Pearl Mania in China!
Emily “D.D.” Frontiere
Roskin Gem News Report
Affordable cultured pearls have been available to consumers for decades. More recent developments in the techniques used to culture Chinese freshwater pearls created a whole new source for cultured pearls at even more affordable prices. Then came the pandemic and its effect on the pearl industry was both unexpected and dramatic.
Tahitian pearls were hit especially hard. According to Fran Mastoloni of New York-based Mastoloni Pearls showing at AGTA, many farms growing Tahitian pearls were forced to pause operations when their Chinese nucleating technicians became trapped in their home country for up to three years as a result of the lockdown measures imposed by the government. The local workers were able to harvest the pearls that were already growing in the waters, but they lacked the skills necessary to implant the bead nuclei and get the process started. Some farms have yet to resume their growing activities. This resulted in a gap in the supply chain with relatively few pearls ready to go to market.
INSANE
Now, as we begin 2024, it is clear that we face a global marketplace which is short on inventory, while demand is higher than ever as a new obsession with pearls has emerged. Dealers at both the AGTA and GJX shows in Tucson this year attested to the fact that pearls were being bought up in 2023 at a rate that they, themselves, have never encountered before. When sellers were asked to describe demand in the last year, the word that kept coming up was “insane”. As for who these new buyers are that are driving this trend, many point to the Chinese specifically for snatching up the available pearl inventory at the first opportunity after it is harvested.
According to multiple sellers, a newfound Chinese demand for white South Seas pearls of fine quality is one of the most dramatic changes seen in the last year.
Feeding Frenzy!
Mr. Mastoloni described the desire for these pearls as nothing less than a “full-blown feeding frenzy”. He said that so much material is being snatched up that “it is very difficult to get any inventory at a reasonable price.” Mr. Mastoloni further stated that he is fortunate to have the loyalty of pearl farmers with whom he was done business for many years. They continue to supply him with new gems when many other farmers have chosen to simply sell directly to Asian buyers because that is where most of the demand currently lies.
Yitzy Stefansky of Jaco Group LLC, another New York based company showing at GJX shared similar sentiments. He said that “pearls have become very expensive and hard to access and source across the board.” Good quality South Seas pearls, he says, as well as Tahitian gems, are being bought up in great quantities by Asian buyers. Mr. Stefansky estimates that some auctions have seen prices inflate up to 300% of what they were just a short time ago. Unfortunately, the price increase is not necessarily good for business. Rather, Mr. Stefansky says that he has missed out on quite a few sales because pearls have become cost prohibitive for many of his buyers practically overnight.
Pearl Growers Auctions
Auctions are an important link in the supply chain of fine pearls, and they too have been drastically affected by the sudden spike in interest by Asian buyers. Mr. Mastoloni reported that the recent March Hong Kong Show had a very limited number of high-quality Tahitian pearls. At GJX, Sarah Canizzaro of California based Kojima Pearl spoke about one Tahitian pearl auction in Hong Kong which was entirely bought out by a single individual the day before the pearls were set to be viewed by the public. Other potential buyers, she said, never even got the opportunity to witness what was being offered. Upon making this statement, Ms. Canizzaro said simply, “the market for pearls is on its head right now.”
Buying Sight Unseen!
Sundeep Shah is the managing director of the Japanese-based Pearl Exporting Co., a business that specializes in Japanese Keshi pearls. According to the company’s website, the term “Keshi” translates to “poppy seed” referencing their often small size, ranging from 0.6mm–7mm. These pearls form in saltwater Akoya oysters when the bead nucleus used to culture pearls is rejected by the animal. Japanese Keshi are rare, can take many years to mature, and are completely comprised of nacre. In spite of selling about 70% of the total volume of Keshi pearls that are produced annually, Mr. Shah expressed that he has very little inventory left.
Mr. Shah also noted a recent change in how business is performed. He said incredulously that he has Chinese clients who have made six-figure purchases based on a video presentation alone. Mr. Shah also made an interesting statement regarding Chinese demand for non-pinked Akoyas. He speculated that it is not that this market has any particular love of the pure white pearls, instead, they want them because they are in the minority.
That is not to say that the Asian market is the only facet of the marketplace to see an increase in pearl sales. Mr. Mastoloni explained that his North American buyers are looking to “put some fun back into their jewelry collections”. This, he says, often means large pearls with strong coloration such as pink and golden hues. Aviva Benyehuda, a representative of New York company Eliko Pearl at AGTA, said that buyers are flocking to purchase her Maki-e Tahitian pearls which feature 24K gold inlay with abalone and enamel decoration.
Disruptions in the Supply Chain
Further complicating the issue of a lack of inventory of pearls is that some pearl farmers have not yet fully recovered from the impact of Covid. In addition to the disruption in the Tahitian pearl farms, Ms. Canizzaro referenced a recent die-off of the oysters that grow Akoya pearls due to disease as well as the effects of global warming.
However, they say what goes up must come down. Anthony To, director and managing partner of La Peregrina Pearls based in both Hong Kong and Tahiti represented at GJX, expressed concerns about the stability of the Chinese economy in 2024, describing it as “shaky”. He does not claim to know exactly how this will affect the demand and price of pearls for the rest of this year, but did say that, in the wake of the “explosion” of pearl prices, “the market might need to take a breath.”
About the Author:
Emily “D.D.” Frontiere is a gemologist, gems and jewelry appraiser, and freelance writer based in Santa Fe, New Mexico. You can read more of her work posted with the International Gem Society. ddfrontiere@gmail.com.
