House Of Garrard Opens Its First Boutique In Shanghai

The entrance of the new Garrard boutique in Shanghai

The House of Garrard has set up a shop in Shanghai to introduced Chinese citizens and tourists to the heritage of the world’s longest serving fine jeweler, while browsing the collections that include bridal jewelry, tiaras and rare gems. 

The boutique is located in the Bund district in the longest baroque style building in China built in 1911, which also happens to be the same year that Garrard opened its flagship store in London. 

To celebrate the launch of the boutique, the British jeweler has drawn inspiration from its heritage and created a selection of one-of-a-kind pieces exclusive to Shanghai. The Emerald Ivy suite is a combination of emeralds and brilliant diamonds consisting of earrings, bracelet and a transformable necklace that can be worn in three different ways. In addition, there’s the Eternal Fringe suite, a necklace and earring combination containing more than 40 carats of diamonds, and the Azalea Tiara, an all-diamond headpiece that reflects the romantic royal heritage of Garrard.

The Emerald Ivy transformable necklace

Other lines housed in the new boutique include Garrard’s iconic Wings collection and the new Enchanted Palace collection, a whimsical and modern take on the Great Exhibition of 1851, held in London. Garrard has a strong reputation for designing bespoke pieces and this will continue in Shanghai with clients being able to work with the London design team to create one-offs.

“We are incredibly proud and excited to be bringing The House of Garrard directly to the Chinese market with the opening of our Shanghai boutique,” said Joanne Milner, CEO of The House of Garrard. “We are confident that our iconic collections and bespoke designs, coupled with our long standing British heritage will find a happy home in one of the most dynamic and exciting cities in the world.”

A rendering of the Azalea Tiara 

The House of Garrard is known for working closely with the British Royal Family throughout the jeweler’s storied history. First commissioned in 1736 by Fredrick, Prince of Wales, and appointed crown jewelers by Queen Victoria in 1943, Garrard has served each subsequent monarch since. The House has created iconic tiaras which are still worn at state occasions as well as the sapphire cluster engagement ring worn by Princess Diana and Catherine, Duchess of Cambridge. 

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Chinese Conglomerate Completes Acquisition Of Buccellati

Gangsu Gangtai Holding has completed its acquisition of Italian high jewelry house Buccellati. 

The Chinese conglomerate has acquired an 85% stake in the luxury jeweler, internationally known for its time-honored hand-crafted techniques developed in Italy. The transaction price was based on an equity value of €230 million ($271 million) for 100% of the company.

Gangtai says it plans to both sustain its presence in existing markets—namely Italy, Europe and North America—and to develop in the new markets—such as China, Asia, the Middle East and Eastern Europe—with a five-year investment of €200 million ($236 million) that will fund 88 new Buccellati boutiques.

The deal was first announced in December 2016 and the closing was completed Tuesday at a press conference in Milan. In attendance was Xu Jiangang, founder and chairman of Gangatai Group, Andrea Buccellati, who will maintain his position as creative director, and Gianluca Brozzetti, who will continue as honorary chairman and CEO.

Buccellati, founded in Milan in 1919, is one of the most prestigious jewelers in Italy. It was family owned until 2013 when Clessidra, an Italian investment holding company, acquired a 67 percent stake of the company, with the remaining 33 percent retained by the founding family. 

With the new agreement Clessidra and the Buccellati family will retain the remaining 15 percent stake in the company. In addition, all jewelry making will remain at Buccellati’s headquarters. 

“Our will is to maintain Buccellati’s identity while enhancing all of the elements which make it one of the best known brands worldwide in the fine jewelry sector, including its craftsmanship, design and originality, which are the heritage of Italian jewelry,” Xu Jiangang said. 

“It is the will of the new shareholder,” Andrea Buccellati added, “to preserve the company’s uniqueness, especially its excellence, craftsmanship and quality. In this respect, Gangtai Group’s recommendation to keep the production in Italy represents a solid commitment.”

Gangtai Group is a privately held conglomerate in the consumer, culture, finance and health industries with a capitalization of approximately $3.5 billion and revenues of more than 1.4 billion. Its subsidiary, Gangsu Gangtai Holding (Group) Co. Ltd, is one of largest gold jewelry distributers and a leading internet jewelry retailer in China with more than 1.200 employees, and is focused on growing its presence in international luxury. 

