Burma has long been the world’s biggest producer of jade and high quality gemstones. The vast majority coming from the small mining town of Hpakant, in the northern region Kachin Mountains. Chinese dealers buy up much of the jade and locals smuggle it across the border due to the fact that foreigners are not allowed in the town.
Over the past decade Chinese consumer spending has increased considerably and jade prices have kept pace with this trend. However recent fears over a shortage of Burmese jade due to export restrictions are alarming the markets. Also the fear that bigger mining companies who have access to modern mining technology and machinery are expected to replace current labour-intensive forms of mining which could deplete the mines stocks much quicker than the old traditional methods.
The Chinese have always had a great passion for jade and although much of Burma’s raw jade goes into mainland China, a great deal of it eventually ends up in the Hong Kong jewellery stores. A big Hong Kong jade trader commented on an industry website recently that he is having difficulty in sourcing Burmese raw jade.
A report shows that just several years ago a piece of Burmese jade purchased at trade fairs in Guangdong, southern China, for around US$2,700 and then processed into jewellery would then sell for approximately ten times the price of the original raw stone. In Hong Kong and Macau demand is now falling due to the fact that mainland traders are struggling to acquire raw jade and having to charge higher prices.
At one time raw stones that were priced at US$1,600 are now being sold for at least US$2,400.
Myanmar’s Ministry of Commerce (MMOC) trade data provided shows that in 2011/2012 jade was the country’s second-biggest source of revenue and was valued at US$780 million. A 2013 report from Harvard University completely contradicts the MMOC report and puts the value of Burmese jade sales as high as $8 billion in 2011/2012. The huge difference in the figures of the two reports is undoubtedly due to the fact that most of the jade leaving the country into China is unregulated or not documented correctly. Jade mining companies that sell their products through legal channels are subject to high government taxes up to 30 percent of the sale value. Hence the vast amount of illegal smuggling that occurs.