The hammers are the Dwarven Hammers, which give you a Forge Bonus of 25%. It effectively means forging is 25% cheaper as before, and will stack with the same bonus of your Master Smiths (making it a 50% forging bonus, so all magic items will be half as expensive as before).
The Dwarven Hammer requires Construction 2 and Earth 3, for a cost of 20 earth gems.
Hmm just had a good game with that setup. Ended up with provinces with sorcerers and enchantresses and witches so quickly was able to 'call wild' and summon ... green flappy things They complimented the slower Ulm troops nicely and I got those hammer and some earth boots going and after a little empowerment one of my smiths was on 6 earth, not bad!