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WGC Reports That U.S. Gold Jewelry Demand Up 3%, While Global Weakness Persists

Indian gold jewelry demand is making a comeback

Growth in U.S. gold jewelry demand resumed, leading to the strongest first quarter since 2010, the World Gold reported Thursday, as demand rose 3% year-over-year to 22.9 tons. The U.S. is firmly the world’s third largest market for gold jewelry.

The WGC Gold Demand Trends report for the first quarter of 2017 credited this growth to a post election lift in U.S. consumer sentiment. "Plain yellow gold was more popular in the U.S. than in European markets," WGC said in the report. "High end and online retailers performed strongly. The online segment is also gaining strength, particularly with continued growth in ‘clicks and mortar’ retailing—the overlap between the virtual and physical retail environments."

The U.S. was one of the few bright spots in a world still challenged by regional geopolitical and economic issues causing uncertainty throughout the world. More importantly, demand was curtailed by a 9% rise in gold prices from the end of December till the end of March.

A first-quarter surge in gold jewelry demand in Indian was enough to fuel a year-over-year 1% increase in global gold jewelry demand in the first quarter to 480.9 tons, according to the WGC. However, it is compared against an extremely poor first quarter of 2016. 

“Gold jewelry demand was broadly steady, but remains weak in the longer term context,” the WGC said in its report. “Demand was 18% below the 587.7-ton five-year quarterly average.”

India
In November 2016, the Indian government implemented a surprise demonetization policy that removed Rs15.44 trillion, or 86 percent, of the currency in circulation from India’s economy. This had an immediate devastating impact on the whole Indian economy, including the gold jewelry sector. It was the culmination of an extremely challenging year for India’s gold jewelry industry that included strikes, even more government regulations and high gold prices. All of this led to a seven-year low in gold jewelry demand in India in 2016. 

Against this backdrop a 16% year-over-year increase in gold jewelry demand to 92.3 tons in India in the first quarter of 2017, as reported by the WGC, isn’t as strong as it first appears. India’s importance in the gold jewelry marketplace can’t be underestimated. China and India accounted for nearly 56% of global gold jewelry demand in the first quarter. 

The WGC emphasized that despite the high quarterly gain gold jewelry demand remains weak, primarily due to the high cost of the precious metal. The good news is that “by the end of March, 85% of the value of currency removed from circulation under demonetization had been returned,” the WGC said in its report.

The WGC said the outlook in gold jewelry demand in India is “robust” with one caveat. “The market is wary of the forthcoming decision on GST (Goods and Services Tax— a comprehensive indirect tax on manufacture, sale and consumption of goods and services throughout India, with the exception of Jammu and Kashmir) and this will likely weigh on demand until the government’s final decision, due for implementation in early July.”

China
The massive, populous and increasingly upwardly mobile country is now easily the world’s largest market for gold jewelry. Demand for gold jewelry was down 2% year-over-year to 176.5 tons. 

An early Lunar New Year pushed gold jewelry demand in January, the WGC said. This was followed by a strong wedding season. However, “once the festivities were over, demand dropped off as usual—an effect that was more pronounced due to the backdrop of rising gold prices.”

The WGC described the gold jewelry industry as resourceful, but a slowing economic environment and changing consumer tastes are having a negative effect on gold jewelry demand. 

China, known for 24k gold jewelry, has experienced an increase in 18k products. Manufacturers responded by offering more intricate and contemporary designs. A new 22k segment was introduced to cater demand for new, innovative and trendsetting pieces. In addition, some retailers are increasingly becoming specialized in bridal jewelry. 

“So, although demand in China faces headwinds from the economy and the changing tastes of its consumers, the industry is keen and determined to adapt—an attitude that should help stem any weakness,” the WGC said.

Other Asian Markets
Jewelry demand within the smaller Asian markets was hit by a combination of rising gold price and rising political tensions in the region. In the face of rising gold prices, Japanese jewelry demand fell 9% year-over-year to 3.2 tons. A drop in Chinese tourists also was cited as a reason. 

In Thailand, sluggish economic growth contributed to a 5% decline in first quarter jewelry demand to 3.1 tons. “The government responded with several measures designed to boost the domestic industry,” WGC said. “These included waiving tariffs on raw material imports used in jewelry production , and making low interest loans available for small and medium sized businesses to upgrade machinery.”

