Rubies are perhaps the crown jewel in Myanmar’s resource riches. The
country’s one of the biggest sources of the red gems in the world.
Demand for the stones has taken off in recent years, especially from
China. The price per karat has soared, jumping about 10% a year since
2010.
But since Myanmar’s recent opening up of trade and investment, the
ruby business remains one of the murkiest sectors in the country’s
economy. Some human rights groups allege poor conditions at ruby mines,
and close links between the mines and the country’s former military
rules. The U.S. government has barred the import of rubies from Myanmar
for a decade.
Whither Myanmar’s ruby industry? The Wall Street Journal’s Duncan
Mavin recently spoke to Miemie Tin Htut, owner of Bangkok-based Silken
East Co., a major supplier of rubies and other gems to large
international jewelry retailers.
WSJ: What’s your role in the industry?
Ms. Tin-Htut: My family company has a gem-stone cutting facility. We
buy rough gemstones from a dozen to twenty middlemen and cut them to
sell to dealers, mostly in the Far East or the U.S. I sell to less than
20 buyers. [Major Chinese jewelry retailer] Chow Tai Fook is one of my
biggest buyers.
How long has your family been in the industry?
Many generations. The grandfather of my grandmother started it.
Personally, I’ve been in the gem business for 20 years. Our ancestors
owned mines, though the family doesn’t own mines any more. In Mogok [the
center of Myanmar's ruby mining industry in the northeast of the
country], there’s a saying that “only foolish people own mines.” It’s
too expensive because you have to invest a lot with no guarantee that
you will find anything.
You trade only Burmese rubies?
In the past few years, the supply from Burma has diminished a lot. So
I now have to buy from Africa. Mozambique. I don’t know how many more
years we’ll have supply of rubies from Burma. Ten years ago, I thought
it was endless supply and all you need is money. In the last two to
three years, the demand, especially from China, has picked up
dramatically.
What’s happening to supply?
A decade ago, I took my 90-year-old aunt to Mogok and showed her some
stones. She asked, “Do you really have to pay for these stones?” When
she was young, there were so many rubies that only the best were
valuable. When I was a teenager, my parents would send us to Mogok
sometimes. Then, you could see red crystals all over the road. It was
the “off cuts,” we called them “the angels’ cut.” Nobody bothered to
pick them up. But there’s nothing on the roadside anymore. In the next
50 years, you’ll probably have to draw a picture to show people what a
ruby is.
How big is your business?
We have $3 million to $4 million a year in turnover. We sell less
than 100 rubies a year. We’re probably in the top 10 biggest dealers.
Do you think the industry will address ethical concerns? What is the impact of U.S. sanctions?
Nobody really cares. We don’t need Americans.
There’s falling supply and the real buyers are in China. Besides, the
generals are not hurt by the sanctions anyway. It mostly hurts small
traders. There’s not enough supply and trade to make it worthwhile to
introduce widespread ethical standards and testing like you have for
diamonds.
Who pays the most for rubies?
The Burmese. They pay the highest price in the world because they know the rarity.
How do you trade rubies, given restrictions on exports?
Exports are not freely permitted, but there are channels for getting rubies out. They find their way out.
source: The Wall Street Journal
No comments:
Post a Comment