Malaysia and Russia. Seller beware.

[back to top]

February 25, 2002: Lab harmonization committee issues finding on treated orange sapphires, US traders lukewarm in their reaction

A group of four major gem labs (GIA, AGTA, SSEF and Gübelin) issued a statement on the new treated orange sapphires, declaring them to be treated, but refusing to use the term “surface diffusion.” Reaction from US traders has been decidedly lukewarm, as many do not believe it goes far enough in protecting consumers.
[Note: A full report from Palagems.com on this topic is now online at this link: The Skin Game] [back to top]

February 16, 2002: GIA Finds Elevated Beryllium at Skin of Treated Orange Sapphires

The GIA has issued a second report on the new treated orange sapphires. We strongly recommend that all read the report in full. Here is a brief excerpt from the report’s conclusion:

In summary, the data obtained in this investigation strongly suggest that something is being added to the corundum to account for the surface-related orange color layers. Additional research is needed to confirm these results, and it is our intention to test more samples from a variety of sources to get a more complete understanding of the process involved.

[Note: A full report from Palagems.com on this topic is now online at this link: The Skin Game] [back to top]

February 18, 2002: Postal Irradiation of Gems a Disaster

In a November, 2001 GIA study, a variety of gems were subjected to radiation similar to that proposed by the US Postal Service for mail decontamination to prevent anthrax attacks of the kind that occurred post-Sept. 11. The results were, to put it mildly, not good.

Irradiation of mail provides little protection to the general public and at enormous cost. We urge all our readers to contact their congressional representatives and tell them they are firmly against such postal irradiation. [back to top]

Jan. 29, 2002: GIA Issues Preliminary Report on Treated Orange Sapphires

The GIA has issued a preliminary report on the new treated orange sapphires. You can read the report at this link, and we strongly suggest that it be read in full.

According to the GIA’s preliminary findings:

According to the Academic Press Dictionary of Science and Technology (1992), one definition of diffusion is simply the movement of individual atoms through a crystal lattice. We cannot dispute that some kind of diffusion is taking place in these stones, since we know of no other mechanism that can create these distinct, surface-related color layers in corundum.…

We will continue to monitor the situation and plan to meet in Tucson with both scientists, gemologists, and other traders and will update this report as more information becomes available. [back to top]

Jan. 9, 2002 – Updated Feb. 1, 2002: Treated Orange Sapphires Raise Concern

Several weeks ago we reported on a new treatment process in Thailand for Songea (Tanzania) orange sapphires. We have now had a chance to examine a number of these stones from both Songea and Madagascar and they appear to be treated by a process involving heat and/or surface diffusion. Indeed, a combination of treatments is possibly involved.

Inclusions within the stones indicate that all have been exposed to high-temperature heat treatment. But some display features suggesting more. The AGTA lab in New York is currently studying these stones, and their initial report can be found at this link. We have provided a number of specimens to the GIA for analysis and will report on their findings as soon as we have them.

Color ranges and types. The end color range of these goods runs the gamut from yellow through golden yellow, to orange (including the range that encompasses padparadscha) and even into borderline ruby colors, some of which resemble red spinels. What initially began as a treatment for Songea sapphires has now spread to Madagascar pink sapphires, Thai/Cambodian rubies and even green sapphires from Australia and elsewhere. Pink stones are treated to oranges (including padparadscha colors), green sapphires are reportedly being treated to golden colors, and poor color Songea orange sapphires and purplish Thai/Cambodian rubies treated to better, redder colors.

Irradiation? We don’t think so. Initial reports reaching us said that some stones were possibly undergoing irradiation and that the color was unstable and would fade with prolonged light exposure. Shane McClure of the GIA has pointed out that such irradiation would not color an entire stone’s surface equally, which is what appears with many of these new stones.

Reports on initial fade tests have also resulted in no loss of color. Thus we believe that initial reports suggesting irradiation might be involved were incorrect. It now appears unlikely that the stones such as those pictured here have been irradiated.