Europe
Jewelry demand was again dragged down by weakness in France and the U.K., the WGC said. The rest of the region was stable. Demand fell 6% in France due to pre-election uncertainty and the rise in terrorist activity which has impacted tourism, the WGC said. In addition, branded silver is making continued inroads into market share.

The U.K. saw a 7% year-over-year first quarter decline to 3.7 tons. 

Middle East and Turkey
Demand in Turkey sank to a four-year low of 7.7 tons, the WGC said. Continued currency weakness in Turkey meant that the price of gold in lira rose more than in any other currency during the first quarter (+12%), undermining jewelry demand, which fell by 11% to 7.7 tons.

“The fragile economic and political conditions that have beset Turkey over recent years were again a key factor behind the weak Q1 number,” the WGC said. “The mid-April referendum on changing Turkey’s constitution from a parliamentary to a presidential republic weighed on demand for the sector. And the outlook for the market is weak as the local price remains prohibitively high for many at a time of deteriorating economic indicators.”

Demand in the Middle East was unchanged at 54.6 tons and it followed a familiar pattern, the WGC said. Jewelry demand in Iran jumped 27% in the first quarter year-over-year to a four-year high of 12.9 tons, helped by an improving economy and investment-driven purchases.

“Demand across the rest of the region remained weak in the face of low oil prices and subdued tourist numbers, the impact of which was exaggerated by rising gold prices,” the WGC said. “Although the UAE has imposed a 5% import duty, demand in that market was relatively robust as consumers rushed to buy before the full effect of the tax fed through to end user prices.”

Overall Gold Demand
The WGC Gold Demand Trends report—which tracks demand in gold for investments, jewelry and technology; and tracks gold supply as well—reported that overall global gold demand in the first quarter declined 18% to 1,034.5 tons. However, it is in comparison with the first quarter of 2016, which was the highest first quarter ever. 

There was slower demand in Exchange Traded Funds and in central banks. Bar and coin investment, however, was described as “healthy” while demand “firmed slightly” in both the jewelry and technology sectors, the WGC said. 

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Chinese Conglomerate Acquires 85% Stake in Buccellati

The Buccellati New York flagship store on Madison Avenue

Clessidra, an Italian private equity firm, and the Buccellati family said Friday that it sold an 85 percent share in Buccellati to Chinese conglomerate, Gangtai Group. 

Clessidra and the Buccellati family will retain a 15 percent stake in Italian high jewelry house. The company is reportedly valued at approximately $282 million. A source close to the deal would not confirm or deny the figure. However, the person did say that revenue in 2015 was approximately $42.8 million, making its valuation 6.6 times its annual revenue.

The new majority owners plan to expand into China and other Asian markets, according to multiple sources. As part of the deal the Buccellati family will retain creative control of the company.

Buccellati, founded in Milan in 1919, is one of the most prestigious jewelers in Italy, known for creating pieces using time-honored hand-crafted techniques. The company has an international presence, particularly in Europe and the United States with branded stores and distribution agreements.

Buccellati was 100 percent family owned until 2013 when Clessidra acquired a 67 percent stake, with the remaining 33 percent retained by the founding family. A year later the company announced a rebranding effort aimed at attracting younger customers. The company named Lucrezia Buccellati, 25-years-old at the time, as its first woman designer and the youngest person to hold that title. Her father, Andrea Buccellati, became president and creative director, later adding the title of chairman. In 2015, the company opened a five-story flagship store in Madison Avenue in New York as well as stores in Paris and Palm Beach.

The Buccellati creative team, Andrea Buccellati and his daughter, Lucrezia

Clessidra, in a statement, noted that since 2013, the family made significant investments to expand its distribution network, support the product offering and strengthen the management structure. Now it says Buccellati is ready to expand into China.

“We are particularly satisfied with the agreement reached with Gangtai Group,” Marco Carotenuto, managing director of Clessidra, said in a statement. “We have strongly supported Buccellati in the last three years achieving a 60 percent growth in revenues since acquisition. We believe that the company is now ready for a new growth cycle that Gangtai Group will support, considering also its experience in the jewelry market and its strong presence in China.”

Gangtai Group—which specializes in the consumer, culture, finance and health industries—has experience in the China jewelry market. Its subsidiary, Gangsu Gangtai Holding (Group) Co. Ltd, is one of largest gold jewelry distributers and a leading internet jewelry retailer in China, and is focused on growing its presence in international luxury, according to the statement. 

