FMF - Friends of Minerals Forum, discussion and message board

[Matt_Zukowski]

Discussions of mineral pricing are always interesting and lively.

Unlike assets that produce income and therefore have an estimable value, mineral specimens are worth whatever willing buyers and sellers, at a particular time and place, say they are. I don’t think there are “right” or “wrong” prices.

One thing that does bug me about this business is that it seems to be an oligopoly, with a couple of big name dealers at the top having all the best specimens. These dealers all watch each other’s pricing, and seem to do a lot business among each other. This coordination is one way they maintain their oligopolist power. These dealers also have multiple and partially-overlapping sourcing arrangements all over the world, networks that would be very difficult to replicate, thus producing a competitive advantage. This competitive advantage prevents new entrants who might add competition and lower prices. It seems to me that the only way to break this oligopoly would be to form a sort of buyer’s coop that could balance the power of the top dealers, or even build alternate sourcing networks to disintermediate them. But I think it would be too difficult to organize and maintain such a coop.

To those here who say that mineral prices are crazy or “wrong,” I believe you are basing your opinions on your experience of how minerals specimens used to be priced. This experience, while useful and relevant, may or may not be a good guide to prices in the present or future. When I first got involved in mineral collecting six or so years ago, everyone seemed to think that mineral prices were crazy. Now I personally have witnessed rapid appreciation, with some particular specimens that I fancied but didn’t buy because I thought they were too expensive appreciating 30% in one year. So does that mean the prices six years ago were right and the prices now are too high? Or were the prices six years ago crazy and the prices now even crazier? And what if prices continue to rise until they reach parity with human-made art? Would that make today’s prices good deals? Who knows?

To those who say that people who pay today’s prices are stupid neophytes with more money than sense, I say that people’s reasons and contexts for buying minerals vary greatly. Certainly I shop all over the place trying to get a bead on the market before I make an offer, but I found others who don’t have the time or inclination to endure these search costs. To them, restricting their search to the big name dealers and paying premium prices for good but likely overpriced rocks is worth it. My own personal experience with Tucson is that I no longer spend much time walking through shows other than the Inn Suites, the Westward Look, and the Main Show because the search costs are just too high. Yes you may be able to find a specimen that you might get for $100, after a lot of bargaining, that would be cleaned and then priced $1,000 at a big name dealer. But to find that one bargain you have to look through tons and tons of crap, and it just isn’t worth it to me.

To those who say that dealers, especially big name dealers, are doing something immoral with their pricing, I just don’t know. They are business people trying to maximize their profits within the context of their own moral sensibilities and long-term goals. This is what I do in my business – if I see a profit opportunity that I think is moral and fits into my long-term goals, I take it. Most people, if they know they can cross the street and make a higher wage, will do so. Now, I certainly would be angry if I had the experience that Gail had with the dealer that gave her the “Spann price.” And like Gail, I would not do business with this person in the future. But did this dealer act immorally? I figure that dealers are going to charge me the highest price they can, given their business goals. In response, I will pay the lowest price I can consistent with my collecting goals. The dealer who jacked up their price to Gail seemed to be more concerned with his short term business goals. My own experience is that most dealers treat me properly, at least in part, because they want to develop a relationship with me and are focusing on the long term. Likewise, I have an incentive to treat them well because they are never going to share their experience with me or show me the good stuff, the stuff that never gets on display shelves, if I don’t treat them with respect.

My two cents.

[John S. White]

I do not believe that anyone in this discussion has accused the big name dealers of acting immorally. I may disagree with much of their pricing, but that is a different story. I enjoy the search for bargains or sleepers among the lesser dealers and that is where I find most of what I bring home from the shows. I spend very little time with the inventories of the major dealers because I know there is almost nothing there that I can afford.

A very diffrerent prespective.

[Susan Robinson]

I fondly remember the good old days with much lower prices on minerals, and that included minerals of very good to high quality. My husband had finished graduate school and we were still living on an income from dealing in minerals. While at a Tucson Show during that period of time, he purchased the entire stock of a dealer's room at the old Desert Inn. We also were the first people at 1 am in the morning to view Harvey Gordon's room of the amazing pyromorphites from Kellogg, Idaho. We purchased a stack of flats of excellent quality specimens for much less than you'd pay for a miniature of the same mineral today. Those times were great fun and we have fond memories of our experiences at the mineral shows.

[Gail]

Ah yes Susan, bottom line...having fun at the shows. The joy I get when a friend buys a good rock is almost equal to when I buy a good rock. I say the more the merrier.

[Woody Thompson]

Susan, I remember those days too, but I have to remind myself not to look back at them with pink-tourmaline glasses. Salaries were much lower then (for us grad students especially), and there were certain New England dealers and rock shops in the 60's and 70's whose specimens were already out of reach for most of us (even their lesser stuff, but especially the coveted local pegmatite minerals).

That being said, I agree with you that there seemed to be a greater proportion of good minerals at moderate prices. I don't recall so many cases of extortionate prices being applied to inferior specimens, like I'm hearing about at Tucson this year. You had to shop carefully then and now, but now you have to work much harder at it. Funny how the best deals can still turn up at 1:00 AM in the last flat at the bottom of a dealer's heap. Shop 'til you drop!

[vic rzonca]

A casualty of price shock?

[GneissWare]

[Jesse Fisher]

Or maybe just the effects of one of Tennessee's other famous exports?

[Pierre Joubert]

[Michael Shaw]

I've enjoyed looking through the images in this thread to see what caught everyones eye at the show. Honestly there were so many wonderful displays, it's hard to capture in a collection of photos. The following are just a few of the things that I especially liked during our week in Tucson.

[Woody Thompson]

Nice photos, Crosstimber. I noticed the dead fly seen in fluorite photo earlier on this page had not yet been overcome when you shot that case of great fluorites (or maybe he's already been laid to rest?).

[David Dinsmore]

Gail, unfortunately the practice of setting prices based on how much a dealer thinks a customer will pay is not uncommon. A few years ago I made the mistake of dressing business casual in Tucson instead of wearing shorts or blue jeans. I noticed that negotiating discounts was much more difficult than normal and decided to do a little test. I would go into a room and pick out a specimen and ask the dealer for their best price. Then, I would leave and have my friend (dressed in an old T-shirt and jeans) go in and inquire about the same piece. Several times he was quoted a lower price. One Chinese dealer in particular quoted my friend a price that was so much lower that I had him buy the specimen for me. We now joke about "Tucson dress" which means dressing down to get the best price.

My other comment about mineral prices in Tucson is that this year it seemed more dealers than usual were "fishing" - asking prices well above what they realistically hoped to get for a specimen just in case a less knowledgeable collector with money came by. I found one dealer with a fantastic large cab Tsumeb cerussite that did not have a price. We talked about the piece and he told me he was looking for low 5 figures. It was well out of my range but probably worth it. When I went back through his room later he had labeled the piece with a price that was 1.5 times what he'd quoted me.

All of the specimens that really caught my eye at the beginning of the show (but that I thought were priced too high) were still for sales days later. A few of these I purchased but at discounts that were 40%-60% below the asking price. I just wonder how much better I could have done if I had been able to stay until the end of the show.

[Roger Warin]

Glad to see such a set of nice pegmatite flowers, Crosstimber.
Roger.

[vic rzonca]

What to do on a cold, rainy afternoon in Tucson.
1. Try to stay warm.
2. Commiserate.
3. Go have a drink.

[Herman van Dennebroek]

"The Tucson Show". A short impression