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The lines that you quote here come from the very beginning of the book. At this point, the nobleman has seen Shasta and wants to buy him from his "father." The "father" is trying to get the nobleman to give him more money for Shasta. This is when he says the line you quote to the nobleman.
The meaning of the line is that people's children (and the love between them and their children) are more valuable to them than material goods. The "natural affection" mentioned here is the love between parents and children. We are told that it is more valuable than food. A "carbuncle" is a jewel. We are told that people's children are more valuable to them than jewels.
This would be a touching speech if it were not for the fact that we know that Shasta's "father" is not sincere about what he is saying. He is just trying to get more money for selling Shasta.
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