Andrea Buccellati will retain his role as creative director and honorary chairman of Buccellati. Gianluca Brozzetti will retain his role as CEO of Buccellati. Other members of the Buccellati family will also retain their involvement in the business, according to the statement.

“Our family founded this company almost 100 years ago and will continue to be fully involved to support its development, the creative mastery and production craftsmanship that enabled the establishment of a unique and recognizable style in jewelry and silverware,” Andrea Buccellati said. "We welcome the commitment of Gangtai Group to invest significant resources to further develop the Buccellati brand and platform.”

Buccellati one-of-kind gold earrings inspired by Odilon Redon's La Chute de Phaéton

Closing of the transaction is expected by the second quarter of 2017 and is subject to Chinese government approval. 

The deal team at Clessidra included Manuel Catalano, managing director, Marco Carotenuto, managing director, and Giulio Torregrossa, investment director. The sellers were advised by Mediobanca, Unicredit and Partners CPA as financial advisors and by law firms Gattai Minoli Agostinelli & Partners and Pedersoli e Associati for the legal aspects. The purchaser was advised by law firm Simmons & Simmons for the legal aspects. 

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China International Gold, Jewellery & Gem Fair – Shanghai kicks off November 18

The China International Gold, Jewellery & Gem Fair – Shanghai for the Eastern China market will be held November 18-21 at the Shanghai World Expo Exhibition & Convention Center. 

Now on its 12th edition, the Shanghai Fair will host more than 300 exhibitors from 17 countries and regions. The latest contemporary jewelry and classic bestsellers will be displayed in over 11,000 square meters of exhibition space. Large groups of exhibitors, such as those from Sri Lanka, Taiwan, Korea and India as brand new exhibitor will showcase their products under their respective pavilions. 

This year’s Shanghai Fair will unveil a host of new features, including the Asia-Pacific Jewellery & Watch Expo. The new exhibition will be held concurrently with the Shanghai Fair. It will offer a range of arts and crafts, timepieces and jewelry products. The new exhibition is a result of UBM Asia’s strategic alliance with the Shanghai NIU International Exhibition Co Ltd making the concept “one site two fairs,” become a reality. The Asia-Pacific Jewellery & Watch Expo is co-organized by the China National Light Industry Council, Shanghai Municipal Commission of Economy and Informatization Division of Foreign Economy. 

There are seven brand new pavilions at this exhibition, they are: Beijing Arts and Crafts Association, Guangzhou Light Industry Arts and Crafts Enterprise, Hunan Embroidery Research Institute, Committee of Collection and Research of China Horologe Association, Shanghai Gem and Jade Trading Center Co Ltd, Shanghai Timepiece Trade Association, and the Shanghai Jade Carving Culture Association. 

The pavilions will showcase a range of jewelry and gemstone products, luxury and antique timepieces, and arts and crafts. For instance, there are the “Eight Great Crafts of Yanjing,” representing traditional China’s palace art from Beijing; exquisite and noble antique silverware from the east and west, and, timeless embroidery that reflect the unique craftsmanship of artisans.

Others attractions include:

Sri Lanka Pavilion – Over 40 exhibitors under the Sri Lanka Pavilion showcasing the world renowned Ceylon Sapphire and a vast array of rough and polished gemstones.

Taiwan Pavilion – Around 30 Taiwan exhibitors specializing in Grade A fei cui jewelry and all kinds of high-quality coral and gemstone jewelry.

Korean Pavilion – Korean exhibitors offer a wide range of the latest fashion jewelry with trendy and innovative designs popular among teens.
India Pavilion – The brand new India Pavilion will debut at this edition of the Shanghai Fair. The exhibitors will showcase India’s unique jewelry craftsmanship in gold jewelry manufacturing and diamond cutting and polishing.

Special events – Jewelry design award ceremony, jewelry and craft auction, and educational seminars. 

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More than 8,000 Attend China Gold, Jewelry, Gem Fair

The 14th edition of the China International Gold, Jewellery & Gem Fair – Shenzhen attracted 8,683 local and overseas visitors during the show’s three-day run, ended April 22. They viewed and purchased products from 332 exhibitors from around the world in 20,000 square meters of exhibition space from 13 countries, including China, Hong Kong, India and Korea.

