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“Sun stone” - Russia’s treasure

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Amber has attracted people's attention for many centuries. They made amulets, jewelry from it, decorated the interior with it and used it for medicinal purposes. Now this “sun stone” is gaining momentum and the amber industry is booming. Let's take a closer look at the prospects of this area in Russia in comparison with other “amber” countries.

The Kaliningrad region contains 90% of the world's amber reserves, and the main developer of amber deposits is the Kaliningrad Amber Combine. The media are full of news that the plant continues to extract large pieces of amber.

Recently the workers of the plant found a 2.5 kg amber stone following the extraction of a stone weighing 12 kg. In honor of the Day of Russia this “sun stone” was named the “Soul of Russia”, as reported by the press service of the enterprise. The rounded stone found by the workers of the Primorsky quarry has a light honey color. Amber stones weighing more than 2 kg are very rare, therefore they are highly valued on the amber market.

First, let's figure out what amber is

Amber is a tree resin. The average age of such fossilized resin is 40-50 million years. Due to its chemical properties amber is highly valued not only in the jewelry industry, but also in medicine and industry, for example, as a varnish or electrical insulator.

If we look into chemistry, amber is a hydrocarbon - a combination of carbon, hydrogen and oxygen. The color and other properties of the stone depend on many factors, for example, the conditions for the formation of the resin. It also differs depending on the deposits.

For example, Baltic amber contains from 3 to 8 mass percent of succinic acid. This made it possible to distinguish Baltic amber into a separate group of fossil resins called “succinites”.

According to estimates, the world resource potential of amber (including proven reserves and resources) is more than 1 million tons.

Is this stone really in demand

The Kaliningrad Amber Combine, controlled by Rostec and developing the amber deposit in the Kaliningrad Region, is one of the largest players on the amber market. It accounts for 65% of the extraction and industrial processing of amber, which is supplied to the world market. In 2020 the plant produced a record 525 tons of the mineral. This year the company intends to keep production at the same level. The extraction of the yellow stone is largely determined by demand. And it is growing.

According to Mikhail Zatsepin, General Director of the Kaliningrad Amber Combine, JSC, small fractions of amber are especially popular at the moment. This is due to the fact that many jewelry manufacturers have learned to “process it into jewelry and souvenirs”. In this regard for the first time in several years the plant's warehouses were emptied by 70%, Interfax said.

According to TASS, the Kaliningrad Combine sells 69% of its products on the regional domestic market. About 22% of raw materials are supplied to other regions of Russia, and the rest of the products are exported to Belarus, China, France, Japan, Spain, Italy and Germany.

The processing of raw materials creates added value in the price of finished amber products.

This accordingly contributes to the growth of demand for raw amber. The processed stones are then used by jewelers, as well as in furniture production, production of household and decorative items.

According to the Strategy for the Development of the Amber Industry of the Russian Federation until 2025, as of 2014 the fossil resin accounts for a total of 1.74 billion US dollars in the world amber jewellery market with the greatest demand for these goods in India, China, Japan and the member states of the European Union.

Where is else amber mined?

Besides the Primorsky quarry in the Kaliningrad region, there are other locations where amber is mined. It is found in small volumes in the USA, Canada, Mexico, Romania and the Dominican Republic, Belarus. In addition, there are also three amber deposits in Ukraine.

The largest reserves of high-quality amber suitable for the production of jewelry are in Russia (37.5 thousand tons), Poland (12 thousand tons) and Belarus (6.7 thousand tons).

The amber reserves in the Kaliningrad region are localized in relatively compact deposits, while the amber reserves in Poland and Ukraine are distributed over an area of several thousand square kilometers.

Thus, Russia has natural competitive advantages in the world market for raw amber. The reserves of this fossil resin in the Kaliningrad region are relatively shallow and well localized.

Perhaps the second largest amber mine is the Dominican deposit with the deposits of blue amber with a production volume of no more than 50 kg per year.

