Illegally mining Russia’s ‘Baltic gold’

Booming global trade in 50-million-year-old amber stones is lucrative, controversial, and extremely dangerous.

Kaliningrad, Russia – From a distance, it looks like Alexander is operating a makeshift vacuum cleaner desperately trying to grope for something precious at the bottom of a small, muddy pool that he and his mates – known here as “black diggers” – dug up days earlier.

Clad in swamp boots and dirt-stained khakis, the blue-eyed 23-year-old stands knee-deep in chilling water with a long aluminium pipe connected to a rattling pump. The pipe spews out pressurised water that washes away a layer of “blue earth”, 50-million-year-old sediment that contains pieces of amber – fossilised tree resin that sometimes costs more than its weight in gold.

Prized for its translucent texture that seems sunlit from inside, amber has for millennia been used throughout the world to make jewellery, medical drugs, perfume and religious artifacts. Green-and-blue amber is found in the Caribbean, ruby-red and purple kinds come from Myanmar and Sicily. But amber of some 250 hues – from milky-white to yellow to black – is only mined in the Kaliningrad region, Russia’s Baltic Sea enclave, 1,200km west of Moscow.

Wedged between Poland and Lithuania, Kaliningrad is the source of at least 90 percent of the world’s deposits of amber – dubbed here “the solar stone” or “Baltic gold”. Since Neolithic times, the Amber Road, a trade route that ran across Eurasia, started here.

Kaliningrad Governor Nikolai Tsukanov told The Kommersant daily in June the annual turnover of the worldwide amber industry reaches €1bn ($1.27bn), but his region earns less than €20m ($24.5m) a year.

Whatever amber there is, it presumably goes to Moscow, but in fact it goes to China. Neither Lithuania nor Poland get nothing.

by - Ilya Shumanov, Transparency International

‘Blood diamond’

Today’s Amber Road is paved with crime, corruption, illegal schemes and occasional blood. Amber has become post-Soviet Russia’s “blood diamond” that has killed dozens of black diggers and enriched or impoverished thousands of craftsmen, smugglers and middlemen – amid an amber boom in China that sent prices up and redrew the world map of the “solar stone” trade.

Digger Alexander says his illegal job is his only chance to earn a decent living in the Montenegro-sized region of one million, where competition with European farmers made agriculture unprofitable, Soviet-era plants have been shut down, and rampant corruption stifles business.

“I have no other choice,” says the former schoolteacher who refused to provide his last name citing safety reasons. During a cigarette break, he climbs a hillock that overlooks a wasteland of dead grass, other man-made pools, and upturned soil that soak in the drizzle falling from the grey October sky. “Every third guy my age around here does the same,” Alexander adds.

At its birthplace, amber does not look precious. The bubbling vortex in the diggers’ pool brings up what looks like pieces of honey-coloured glass or braised Chinese pork, and one of the diggers fishes them out with a landing net and tosses them in a plastic can. Police ATVs may show up at any moment, and the team is always ready to pack up their pump, pipes and findings and rush away in a rundown, Soviet-made jeep.

Despite the desolation, the field – known among diggers as a “Klondike” – lies a couple of kilometres away from the airport of Kaliningrad, capital of the region that belonged to Germany until 1945 and was formerly called Eastern Prussia.

Russia’s only official amber mine is located 30km away from Klondike in the town of Yantarny, near the grey-blue waters of the Baltic Sea. Government-owned Amber Combine extracts up to 400 tonnes of amber annually from an open mine the size of a volcano crater.

German engineers started mining the “blue earth” deposits, the world’s largest, in the late 19th century. They also built a factory that occupies a compound of dilapidated redbrick buildings, mostly built before World War II, where several hundred workers size the amber and polish part of it for an in-house jewellery shop.

       ‘Black diggers’ search for amber outside the village of                         Khrabrovo, in the Kaliningrad region of Russia                     [Denis Sinyakov/Al Jazeera]

Bandits, crooks and thieves

After the 1991 Soviet Union collapse, amber mining – like almost any other industry in Russia – was rife with corruption and crime. Corrupt mine guards turned a blind eye to black diggers – who could get away with a fine of 500 rubles ($13) if caught, and who drove around in SUVs equipped with powerful pumps – or took part in the theft themselves. Hundreds of tonnes of amber were smuggled to Poland and Lithuania.

“There were bandits, crooks and thieves,” says Galina Spivak, a guide at Combine’s museum. Most of Combine’s 3,000 workers were fired and “resorted to what desperate Russian men do – drinking vodka and hanging themselves”, she adds bitterly.