The number of visitors from overseas and Hong Kong region is 741 this year. The top 10 sources of buyers (excluding mainland China and Hong Kong region) were India, followed by Taiwan region, the United States, Russian Federation, Malaysia, Ukraine, Thailand, Korea; Pakistan, Singapore and Iran claimed ninth, and Australia.

Mainland Chinese visitors totaled 7,942 from 30 provinces, autonomous regions and municipalities of mainland China. The top 5 sources of local visitors were Guangdong, followed by Zhejiang, both Shanghai and Fujian claimed third, both Jiangsu and Shandong claimed forth, while Beijing ranked fifth.

The fair featured the third edition of the China Jewellery Market Summit, co-organized by the Shenzhen Fair and CJNA. It was divided into two main parts: a jewelry parade showcasing jewelry from a select group of exhibitors, and a panel discussion that featured speakers from four leading jewelry brands who shared their views on the latest developments in mainland China’s jewelry market; and how the retailers could tap new business opportunities through innovative thinking.

“The China jewelry retail market has been experiencing a lot of changes in recent years. It is slowing down after years of rapid growth,” Joe Ho, fair manager, China – Jewellery Fairs of UBM Asia. “The summit was a good venue to help local retailers understand the changes and hear about solutions to the challenges.” 

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Shenzhen Jewelry Fair Welcomes Buyers

The 14th China International Gold, Jewellery & Gem Fair – Shenzhen opened Wednesday at the Shenzhen Convention & Exhibition Center with more than over 300 exhibitors from 13 countries.

The trade fair, which runs till Friday, is scheduled to allow buyers to restock on inventory following a number of festivals, according to UBM Asia, which owns and operates the show. 

“The Fair offers jewelry trade buyers a timely opportunity to source from quality local and overseas exhibitors,” said Joe Ho, Fair manager, China – Jewellery Fairs of UBM Asia. 

For the first time the Antwerp World Diamond Centre has its own pavilion, which houses about 10 diamond suppliers from Belgium. Other specialty areas include the Korea Pavilion, Taiwan Pavilion, China Gold Association Pavilion, Baolin Pavilion and Liyang Pavilion.

Ho added that the fair includes the “China Jewellery Market Summit,” which will help the country’s jewelry market navigate through a tough economy.

“In addition, seminars covering hot topics will discuss how lab-grown diamonds impact the industry; the development of the colored gemstone market; and amber jewelry,” Ho said. 

For details of the special events, visit the fair website. 

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Shenzhen International Gold, Jewelry & Gem Fair Set To Open April 20

UBM Asia’s China International Gold, Jewellery & Gem Fair – Shenzhen will be held April 20-22 at the Shenzhen Convention & Exhibition Center. The event serves as a marketplace for approximately 300 local and overseas vendors exhibiting fine jewelry, diamonds, gemstones, raw materials, and tools and equipment in roughly 20,000 square meters of exhibition space. 

Among the attractions is the first-ever Antwerp World Diamond Centre (AWDC) pavilion, which adds to the Taiwan, Korea and China Gold Association pavilions. 

Special events include the following:

* Diamond Power Session, April 20 – Organized by AWDC, the seminar will discuss “Screening and Detection of Lab-Grown Diamonds.” Experts from AWDC will also share their insights on the latest developments in the diamond industry. Pre-registration is available until 10 April.

* China Jewelry Market Summit, April 21 – Co-organized by the Shenzhen Fair and CJNA, it is divided into two parts. First, jewelry brands will showcase their latest collections via jewelry parades, followed by a panel discussion where industry professionals will share their views on how creative marketing impacts China’s jewelry market. 

* Guangzhou Diamond Exchange Seminar, April 22 – Professionals from diamond industry will give attendees insights of latest hot topic—“Natural vs Synthetic, Perspective on the Global Diamond Industry.”

* Guangdong Gemstones & Precious Metals Testing Center Seminar, April 22 – Experts from the mainland’s leading testing centre will share their views and knowledge about the latest developments in colored gemstones, including amber.

For more details of the special events, visit the fair website. 

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2015 A Down Year For Gold Jewelry Demand

Colorful gold chains by Pomellato. Photo by Anthony DeMarco

There were few bright spots in the global gold jewelry market for 2015 as regional tensions continue to slow jewelry sales.