In the Rivne region, Ukraine, there is also an amber deposit - near the villages of Sarny, Klesovo and Dubrovitsy. Due to the fact that amber deposits are close to the surface of the earth (3-10 meters) the extraction is much cheaper. Despite this, the market price does not change in any way since amber is mined in small quantities.

Recently, Concorde Capital reported that “Sonyachne Crafts” LLC (part of Concorde Capital) has started mining raw amber at its deposit near the village of Vladimir (Rivne region).

It should be noted that Ukraine ranks second in the world in terms of amber reserves. At the same time, the country officially produces about four tons annually, which is approximately 5% of the actual production of amber in Ukraine.

The Burma field is located in Myanmar, in the Kachin state. The volume of extraction of fossil resins is about 500 kg per year.

The Mexican mine in Chiapas is also one of the main amber mining sites. It produces about 4 tons of amber per year.

Benefication of the “sun stone”

According to the Strategy for the Development of the Amber Industry of the Russian Federation for the Period up to 2025, as of 2016, Poland was the world leader in the processing and manufacture of amber products. Thus, this country accounted for about 70 percent of the world volume of jewelry with amber.

Historically, Polish jewelers specialized in making amber jewelry and bijouterie. Therefore, this stone has acquired a key position in the Polish jewelry industry.

In addition, the jewelry production of amber in Poland exists with an effective policy of state support for this area, which contributed to the development of an amber industrial and tourist cluster in this region.

For example, in Gdansk, more than 100 tons of amber are processed annually, and products with amber account for 90 percent of the turnover of jewelry firms in this region.

Now in Poland there are about 1.5 thousand private small and medium-sized enterprises, providing employment for more than 7 thousand people.

Lithuania is also a major center for the processing of amber into jewelry. Lithuanian amber products are more export oriented. This country is Poland's main competitor in the world of amber market. Lithuania uses raw materials mined on the territory of the Republic of Lithuania itself, and also uses imported stones mined in Russia, Ukraine or Poland.

According to expert estimates, in 2016 Lithuanian manufacturers accounted for about 18 percent of the global amber jewelry market.

However, we shouldn't forget about the smuggling that fuels this market. Thus, according to experts in amber processing, Lithuania receives a significant amount of raw amber through smuggling from the Kaliningrad region and Ukraine.

Lithuania also uses raw amber for re-export. In particular, the amber obtained from Russia is re-exported by Lithuanian enterprises.

The center of amber production in Russia is the Kaliningrad region, processing 30 tons of raw material per year. In addition, other amber processing plants buy another 50 tons per year.

A part of the amber mined at the Kaliningrad Combine is processed at the JSC Yantarny Yuvelirprom, which was finally attached to the Combine on July 1, 2020. Now all the goods are produced under the single brand “Kaliningrad Amber Combine”. According to the general director of the plant, Mikhail Zatsepin, about 30 tons of amber are processed at the plant. The company's revenue at the end of 2020 amounted to 238 million rubles. At the same time, the plant intends to reach a revenue of 600 million rubles. To increase competitiveness and capacity the plant invites craftsmen from Kostroma, Yekaterinburg, Yakutia. They are the ones who specialize in bone and stone processing.

The development of the amber industry also contributes to an increase in jobs. Thus, last year the company employed 50 people, now more than 150 people are employed in the jewelry production. The company plans to increase the number of hired workers to 300 people.

Also, to pump up its capacity, the enterprise is carrying out the reconstruction and modernization of premises with an area of 5 thousand square meters.

Nevertheless, despite record levels of amber production and large jewelry factories, the Russian Federation does not fully involve the cultural side of amber to promote finished products.

If the so-called “amber tourism” is flourishing in Lithuania and Poland, which draws public attention to the value of amber, in Russia this direction is just beginning to develop. Today the amber plant arranges special excursions to the production and attracts marketers to promote jewelry with amber. However, amber factories in Russia lack government support to enable the amber jewelry industry to reach its full potential.

Victoria Quiri for Rough&Polished