Surface-diffusion treated? Possibly. An unusual characteristic in some stones is a surface-based orange color layer surrounding a pink core (see photos below). Superficially, it resembles surface diffusion. But unlike normal surface-diffusion treated gems, the facet junctions and girdle show no highlighting. Instead, what is seen is a layer of yellow-orange that follows the shape of the cut stone exactly. This suggests that at least the final portion of the treatment is applied to the cut stone, rather than the rough. More than five different sources have now independently reported to us similar orange rims on rubies, in addition to the now-common orange rinds on orange sapphires. Apparently burners in Thailand are taking poor-color Thai/Cambodian rubies and improving their color via this added orange color rind.

Recutting? Exercise caution. We attempted to recut one emerald-cut orange stone, but stopped after serious color loss was noted. Another source reported a similar loss of color during recutting. In other stones, the color appears to go all the way through. have reported recutting these color rind-free stones with little or no loss of color.

Other labs have issued natural reports. A number of people have contacted us with information that other labs have issued reports declaring these stones to be natural with normal heat treatment only.

We are aware that other labs have issued reports. We have read the online reports of Themelis.com, GRS and GIT and have been forwarded press releases from Thaigem.com and others. The initial Themelis report suggested a synthetic overgrowth of orange sapphire on a pink sapphire core. We find no evidence of this. [Note: the initial report has since been revised] The GRS and GIT reports (including the latest updates as of Jan. 31, 2002) suggest an alteration of the valence state of iron as the cause of the orange rims. Our discussion with other scientists here in America suggest that this may not the case. According to the information to which we are currently privy, for iron to produce a yellow color in corundum, iron substitutions on the order of 2–3% are required. This is not being found in these stones to the best of our knowledge.

One of the problems is that, according to what we have learned, the most likely coloration agent, Mg, is virtually undetectable at the levels of suspected involvement (tens of parts per million). Thus even well-equipped labs such as GIT, AGTA or GIA may not be able to find the Mg. The fact that slightly elevated iron levels are being found may even distract from the real colorant, which may be undetectable.

A second problem is that, again according to our current understanding, so little Mg may be required for this treatment that burners may not even be aware that they are diffusing Mg into these stones. A detailed description of Mg and Fe coloration in corundum can be found in the following reference: Emmett, J.L. and Douthit, Troy R. (1993) Heat treating the sapphires of Rock Creek, Montana. Gems & Gemology, Vol. 29, No. 4, pp. 250–272.

What to do? The jury is still out on these stones regarding the exact method(s) of treatment, cause of coloration and their long-term color stability. As more information arrives, we will provide updates. For the moment, we advise extreme caution in the purchase and sale of these stones.

[Note: A full report from Palagems.com on this topic is now online at The Skin Game] [back to top]

2001 Gem News Archive

Nov. 16, 2001: New Heating Process for Songea Sapphire

Sources from Thailand are reporting development of a new heating process for dark orange-red sapphire from Tanzania’s Songea district. The process has apparently been developed by a burner in the Thai gem trading town of Chanthaburi, and the material has been selling in that market since early September, 2001.

The process apparently involves heating material that previously did not respond well to treatment. Resulting colors run the gamut from a bright red reminiscent of Burma red spinel, through orange reds, to a pure orange. Golds and yellows are also reported.

[Note: A full report from Palagems.com on this topic is now online at this link: The Skin Game] [back to top]

Nov. 2, 2001: Pala’s Cutter, Meg Berry, Wins Award

Meg Berry, Pala’s champion gem cutter, has won yet another award, taking home 2nd place in the “Pairs and Suites” category for the AGTA 2002 Cutting Edge Competition. Her winning cut was a “Trio of Trillions”, two 2-ct. pieces of canary yellow tourmaline in a windmill cut and one 4.60 ct. spessartine garnet in a double windmill cut. The stones will be displayed at Tucson 2002 and the trophy will be awarded at the AGTA dinner dance. Congratulations, Meg!

Those with a properly equipped web browser can listen to Meg Berry discuss cutting (along with Richard Hughes discussing gems) at Michael Rogers’ Gem Secrets site. [back to top]

Oct. 29, 2001: New Burma Jade Mine

A new jadeite mine has reportedly been found in the Hkamti region in Upper Burma. Union of Myanmar Economic Holdings Ltd. (UMEHL) has apparently obtained permission to produce jade from the mine, a source from the Indo-Burma border reported. UMEHL is the Burmese military’s business arm, with most shares being owned by military officers.

A group of military officials, including State Peace and Development Council Secretary (3) Lt. Gen. Win Mint, the commander of North-West Command and four other ministers reportedly visited the Makyankha Mine near Makyankha village in Hkamti township on October 27, 2001.