Annual gold jewelry demand declined 3 percent in 2015, year-over-year, to 2,414.9 tons as many markets remain under the strain of geopolitical tensions and instability, according to the World Gold Council. Fourth quarter demand meanwhile was a bit more stable with a 1 percent drop in jewelry demand, year-over-year, to 671.4 tons. In value terms, the decline was 9 percent. 

India, the second largest gold jewelry market in the world, was the main driver behind the gold jewelry economy this year, although it was not enough to offset losses in China, Turkey Russia, and the Middle East. In the U.S., steady, slow growth continues while spending on gold jewelry remains flat in Europe. 

India
A surge in demand in India during the second-half of the year resulted in a 5 percent gain in demand in 2015 to 654.3 tons (its third highest level on record) and ended the year with a fourth quarter increase of 6 percent to 173.1 tons. 

The WGC said November and December were “particularly upbeat” led by the five-day Diwali festival, which was preceded by a drop in the price of gold, leading to greater demand. Severe rains and flooding in southern India followed by reduction in foreign investment led to the first-half decline in demand. 

China
Demand in the world’s largest jewelry market saw a 3 percent drop in gold jewelry demand, year-over-year to 783.5 tons. Meanwhile, fourth quarter demand fell by 1 percent to 202.6 tons. The WGC blames the “economic slowdown and the stock market turmoil of the first half of the year was the primary driver behind this weakness, through its damaging effect on wider consumer sentiment.”

The WGC adds the country faces difficult times for retailers as tightening credit lines and slowing economic growth has put pressure on margins. Small regional brands, especially those in tier 3 and 4 cities, have suffered most. Larger retailers have fared better, “supported by a better product range and deeper pockets.” About 85 percent of the market consists of 24k jewelry with higher-margin 18k product grabbing more market share. Inventories are being managed conservatively, the WGC adds.

Hong Kong
The small but important market saw its gold jewelry demand “practically collapse,” with a 23 percent drop in the fourth quarter alone to 13.6 tons. The island is heavily dependent on mainland China tourists, which saw a steep decline in 2015 and into 2016. 

U.S.
Demand for gold jewelry increased 3 percent in the fourth quarter to 45.6 tons, matched by a “cautious” 3 percent increase in annual demand to 119.6 tons, the WGC said. The U.S. has now experienced eight consecutive quarters of growth. The main benefit was a drop in the gold price in the third quarter, which aided buying by retailers for the Christmas season. 

“The tentative uptrend that began in 2013 continues to hold for now, but feels fragile,” the WGC said. “On the one hand, consumers have seen their disposable incomes benefit from lower oil and heating prices. But on the other hand, a shift has been seen towards spending on travel and leisure rather than on retail goods. While creeping improvement in economic indicators provides some support, there is little call for enthusiastic optimism in the outlook for 2016.”

Other Asian Markets
Overall, the smaller Asian markets were a “mixed bag,” the WGC said, with growth in Japan, Vietnam, Indonesia and South Korea offset by losses in Thailand, Malaysia, Taiwan, the WGC said.

Vietnam was the high point as demand for gold jewelry expanded by 31 percent year-over-year in the fourth quarter to 3.9 tons, yielding a 25 percent increase in annual demand to 15.6 tons. This is due to a steep drop in the local price of the precious metal in 2015, combined with lower inflation and stronger economic growth, the WGC said.

Turkey
The important gold jewelry manufacturing hub wrestled with economic, political and regional disruption over the past year and is seen by the WGC as one of the major causes of the global decline in gold jewelry demand in 2015. Fourth quarter results were very much along the lines of the year-over-year weakness seen over the preceding three quarters as demand fell 26 percent to 15 tons. The lira is weak, which kept local gold prices elevated. “The fragile domestic economic and political backdrop—and proximity to conflict in Middle Eastern countries—badly affected consumer sentiment in the market,” the WGC said. “As did the terrorist incidents that spilled onto domestic soil.”

Middle East
Iran is the only bright spot as demand in the region declined 5 percent to 51.4 tons in the fourth quarter, giving an annual total of 224.1 tons, the lowest since 2012. “Unsurprisingly, further falls in the price of oil and continued conflict across the region have fed through to declines in gold jewelry consumption,” WGC said. “Declining tourist revenues were an added factor in the UAE.”

