LOT Holabird-Kagin Americana  /  2012 Hot August Auction  / 

1421

St. John d’el Rey Mining Company gold Ingot Minas Gerais, Brazil,c1930-50 - 2012aug - Numismatic

Currency:USD Category:Coins & Paper Money / Bullion Start Price:14,500.00 USD Estimated At:29,000.00 - 40,000.00 USD
St. John d’el Rey Mining Company gold Ingot Minas Gerais, Brazil,c1930-50 - 2012aug - Numismatic
Invoicing and lot pick up will NOT be available at the live auction.
SJDR 195 AV 559 9941. 17.95 Troy ounces.
St. John d’el Rey Mining Company Gold Ingots, Minas Gerais, Brazil, c1930-50.
Fred N. Holabird
Introduction
These two gold ingots came to us over the past year from a Brazilian family who has reportedly had them since about 1950. A family member worked in management for the company and was reportedly paid with these ingots, not uncommon in the mining business.
The St. John d’el Rey Mining Company is the most important gold mining company in South America. The company owned the prestigious Morro Velho mine at Minas Gerais and other mines, all located in the north west part of the Minas Gerais district along Sierra do Espinbaco. Today, it is a producing gold mine for AngloGold Ashanti. The mine is located at Morro Velho a place near Nova Lima today in Minas Gerais, one of the richest areas in the world for premium mineral specimens, and one of the great gold mining regions of the world. “The gold mine is the longest operating gold mine in Brazil and Morro Velho was the world’s largest, deepest gold mine prior to the 1940’s, when the extent of the South Africa discoveries expanded”, commented Gail Triner in a paper discussing the property titles and mining rights for the St. John d’el Rey. While other statisticians would argue with the “world’s largest” statement, though it certainly may have been true in the nineteenth century (see more later), the mine was certainly of major world importance for more than a century.
The St. John d’el Rey Gold Ingots in Contrast
The two gold ingots here are from one of the historically most important world gold mines. In the USA, antiquarian ingot collecting has centered around a few hundred precious metal ingots that are essentially from three sources- the gold ingots of the SS Central America, US Mint ingots, and all the others, that were passed down for decades through families. Most of those ingots are now “discovered”, though we seem to get a few new discoveries each year. Foreign antiquarian precious metal ingots are essentially from treasure discoveries, particularly those from the Florida Coast, such as the Atocha and sister ships, plus the 1715 and 1733 fleet discoveries. These ingots are well discussed in Spanish Treasure Bars by Craig and Richards. The occasional and rare discovery of Roman ingots adds to this, but these are so rare that they are rarely publicly traded.
In a separate category are the modern ingots, those less than 50 years old, and thus not officially “antiques”. These are also heavily collected, though collectors don’t value them in the same monetary class as the antiques. Many of these ingots have been described and illustrated in Nigel Desebrock’s two books Gold Refiners Bars Worldwide (1991) and The Industry Catalog of Gold Bars Worldwide (1998). In the latter two volumes, only a few antique or nearly-so bars are illustrated, which underlies the ultimate rarity of antiquarian gold bars worldwide. The reason that there are so few ingots remaining is simple- gold is an international form of money. When it is transferred, the old ingots are melted, the customer paid, and new ingots are formed from the old. This is the time-honored tradition in the gold business. It also assures the buyer that he is, in fact, buying gold of a certain fineness and weight. Thus the survival of old ingots is unlikely, because as soon as they are traded, they are melted. The collecting community has changed this for American ingots, but we still don’t see old worldwide ingots because they were generally all melted.
The St. John d’el Rey Mine History
The mine was one of the first of the first of the British mining companies to receive a Brazilian charter in 1830. Mining at the Morro Velho mine by the St. John d’el Rey Company started in 1834. This is significant, because it parallels our own American mining history, where the first gold mining companies chartered in the US were at about the same time, for companies with mines along the Appalachian gold belt. In fact, a city very close to Morro Velho was Vila Rica, a name later applied to a gold mining town in Georgia.
The Morro Velho Mine carried gold in a highly sheared calcareous schist. The gold came in native form, as well as mixed with various sulfide minerals. For the first thirty three years, from 1834-1867, gold was mined using “native” methods, but that led to a serious mine cave-in and closure. Nearly all of the initial mining was of massive placer deposits. Production through 1867 amounted to 3.163 million pounds Sterling, or nearly 1 million ounces of gold. The mine reopened in 1874, only to suffer another major cave-in in 1886, again causing closure. Production from 1874 to 1884 amounted to 1.665 million ounces of gold, paying an approximate ten percent dividend. The St. John d’el Rey Mine, like many other mining companies, used slave labor until it was formally prohibited.
As a British mining company, the mine assayer would have been British. They were very picky, and would never allow an outsider in this critically important position because the assayer was responsible for ore control and thus all production. But who was the assayer? We know that British mining interests in the United States often used the Bousefield family of three brothers who were classically trained assayers in Wales. The family worked at Treasure Hill and Virginia City, but did one of the brothers go down to Minas Gerais for the St. John d’el Rey Mine perhaps in the 1880’s? At least three American Bousefiled assayer ingots survive, but what of those from other countries?
In 1901, the mine produced 140,855 tons of ore that yielded 99,197 ounces of gold, a recovered ore grade of 0.704 ounces per ton gold. The 1930’s to 1950 period saw the St. John d’el Rey Mine mining company solve significant mining title problems, and this appears to be the era from which these two ingots came.
The company remained British owned and controlled until 1960, when rising costs competed with fixed gold prices to create an impermeable financial boundary. Few gold mines could sustain the economics of the period, especially in America, until the Gold Reserve Act was repealed in America in 1975, which followed the world market, which Americans had artificially held down.
The St. John d’el Rey Mine was the largest gold producer in South America, and the continent was third in world gold production ($30m) behind the US ($71m) and Mexico ($84m) in 1939. It, and another mine nearby, produced about 90% of the South American gold.
To fully understand the significance of the St. John d’el Rey Mine, here are statistics from 1939 and 1940 gleaned from G. A Roush’s (editor) Mining Industry…:
1939
Homestake Mine, South Dakota. Production: 608,000 ounces, gold; 168,600 oz silver from 1,940,000 tons. Average grade: 0.438 oz/t gold.
St. John d’el Rey Mine, Brazil. Production: 127,742 ounces gold from 383,000 tons. Average grade: 0.333 oz/t gold
1940
Homestake Mine. 542,215 oz gold from 1,433,737 tons. Average grade 0.378 oz/ton gold.
St. John d’el Rey Mine, Brazil. 125,999 ounces gold from 410,486 tons, average grade 0.304 oz/t gold.

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