Permits for this new mine were reportedly issued to the UMEHL, which has reportedly taken 63 mine areas and is scheduled to begin jade production on November 1, 2001.

The mine was said to have been found last December when villagers from Namsi Bum came to the area and dug a fire pit to produce charcoal. After they found jade, other villagers flocked to the area to dig. Soon after, the mining area was closed by military order.

The jade deposits at Hkamti are not a totally new discovery. [back to top]

Oct. 29, 2001: Burma Mid-Year Emporium Results

Burma holds several gem auctions each year. At the at the country’s 10th Mid-Year Gems Emporium, which ran from Oct. 7–14, 2001, Burma fetched a total of US$9.556 million through sale of locally-produced gems, jade, pearls and jewelry under tender and competitive bidding systems. The eight-day state-sponsored gem emporium attracted 302 foreign buyers (mostly from mainland China, Hong Kong, Thailand, Japan and Singapore), and 314 local buyers.

However, the foreign exchange earning of this year’s mid-year gem emporium was 42% less than that gained in last year’s event, due to the slowdown of the global economic growth rate and the September 11 terrorist attacks on the United States.

Since the early 1960’s, according to official statistics Burma has earned approximately US$330 million from its 38 annual and nine mid-year gem emporiums. In September 1995, Burma enacted a new gemstone law allowing private Burmese entrepreneurs to mine, produce, transport and sell finished gemstones and manufactured jewelry at home and abroad (prior to that date, the gem business was restricted to the government and military). Since April 2000, the government has reportedly started mining of gems and jade in joint venture with 10 private companies on a profit-sharing basis. [back to top]

July 23, 2001: Report From Southeast Asia

Richard Hughes, has just returned from Southeast Asia and reports the following:

China
The small Chinese border town of Ruili in Yunnan Province is one of the major transit points for Burmese goods into China. Such goods include legal items, like jewels, and illegal products such as timber, opium and heroin. Richard Hughes found an active gem market in Ruili, with perhaps 500-1000 people daily involved. Most of the trade is in Burmese jade, with only tiny amounts of other gems available. Fine jade was in short supply, with most being of commercial quality.

Cambodia
Three major gem mining areas exist in Cambodia, as follows:

Ratanakiri. Reddish brown zircons which can be heated to produce a blue color are found in Ratanakiri province at two localities. The first and oldest mines are near Bo Kheo. These mines are largely abandoned today. Another deposit has been located in the third district, about 50 km. north of Banlung, the biggest town in the province. This deposit was supposedly discovered by the district supervisor about 3-4 years ago. It had about 2000 people working it at the time of Richard Hughes’ visit, with the gems mined from an alluvial layer about 5-10 meters below the surface. While miners reported that only zircon is found there, older reports on the zircon mines in Ratanakiri suggest that the occasional piece of ruby and sapphire are also unearthed.

Pailin. The historic mining district of Pailin, located in Battambang province near the Thai border, features ruby, blue, green and yellow sapphire, reddish brown zircon and red garnet. Formerly the last bastion of the Khmer Rouge, Richard Hughes found some 5000-10,000 people actively engaged in mining and the allied trades at Pailin. Pailin ruby and sapphire is mainly in sizes of 3 cts. and less. The sapphire generally runs $500/ct. and down, while the ruby, which is identical to the Thai stones from across the border, sells for prices identical to Thai ruby.

Preh Vihear. Yellow sapphires are being mined in Preh Vihear province of northern Cambodia, near the Thai border (probably opposite Si Sa Ket/Ubon Ratchathani). Richard Hughes saw fine faceted pieces in Phnom Penh in sizes up to 2 cts. Some corundum is also found on the Thai side of the border.

Burma

Tachilek/Möng Hsu Ruby. The Thai border at Tachilek/Mae Sai, closed since Feb. 11, 2001, has reopened. This crossing is an important crossing point for gems, particularly Möng Hsu ruby. While rumors continue to circulate that production of Möng Hsu ruby is down, the large quantities (in the tons) of rough available at recent govt. auctions in Rangoon suggest we will not be seeing any shortages soon.

