The Price of Turquoise

Determining a price for natural turquoise is difficult. Most turquoise is very chalky and requires the injection of plastic polymers in order to stabilize the turquoise for hardness and color so that it may be used in jewelry made for the mass market. The natural turquoise market, comprising at most twenty percent of all turquoise and often far less, presents a challenge for determining a market price precisely because the natural turquoise market is so thinly traded, meaning there is not a lot of natural turquoise available.

The challenge in pricing natural turquoise is compounded by the fact that in the perhaps twenty percent of natural turquoise only as little as five percent may be considered high grade and the highest grade, which I call gem grade, comprises as little as one tenth of one percent of all turquoise. That’s rare. Even more perplexing is that within that rare gem grade there are even higher grades of ultra-gem grade consisting of the rarest gem stones on the planet.

It’s difficult to understand how very rare the highest grades of turquoise really are. An example may prove rewarding. Candelaria is a turquoise that never came from a turquoise claim. It comes from the dumps of the Candelaria silver mine and has been obtained only from trespass and illegal high grading of the turquoise. There has never been much Candelaria turquoise available. The only legal mining was in 1985 when Wayne Nelson obtained a concession to work the dumps from NERCO mining company. That was a short-lived concession. If we look at the turquoise that Wayne mined during that year, with impeccable provenance, we may see how even the highest grades of Candelaria vary by grade and rarity.

We all learned in Econ 101 that price, in a free market, is determined by supply and demand and the interaction of a willing seller and buyer. While most commodities sell solely on price, turquoise is unique in that there is a two-tier market with most turquoise, as much, or more, as 80%, requiring some form of treatment in order to be used in jewelry and selling for much less than the rare natural. Very pretty stabilized turquoise may be purchased for a dollar a carat or less. With natural turquoise price escalates greatly as grade increases. While high grade is often considered as the top 5% of all turquoise, the highest grades may comprise as little as 1% with the elusive gem grade consisting of as little as 0.1%, one tenth of one percent of all turquoise, or less. Prices rise on a geometric scale with the highest grades selling at a premium of several hundred percent compared to the treated turquoise commonly found in mass produced jewelry.

In the photo we see some examples of the highest grade of Candelaria, seldom found in the market. Starting on the left and moving to the right the weights are 1.= 65.3 carats, 2.= 75.5 carats, 3.= 66.5 carats, 4.= 22.7 carats and, on the far right, 5.= 53.9 carats. These would be considered large cabochons, especially at these grades and the larger cabs increase the rarity.. For the sake of this exercise, I will provide a more conservative price estimate. Actual market price is difficult to determine since Candelaria of this grade is seldom found and price comparisons are not available. The important part of this comparison is to see how greatly price increases by grade even at the highest levels.

One, $20/carat ($1300). Two, $40/carat ($3,000), Three, $150/carat ($9,900), Four, $300/carat ($6,900) and Five $600/carat ($32,000). Mind blowing, isn’t it? These are estimated values based upon rarity and cost of production. The Candelaria silver mine is under leach development and the existing dumps will soon be lost forever. Whatever Candelaria that makes its way to market will likely come from existing collections. Second, the last three cabs are examples of Candelaria exceedingly rare with the final dark web part of only 187 carats cut by Wayne Nelson. Calculating the rarity of this turquoise becomes astronomical.

Still, there is no price until there is a willing buyer and seller and the point is moot as turquoise of this grade is seldom available. With such thin float (the product available for sale in the market at any given time) small increases in demand may result in dramatic increase in price. Let us remember that in 1905 the average price for high grade turquoise was $15 a carat or about $450 in today’s price with the highest grades selling for $25 a carat or almost $800 today. Comparing prices from the early period and today is a bit of an apples and oranges comparison. There was no stabilized turquoise since plastic polymers had not been invented. Today stabilized and enhanced turquoise dominates the commercial market with little natural turquoise available except at middle grade. This tends to distort pricing between treated and natural turquoise on a relative basis since price is a factor of the marketplace while value is determined more by cost of production.

If we assume that the same relation between the turquoise that requires some hardening before it may be used in jewelry and what does not remains at about 80% to 20%, than not only was 80% of turquoise mined during the early period left in the dumps as unusable, but of the remaining 20% only the rare clear sky blue was used making the clear sky blue very rare and costly. This may be seen in the pricing of matrix turquoise in 1905 at $0.25 to $1 a carat ($8- $32 in todays price) compared to clear turquoise selling for between $6 and $25 a carat with a median price of $15, over $400 a carat in today's price. Today nice medium to high medium grade natural may be found at between $3 and $10 a carat.

By these standards the price for mid to high mid grade natural turquoise is very undervalued and for natural turquoise at the highest grades does not seem unreasonable.

Mike Ryan II

Santa Fe

September 2022