(“Teodora,” the world’s largest cut emerald (at 57,500 carats), was mined in Brazil, cut in India)
Brazil began to exploit its emerald deposits in the early 1970s. Although not quite of the same high standard as their erstwhile Colombian cousins, the Brazilian stones have none the less carved out a significant mid market niche. Steady production continues from the Itabira / Nova Era belt in the principle gem mining state of Minas Gerais. There have however been significant challenges to the emerald industry in Brazil along the way, not least from the strict environmental regulations and rapidly increasing wage bills over recent years. There have also been significant disagreements between the major land owners and there are ongoing disputes between the major industrial interests and those of the small independent miners, known as garimpeiros. Furthermore, the broader economic difficulties of the country coupled with currency fluctuations between the Real and the US dollar have created a further drag on the progress of this sector of the economy.
Belmont, Minas Gerais
One of the first mines to open was the Belmont, Minas Gerais in 1978. The site was, and still is, also used as a cattle ranch on which the owner’s grandfather discovered emeralds by accident. Up until 1998 it was operated as an open pit mine at which time a 75 metre vertical shaft was sunk, enabling the opening of side tunnels using picks, shovels and explosives, removing the schist up the main shaft. However 50% of production continues to come from open cast to this day and they believe a good many more emeralds may well be produced by this method. Since 2004 the site has been significantly expanded to allow large vehicles to get onto the site and into the underground workings and optical sorting has replaced hand picking. Belmont recovers over 250,000 grams of rough emerald per year from 350,000 tonnes of soil, containing 70,000 tonnes of ore, which equates to 1 gram of emerald per 280 KG of processed ore. The nearby town of Itabira contains the sorting facility and 80% of the rough sold by Belmont is subsequently cut and polished in India. One hindrance to gem mining in Brazil is the fact that the land owner is entitled to a percentage of the production by law, even when another party owns the mining rights and licence. Every time the price of emeralds increases by 30% the mine’s life expectancy doubles so at current estimates the site is likely to remain in operation through to 2045.
Capoeirana, Minas Gerais
Emeralds were unearthed at this site in 1988 and ever since the majority of production has been carried out by small scale, independent miners and much of the work is conducted by hand. By 2009 it was reported that the Capoeirana mines were struggling because the shafts were exceeding 100 metres and the hard rock was becoming too difficult to work with ladders and hand tools. Furthermore the obvious health and safety issues were mounting, including the heightened risk of cave-ins due to the close proximity of poorly propped walls between underground workings. At the same time the global financial crisis, coupled with the rise in the Brazilian real against the US dollar, made it hard for the small producers to get by and many moved to other mining areas or returned to agriculture. Some merger and acquisition did take place and firms such as Belmont began to modernise many of these properties in order to make them more efficient. Mining at Capoeirana is done by way of a complicated cooperative system in which miners must be part of the cooperative. The Montebello mine is one of the few mechanised operations in the Capoeriana and its processing is the most sophisticated in the region. More recently some larger (10-20 carat) stones have been unearthed in this area and it is thought that 20-30KG per month of facet-grade material, including 1-2 KG of fine-quality rough, is now being produced.
(Much of this back breaking work is still done by hand)
Bahia and Santa Terezinha De Goiás
Bahia produces 500-1,000 KG of rough emerald per month. However the quality is normally inferior to that of Itabira / Nova Era. Despite occasional fine-quality finds, for the most parts the emeralds from this area are highly included and most of the mining work is done by garimpeiros in the Carnaiba and Socotó districts. Santa Terezinha in Goiás State was a major mining centre from the 1970s to the 1990s, after which production tailed off significantly. The area was largely a victim of its own success due to the fact that most of the emeralds were found by mining the deposit in a straight line because they were fairly evenly distributed, enabling rapid exploitation and subsequent exhaustion of the reserves.
Brazil’s emerald output is divided between sales to domestic cutters and polishers and foreign buyers, who take the rough back to their cutting centres and a significant number end up in Jaipur, India, at plants that can deal with almost any size or quality of stone with ease. This enables them to capitalise upon the economies of scale and their labour costs are significantly lower than their Brazilian counterparts, who must in turn rely upon the higher value stones in order to cover their greater overheads and this has become their market niche. It is clear that there are enormous challenges facing the Brazilian emerald industry, not least from the growing appetite for tighter environmental and safety regulations which have the effect of increasing production costs. Coupled with this wage costs are increasing, necessitating greater investment in new technology, much of which is unproven. However, further up the value chain emerald prices are steadily rising and although Colombia has built a firm reputation as the leading producer of high end emeralds, Brazil is definitely in a position to carve a niche as a leading player in the mid market segment of the global emerald industry.