Nanyazeik (Nayazeik). The ruby/red spinel mines at Nanyazeik in Kachin State continue to produce. Mining is taking place less than 1 km north of the village of Nanyazeik, which is located on the Mogaung-Hpakan road in Kachin State. Many of the miners at Nanyazeik have reportedly moved there from the Kadoktut area of Mogok. Kadoktut’s workings, which are part of a long crack in the limestone several kms. in length, were abandoned due to dewatering problems. In Rangoon, Richard Hughes saw a 3-ct + faceted ruby of slightly purplish red color from Nanyazeik, along with faceted red spinels close to 10 cts.

Tanai. In addition to Nanyazeik, another gem deposit is said to exist at Tanai, roughly 33 miles north of Hpakan in Kachin State. Ruby, sapphire, spinel and diamond (yes, diamond!) are said to be found there.

Mogok. Production at Mogok continues to decline. The area remains off-limits to all except a few select foreigners. [back to top]

May 24, 2001: Burma Update

The situation in Burma continues to deteriorate. Rationing of gasoline, electricity and cooking oil is now occurring due to a foreign exchange crisis. In addition, anti-Muslim rioting is spreading to Pegu (80 km. north of Rangoon). This is in part a backlash by the majority Buddhist Burmese against Muslims because of the destruction of Buddhist statues in Afghanistan by the Taliban.

Rumors continue to circulate that the military junta is planning to introduce new 10,000-kyat notes. This is helping to fuel inflation. Introduction of new 500 and 1000 kyat notes in the past caused commodity prices to quickly double. Residents are said to be now transferring their cash into luxury goods (including gems & gold) and real estate as a hedge against future instability.

The Thai border at Tachilek/Mae Sai remains closed. This crossing was in the past an important crossing point for gems, particularly Möng Hsu ruby. It has been closed since Feb. 11, 2001, when fighting broke out between Shan rebels and the Burmese military and their Wa allies. Resettlement of the Wa, who are heavily involved in production and trading of heroin and methamphetamine, has pitted them against the Shans along the Thai border. The Shans, who are ethnically related to the Thais, have traditionally been supported by Thailand in their fight against the Burmese. This move, which was financed by China, served the dual purpose of moving the Wa and their drugs away from China, and adding the problem to the Shans and Thais, traditional enemies of the Burmese. [back to top]

May 18, 2001: Burma Update

Burma’s economy is going from bad to worse. Last Friday the kyat (the Burmese currency) hit a record low of 905 to the dollar, down from 700 a week before. The Thai border with Burma at Mae Sai/Tachilek remains closed and trade is said to be down over 70% from a few months ago. Fighting between the Burmese military and Shan rebels is continuing. In addition, anti-Muslim riots have broken out in Taungoo and Taunggyi and a curfew has been declared in those cities. What does this hold for the gem industry? That’s a tough call. We will continue to watch the situation closely. [back to top]

May 18, 2001: Madagascar Ruby

In what will certainly rank as one of the most important gem discoveries of the year, large quantities of ruby have just been discovered in Madagascar at not one, but two different localities. They are Andilamena and Vatomandry, northeast of Madagascar’s capital city of Antananarivo. According to GK Magazine, tens of millions of dollars worth of this material has entered the important Bangkok market recently, with more on the way daily. We have seen a few pieces of the material, which range from marginal quality all the way to fine Mogok-like reds in sizes up to 3 cts. faceted. We will keep subscribers posted as we learn more about these important new finds. [back to top]

May 3, 2001: World’s largest pearl discovered in Burma

On April 18, 2001, a natural pearl was discovered in the Andaman Sea off Burma’s southern coast. It reportedly weighs 845 carats and was found in an oyster exploration area near Zardetkyi Island. The pearl was discovered by Myanmar Andaman Pearl Co. Ltd., a joint venture firm partly owned by the ruling military, and has been handed over to the state. The Burmese military junta is billing this find as the “world’s largest pearl.” Note that such large specimens are rarely of gem quality, and that enormous nacreous concretions of poor quality have been found on occasion in oysters. We will have to wait for experienced observers to see this latest find before knowing its real value. [back to top]

