Gail Howard's Gem Trade Adventures in Ceylon (Sri Lanka) in 1965 and 1966
While Pornsit and I were discussing the prices he would pay me for specific quality sapphires, a gem-buyer friend of his walked into Beauty Gems. Pornsit introduced Leon Mason from Los Angeles, and told Leon I was leaving that day for Ceylon to buy gemstones. The Mason family has been in the gem business for generations.
Leon and I sat together on the flight to Colombo and hit it off immediately. Two of Leon's friends met us at the airport with a chauffeured car. Although both were young - Fiaz Salie was 21 and Rafi Joonoos was 22 - both were experienced gem dealers. And both were members of the extended Muslim clan that controlled the gem trade in Ceylon.
When Fiaz was eight years old, his grandfather would lay out ten red stones (ruby, garnet, spinel, rubellite, etc.) and tell Fiaz that he was going out for one hour. When he returned, Fiaz had to accurately identify the stones. If he made a mistake, he got a beating. Thus was Fiaz trained in gems.
The next two weeks were packed with appointments. Mornings Leon and I usually went to the spacious mansion of Idroos Noordeen. Barefoot dealers from the mines lined up on the front patio to show their wares.
Dressed in dhotis, loose fitting white gauzy cotton garments, these impoverished-looking natives would pull out gems often worth thousands of dollars from various tucks and folds in their garments. A square of torn white muslin would be carefully untied to reveal a beautiful valuable gemstone.
At first, they showed us only junk. As we rejected lot after lot of inferior stones, better stones emerged from the hidden folds of their garments. Only after several days did they show us valuable gemstones.
Idroos, Fiaz and Rafi cautioned me repeatedly to be patient and to wait. Fortunately, they had warned me not to show the slightest emotion. Otherwise, I would have erupted in anger at the outrageous prices. With a perfectly straight face and no sense of shame, a seller might quote a price a thousand percent above what it should be. From there, everything was up to the buyer. One could never judge the value of a stone by the asking price.
As a theoretical example, let's say a stone should be bought for $10 a carat. The barefoot scoundrel in his white dhoti would have the nerve to ask $125 per carat.
I would offer, "Two dollars a carat."
He'd laugh. "Impossible."
"What is your best price?"
"$120 a carat."
"My top price is $8. Take it or leave it."
"Impossible," he'd say,
I'd return the stone to him and go on to the next dealer.
Since in this theoretical example, $8 a carat was near the actual selling price, the seller would see that I was a potential customer. But a deal would never be struck on the same day.
A few days later, he would tell me I could have the stone for $15 a carat - quite a drop from $125. From there I would haggle it down to $10 a carat or pass on it. That is a simplified example of the complex way gems were bought and sold in Ceylon.
Price also depended on the mood of the seller, the other offers he had received, how much he had to pay for the crude uncut stone, and how badly he needed money.
A dealer might pay a high price for a promising hunk of uncut rock, but when cut and polished, it turns out to be a mistake. In that case, he tries to get as much money as possible to recover his loss. Or a stone might come out better than expected and can be sold for less. It is a highly speculative business for dealers.