In 2004, after a contract-style killing of a businessman who tried to wrestle control of the amber trade, a star was born. Viktor Bogdan, a former police sergeant nicknamed “Ballet”, monopolised the sale of Combine’s entire output to domestic and foreign buyers, and started calling himself “The Amber King”.

After the Kremlin’s intervention in 2012, Bogdan was charged with fraud and now awaits extradition from Poland. A new team headed by a former KGB officer was appointed to manage Combine and boost domestic production of amber.

These days, everything in Kaliningrad seems to be about the “solar stone” – local sports teams, children’s magazines, street and town names, and countless kiosks, shops and boutiques sell amber jewellery, chess pieces, massage mats – even liquors.

Black diggers now face hefty fines, confiscation of their pumps and cars, and criminal charges. Craftsmen are prohibited from buying raw amber outside Combine. Law and order seems to have returned.  

Amber-hungry China

But corruption analysts, industry leaders, and jewellers claim that under the new management, Combine started selling most of its product to China through Moscow-based companies – depriving Russian, Polish and Lithuanian craftsmen and jewellers of access to legal amber.

“Whatever amber there is, it presumably goes to Moscow, but in fact it goes to China,” says Ilya Shumanov of the Kaliningrad branch of Transparency International, an anti-corruption group. “Neither Lithuania nor Poland get nothing,” he says, adding if things go on like this, the industry “will either switch to half-legal ways, or simply disappear”.

Combine’s new director insists, however, he simply follows Russian President Vladimir Putin’s orders to “normalise” the extraction and sale of amber, and boost domestic craftsmanship. “We don’t have headaches about the way Lithuanians and Poles feel,” Mikhail Zatsepin says, adding he cut European exports short in 2013.

Things have never been this bad in the industry. They give us just enough to keep us from starvation.

by - Vasily Simonov, Amber Union chairman

But Kaliningrad jewellers and craftsmen say they have been getting little amber after Zatsepin’s appointment.

“Things have never been this bad in the industry,” says Vasily Simonov, chairman of the Amber Union that unites some 150 companies that employ more than 2,000 people in Kaliningrad. “They give us just enough to keep us from starvation.”

In June, his union fielded hundreds of protesters to rally in central Kaliningrad. More than 400 union members signed an open letter to Putin that detailed the new management’s shortcomings, and demanded transparency in the distribution of raw amber.

“What we get is a pig in a poke,” says jeweller Tatyana Semyonova who sells her bracelets, brooches and necklaces from a kiosk in central Kaliningrad. “They sell sealed packages where amber is mixed with garbage and useless [amber] dust.”

Dangerous work

No wonder that black diggers are thriving. They find layers of “blue earth” in forests and on farmland, and dive in shallow water with pumps and fishing nets and dig pits right on the shore. The pits sometimes collapse, killing or maiming the diggers.

“Many had their bodies totally broken, dozens died,” says Mikhail, a Kaliningrad businessman who earned a fortune digging amber. He refused to provide his last name fearing prosecution. But many more youngsters eagerly replace the dead diggers because “drugs don’t sell that well”, he says.

Chinese tourists look at a $10,000 amber necklace at a shop in Moscow [Denis Sinyakov/Al Jazeera]

Prices of amber vary dramatically depending on the size, colour, structure of a fragment, and the presence of insects or lizards inside. 

Prices have risen almost tenfold since 2000, and a milk-white, fist-sized piece that weighs more than a kilogramme can now fetch tens-of-thousands of dollars. 

During a digging season that lasts between April and November, a lucky and hard-working digger can earn enough to buy a house.

“This is easy money, you can’t ever get it anywhere else this fast,” says Transparency International’s Shumanov, adding a digger can earn about 200,000 rubles ($5,000) a month.

A wholesale buyer is not far from a pit, and then the amber is resold to local jewellers or smuggled abroad. The Polish Radio English Section reported in mid-October that confiscation of smuggled Russian amber has risen almost fourfold since 2012.

In recent years, Chinese buyers started arriving in Kaliningrad in droves mostly seeking out milky-white amber that Buddhists consider a sacred stone. The mineral is also used in traditional Chinese medicine to cure epilepsy, amnesia, and urinary problems.

Amber figurines and jewellery have also become a luxury item among affluent Chinese. But the Middle Kingdom’s tradition of craftsmanship is too different from those in Russia or Europe, and their only interest here is raw amber.

“They take away our daily bread, our work,” says Yelena Kochetkova, owner of the KTK jewellery workshop in Yantarny that employed 280 workers in 2011 – and now has only 85. “But their product is superior to ours, honestly.”

Source: Al Jazeera