May 3, 2001: Burma Update

Pala’s Bill Larson has just returned from SE Asia, with both news and fine gems in tow. Burma’s economy continues to implode, with the kyat (the Burmese currency) sliding into oblivion. In Dec. 2000, one US$ fetched 443 kyat. By mid-April, 2001, it had slid to 600 kyat. This week the rate is over 700. Tourism is also in decline, with arrivals falling 9.3 percent in 2000 (compared with 1999). The Thai border with Burma remains closed and trade is said to be down over 70% from a few months ago. Fighting between the Burmese military and Shan rebels is continuing. [back to top]

April 6, 2001: Nanyazeik ruby mines in Kachin State, Burma

Pala’s sources report the Burmese market remains slow. The big action is reportedly at the Nanyazeik ruby mines, which are located in Kachin State in the north. Richard Hughes visited this small village in 1996 and 1997, but there was little activity. Apparently this has changed, with miners from Mogok moving up there to work the deposits. The rubies are said to be a little more blue than Mogok and tend to be quite clear and brilliant. In addition to the ruby, fine spinels are also found there. [back to top]

March 29, 2001: Burma Update

At Burma’s recent gem, jade and pearl emporium, sales totaled US$10.12. This was a 58% drop from the previous year, which had set a record. Such sales have been held annually since 1964, with additional mid-year sales added in 1992. Over the years, sales have totaled US$330 million, according to official statistics. This year, 674 buyers attended. They came mainly from Thailand, Hong Kong and China.

The Burma-Thailand border crossing at Tachilek/Mae Sai remains closed, with fighting continuing between the Burmese army, backed by their Wa allies, and the Shan State Army. Mae Sai is an important trading center for Möng Hsu rubies from Burma. It is also near to major drug trafficking routes, which is said to be the reason for the current fighting. Shan rebels are said to be blocking the Burmese/Wa military from moving their drugs through the area.

Rumors abound in Burma that the government will soon discontinue use of the foreign exchange certificates (FEC’s). Their value has dropped substantially recently. [back to top]

March 29, 2001: Trouble at the Lao Sapphire Mines

The Lao government recently nationalized the sapphire mines just outside the small town of Huay Xai (Huay Sai). These mines had been operated by a foreign company. After accusations of impropriety, the foreign principals of this mine fled to Thailand, while two associates were imprisoned in the Lao capital of Vientiane. Production from the Huay Xai area is deep blue sapphire, mainly in sub-carat sizes. [back to top]

Feb. 16, 2001: Burma Update

The following report has been compiled from Pala sources, along with news sources such as the Bangkok Post, The Nation and the Far Eastern Economic Review:

On Sunday, Feb. 11, 2001, a pitched battle was fought at the Burmese border town of Tachilek, opposite the Thai town of Mae Sai. The battle pitted the Shan State Army against the United Wa State Army and Burmese regular army units. After a number of shells landed on Thai soil, Thai military units retaliated, producing turmoil at the important ruby-trading outpost of Mae Sai and leaving the town deserted.

According to some news reports, this battle resulted from conflicts over drug trafficking routes. The situation came to a boil when the Burmese army occupied a Thai paramilitary base on Feb. 8, reportedly because it was an obstacle to drug caravans. Over the past several years, Thailand has faced an onslaught of methamphetamine from jungle labs operated by Burmese military allies, the United Wa State Army.

The border remains tense, with both sides reinforcing their troops. Just how this might affect the border ruby trade remains to be seen. We suspect that interruption will be minimal. Rubies, like drugs, are easily smuggled and tend to find their way to market no matter what the obstacles.

The Burmese currency is reported to be weak and losing value daily. In late January, the Kyat fetched 430 to the dollar, down from 375 six months ago. Over the past few weeks, it has dropped to near 500. The weakness of the Burmese economy is reported to be at the heart of the military junta’s recent overtures to opposition leader, Aung San Suu Gyi. Western sanctions against the military regime are also said to be biting deep, cutting potential foreign investment and aid. Coupled with the deteriorating economy, the situation is not good.

