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Tude Jewel Shells are rare materials in Xenoblade Chronicles. They can be dropped by the Sacred Zagamei and Carbon Tudes, or temporarily traded for with Peppino.

Sources

Trade

NPC Area Affinity
Peppino Tephra Cave Overtrade

Enemy drops

Enemy Area Rate
Sacred ZagameiEryth Sea67.0 %
Carbon TudeEryth Sea32.3 %

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