India enjoyed the monopoly of supplying the world’s demand for diamonds up to the discovery, in 1725, of the precious stone in Brazil. Small stones were detected by the miners in the gold washings at Tejuco, about eighty miles (129 km.) from Rio de Janeiro, in the Serro do Frio district of the State of Minas Geraes. The discovery naturally caused great excitement. So many diamonds were found that in 1727 something like a slump took place in their value. In order to keep up prices, the Dutch merchants, who mainly controlled the Indian output, asserted that the diamonds had not been found in Brazil at all, but were inferior Indian stones shipped to Brazil from Goa. The tables were neatly turned when diamonds were actually shipped from Brazil to Goa, and exported thence to Europe as Indian stones. This course and the continuous development of the diamond district in Brazil rendered it impossible to hoodwink the world indefinitely. The drop in prices was, however, stayed by the action of the Portuguese government, who exacted such heavy duties and imposed such onerous conditions that finally no one would undertake to work the mines. Accordingly, in 1772 diamond-mining was declared a royal monopoly in Brazil, and such it remained until the severance of Brazil from Portugal in 1834, when private mining was permitted by the new government subject to the payment of reasonable royalties. The industry was enormously stimulated by the discovery, in 1844, of the remarkably rich fields in the State of Bahia, especially at Serra da Cincorá, where carbonado, or black diamond, first came to light, but after a few years, owing to the difficulties of supplying labour, the unhealthiness of the climate, and the high cost of living, the yield fell off and gradually declined, until the importance of the fields was finally eclipsed by the rise of the South African mines. The Brazilian mines have proved very productive, but chiefly in small diamonds, stones above a carat in weight being few in comparison. The largest stone, to which the name, the Star of the South, was applied, weighed in the rough 254½ carats; it was discovered at the Bagagem mines in 1853. The quality of the diamonds is good, many of them having the highly-prized bluish-white colour. The principal diamond-bearing districts of Brazil centre at Diamantina, as Tejuco was re-named after the discovery of diamonds, Grão Magor, and Bagagem in the State of Minas Geraes, at Diamantina in the State of Bahia, and at Goyãz and Matto Grosso in the States of the same names. The diamonds occur chiefly in _cascalho_, a gravel, containing large masses of quartz and small particles of gold, which is supposed to be derived from a quartzose variety of micaceous slate known as itacolumite. The mines are now to some extent being worked by systematic dredging of the river-beds.