Huge Jade Boulder. A large jadeite dike has just been discovered in Burma. This piece measures 70 feet in length by 20 feet high by 16 feet deep. It was found in the Hpakan area of Upper Burma’s jade tract. [back to top]

2000 Gem News Archive

Oct. 27, 2000: Gem News from Madagascar

We have an update from one of our Madagascar correspondents. Over the past several months, there have been raids against illegal traders in Ilakaka. Traders have been fined and expelled for visa and currency violations. These raids were not directed against any one specific nationality, but against all foreign gem traders who were violating the law. One result was a significant drop in market prices (30–40%), because with fewer buyers, competition was reduced. On the other hand, the quantity of stones exported legally also increased significantly. The feeling of the Madagascar government is that you need a strong hand and very good economic incentives to change the mainly illegal business into a legal one where the producers as well as the country will gain something from these not renewable resources. [back to top]

Oct. 13, 2000: Gem News from Thailand

Richard Hughes visited Thailand’s Chanthaburi gem market a week ago and found business to be very slow. The origin of the few fine sapphires seen in Chanthaburi was Madagascar, while a few smaller Möng Hsu rubies were also on offer, but generally the pickings were slim. The only Nigerian spessartine and rubellite seen were of low quality, confirming that these deposits are largely worked out. Pala International still has a fine stock of these gems. Get them while you can.

Hughes visited one small mechanized mine in the Khao Ploi Waen/Ban Kha Cha area near Chanthaburi, producing yellow, blue and black star sapphires. Two other similar mines operated nearby. Mining for blue sapphire continues also at Bo Ploi in Kanchanaburi province, but is greatly diminished from years’ past. Some mining is also taking place in the Pailin area of Cambodia. Bangkok’s gem and jewelry show moved to much larger premises. Richard Hughes attended one afternoon and reported generally slow attendance, perhaps because the show is now so much larger. [back to top]

Oct. 13, 2000: Gem News from Burma

Pala President, Bill Larson, found little new production in Burma during his recent trip to Rangoon. Spinels were in short supply. The government-sponsored auctions remain dominated by local dealers paying extremely high prices in local currency. With the political situation in Burma remaining extremely unstable, it appears that Burmese gems will continue to remain scarce. [back to top]

Oct. 13, 2000: Gem News from Madagascar

The Madagascar government recently staged a crackdown on foreign gem dealers for visa and currency violations at the important Ilakaka sapphire mines. Many Thai, Indian and Sri Lankan dealers were arrested, with huge fines reported for some of the worst violators. Just how this might affect supplies remains to be seen. [back to top]

Sept. 7, 2000: Russian Jadeite

In August, Richard Hughes and Nickolai Kuznetsov completed an epic journey to two different jadeite deposits in Russia, one in the Polar Urals and another in Khakassia. Look for their account in the Nov.–Dec. issue of GemKey Magazine and here at Palagems.com. [back to top]

April 19, 2000: Burma Gem News

Pala President, Bill Larson, has just returned from Bangkok and Burma and reports that Mogok sapphires continue to be in short supply. But the big news was the shortage of top quality red spinels from Burma. The best pieces are currently being snapped up by Swiss buyers who appreciate the fact that fine red spinel comes from only one mining area in the world (Mogok, Burma) and is one of the few gems today that is untreated. Burma’s economy continues to sputter and choke, being heavily affected by the Asian economic crisis and continuing military rule. But the Thai economy is showing good signs of recovery. [back to top]

April 19, 2000: Bangkok Gem News

In Bangkok, availability of Madagascar pink sapphire is beginning to tighten. This material comes out of the ground purple and is heated to pink. Pala picked up a number of fine pieces in the 1–4 ct. range. Tanzanian tsavorite production is also beginning to decline. These stones approach emerald in color. Pala now has a nice assortment of these pieces in sizes up to 4.3 carats. [back to top]

March 22, 2000: Burma Update

In our last message, we reported on a shortage of Mogok (Burma) sapphires. This appears to be part of a general shortage of Burmese gems, due to both a crackdown by Burmese troops along the Thai border and an explosion-cum-revolt at the important Shan State ruby mines at Möng Hsu. Predicting the future is always difficult, but in light of this information, future shortages of Möng Hsu ruby would not come as a surprise to us. Pala president Bill Larson will be making a trip to Bangkok and Burma in April and will bring back more news at that time. [back to top]

March 3, 2000: News from Bangkok

One of our sources in Bangkok has just informed us that Mogok (Burma) sapphires are becoming increasingly scarce, but Sri Lankan and Madagascar material is still available. [back to top]

Note: Palagems.com selects much of its material in the interest of fostering a stimulating discourse on the topics of gems, gemology, and the gemstone industry. Therefore the opinions expressed here are not necessarily those held by the proprietors of Palagems.com. We welcome your feedback.