From the emerald-adorned palace of Cleopatra to the imaginary Emerald City of Oz, these green gems have fascinated humankind for millennia. In antiquity, they were believed to confer riches and power, and even predict the future. A member of the beryl family, emerald evokes the growth of spring with its lush color — perfect for a May birthstone.
The first known emerald mines date back to 330 BCE in Egypt, though the gems were in use much earlier in the Middle East and South America. Today, emeralds are found in many countries, with most production coming from Colombia, Zambia and Brazil. There are also commercial mining operations in Afghanistan, Ethiopia, Pakistan and Madagascar. Here, we look at some of the responsible sourcing initiatives for emeralds from Colombia, Zambia, Brazil and Afghanistan.
Colombia: A national treasure
About 20% to 25% of the world’s emeralds originate in Colombia, yet they represent nearly 50% by value, given the 20% to 30% premium they command. The deposits are in two main areas of central Colombia, each created during a different period in geological history. As a result, gems from each zone exhibit different mineralization types and slightly different colors. The eastern zone includes the mines of Chivor, Gachalá and Macanal, while the western area features the Muzo, Coscuez, La Pita and Cunas mines.
“Stones from the eastern zone are more bluish-green in tone, while those from Coscuez, La Pita and Cunas have a more yellowish tint,” explains Guillermo Galvis, president of the Colombian Exporters Association. “Muzo balances all the hues together.”
Emerald mining in Colombia has undergone major changes over the last 15 years. Leaving its tumultuous past behind, the industry has become a model of responsible sourcing. As Edwin Molina, president of the Colombian Emerald Producers Association, says, “we believe emeralds should really be green — from every point of view.”
In 2015, the government passed regulations to bring transparency and fairness to the industry for miners, dealers and exporters. “Working with the government, the National Emerald Federation collects 1% of the value of all stones exported. These royalties are used for social programs, research, education and healthcare initiatives in the emerald-producing regions,” explains Galvis, adding that “85% of emeralds are exported. Most go to China, Hong Kong and India, with others going to the USA and Europe.”
While some artisanal mining exists, most of the mining activity is by large companies with their own corporate social responsibility (CSR) initiatives. Among them is Dubai-based Fura Gems. In 2018, it acquired a 76% stake in the 400-year-old Coscuez mine and put social initiatives in place not only for miners — who receive salaries, healthcare and benefits in line with Colombian legislation — but also for the local community. Since a third of families in the area depend on the income of women, Fura created a women-only facility to wash the ore. Other initiatives include support for 70 small businesses, including a bakery, carpentry workshop and sewing center.
Zambia: The world’s largest producer
Emeralds were discovered in Zambia’s Kafubu area in 1928, and the country has since become the most prolific emerald producer in the world. In between, its mining industry went through multiple stages of regulation, privatization and other management hurdles on the road to transparency.
In 1966, the mining claim for Kafubu went to a private company, but passed to the government in 1971 following nationalization of key sectors of the economy. Production expanded rapidly during the 1970s, but the realization of emerald’s economic potential — along with widespread illegal mining — led the government to create a restricted zone for authorized mining activity.
Following privatization in the early 1990s, the government issued some 400 mining licenses. Operations during the next 15 years were shrouded in mystery, and the government received almost no taxes on emerald sales.
That all changed in 2008, when Gemfields acquired 75% of Kagem Mining (the remaining 25% belongs to the Zambian government). As a listed company with reported production and financial data, the industrial miner lifted the shroud from the emerald sector, making it possible to create benchmarks and collect taxes.
“Kagem is believed to be the world’s single largest emerald mine, [based on] data obtained from the United States Geological Survey (USGS), which indicates that Zambia has accounted for more than 70% of global emerald production since 2010,” says Emily Dungey, Gemfields’ director of group marketing and communications. “We can also deduce that Kagem accounts for at least 50% of Zambian production.”
After a pandemic-forced closure from March 2020 to April 2021, Gemfields is now back in production. The miner distributes its gems through periodic auctions, and the latest “yielded the highest revenue since March 2016,” Dungey reports.
“We believe that paying a fair, dependable wage to local employees, constantly evolving and improving our practices, transparently disclosing and paying taxes to host nations, and leaving a legacy of community and conservation projects are actions that speak louder than words,” she continues. To that end, Gemfields launched the Gemfields Foundation in January. The organization is involved in building schools, clinics and farming cooperatives to provide long-term sustainable incomes in the community, as well as conservation of wildlife. Dungey serves as the foundation’s managing director.
Although the Kagem mine is the largest single producer, a government-mandated concession area allows 430 artisanal and small-scale miners (ASM) to operate.
“In mining for emeralds, the difficulties are significant, with the biggest challenge [being] finding investors to provide equipment,” says Susan Wheeler of Virtu Gem. The nonprofit platform partners with mining associations to offer members a conduit for selling gems at a fair price to international markets. Virtu Gem places a 20% premium on the cost of the stones, which then goes back to the mining association for local assistance programs.
When mining stopped during Covid-19, Virtu Gem supported food drives, personal protective equipment (PPE), and other help for the mining communities. “When it comes to responsible sourcing for ASM, what is responsible for us is seeing them wear hardhats,” says Wheeler. “What is responsible for them is being able to feed themselves.”
Brazil: Luscious color
Brazil is the third-largest emerald producer, after Zambia and Colombia. The first discoveries were in 1913, and commercial mining began in 1963. Then, in 1978, a chance unearthing of several green stones during the digging of a watering hole began the saga of the nation’s most important large-scale mine. Now in its third generation, the Belmont mine in Minas Gerais has grown from an open pit to a large underground operation, using the latest geological surveys and cutting-edge technology.
“Brazilian emeralds are similar in color to the stones from Zambia, without the strong bluish hue. They are usually pure green,” says Marcelo Ribeiro, who runs the site.
Belmont is vertically integrated, running from mine to market. “Each phase of the process — from extraction to cutting to distribution — adheres to the highest standard of quality control, which gives the market confidence of the no-conflict origin,” he explains.
He is just as serious when it comes to social and environmental responsibility. Through systemic recuperation of the degraded mining areas and strict control of effluents, the mining causes virtually no long-term destruction of the surrounding environment.
Belmont held an emerald auction in March and will have another in September in Dubai. “Our main customers are gem cutters from India, Israel and China, with some buyers from the USA and Germany,” says Ribeiro.
Afghanistan: Cooperative effort
Emerald mining in Afghanistan goes back millennia, with deposits in the Panjshir Valley of the Hindu Kush Mountains, about 113 kilometers northeast of Kabul. The bluish-green color and inclusions of Afghan emeralds are similar to those of Colombian emeralds. Since 2001, international interest has brought excavators to the area, though ASM methods are still used inside the tunnels. The local miners have permission from their village elders and officials to operate their mines. However, the current government claims to own the mining area.
“Production has increased by a large percentage over the last year, with many crystals over 100 carats,” says Gary Bowersox, president of Gem Hunters Corp. He is actively working with the miners, the country’s Ministry of Mines and the United States Agency for International Development (USAID) on projects to bring responsibly sourced emeralds to market.
“We will have over $40 million of rough emerald for sale at our conference on November 1 to 3 in Dubai,” he relates, adding that the “primary markets for Afghan emeralds are India, Israel and the USA.”
Article from the Rapaport Magazine - August 2021. To subscribe click here.