Russia
Annual Russian jewelry demand slumped to a 14-year low of 41.1 tons—39 percent below the 2014 total. Demand in the market has “collapsed” since the middle of 2014, with six consecutive quarters of double-digit losses. “Already crippled by the after-effects of military intervention in the Ukraine (namely, a freefalling currency and international sanctions), the market has been further clobbered by plummeting oil revenues,” WGC said. “There is little room for improvement in demand over the coming year.”

Europe
Demand for gold jewelry in demand declined by 1 percent in both the fourth quarter and full-year of 2015 (to 35.7 tons and 75.8 tons respectively). Slight improvement in the UK (+1%) and Spain (+6%) were offset by declines in France (-5%), Germany (-2%) and Italy (-3%) continued to shrink. 

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5,000 Attend China International Gold, Jewellery & Gem Fair – Shanghai

The 11th edition of the China International Gold, Jewellery & Gem Fair – Shanghai concluded with 5,025 buyers from 30 countries and regions, according UBM Asia, which owns and operates the trade fair.

Held December 11 - 14 at the Shanghai Exhibition Center, the fair featured 354 exhibitors from 25 countries and regions in over 14,000 square meters of exhibition space.

Out of the total attendance, 190 visitors were from overseas and Hong Kong, UBM said.

Celine Lau, director of Jewellery Fairs, UBM Asia, said that Japanese jewelry is one of the best-selling items in China. “In response to market demand, we launched at this edition the Japan Pavilion hosted by the Yamanashi Jewelry Association,” she said. 

Yamanashi is a jewelry manufacturing base in Japan, known for its craftsmanship and designs

Other show features include “The Premier Pavilion” for high-end fine jewelry and country pavilions from Korea, Sri Lanka, Taiwan, Thailand and Turkey offered visitors a wide variety of jewelry. 

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Hong Kong Jewelry Fair Exceeds Expectations

Inside the Hong Kong Convention & Exhibition Centre where the finished fine jewelry portion of the fair was being held. Photo credit: UBM Asia

Since the global financial crisis of 2008, economic instability, geopolitical tensions and outright war has factored into the September Hong Kong Jewellery & Gem Fair. But world’s largest trade fair proved to be resilient and kept growing.

This year, the fair (which ran from 16 - 22 September) may have faced its biggest challenge with a slowdown in the China market. For the show that bills itself as the “gateway to China,” this could have easily meant fewer visitors. However, the fair is on pace to achieve another year of record (although modest) growth, perhaps eclipsing 60,000 visitors. It should be noted that this is in comparison to a very strong 2014, when attendance grew by 12 percent.

Wolfram Diener, Senior VP of UBM Asia, which owns and operates the trade fair, acknowledged that not only China, but all the other BRIC countries (Brazil, Russia, India and China) are struggling this year. However, he also notes that jewelry sales grew 5.2 per cent for the first half of 2015 and the country's Gross Domestic Product grew by 7 per cent for the same period.

“I just came back from Shanghai furniture show and it had a 15 to 20 percent increase in buyers,” he says. “It’s not the market has perished but it’s a mixed picture.

In terms of sales it’s a little early but Diener says that business was better than the modest expectations going into the show.

“Most notable is that many exhibitors saw a more diverse buyer activity,” Diener says. “There were more orders from Japan, Korea, Philippines, US, whilst Chinese visitors appeared to buy more than earlier in the year.”

The number of vendors exhibiting this year totaled 3,748—53 more than last year—at the show’s two venues: The Asia World-Expo where jewelry making materials and equipment vendors are located; and the Hong Kong Convention & Exhibition Centre, for fine jewelry exhibitors. The small increase is because both convention facilities are full. Any growth is due to the creative use of the 135,000 square meters of exhibition space.

“It’s a small increase but it reminds you that the show is worldwide and it reflects our constraints,” Diener says. “If we have more convention center facilities we could grow much more.” 

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India Fuels A 14% Plunge In Global Gold Jewelry Demand

24k gold necklace by Gurhan

Widespread declines in Asian and Middle Eastern countries led by India fueled a year-over-year 14 percent reduction in gold jewelry demand to 513.5 tons for the second quarter of 2015, according to the World Gold Council. Modest growth in North American and some European markets was not enough to offset the decline.

India, the second largest market for gold jewelry, experienced a 23 percent year-over-year reduction to 118 tons, according to the WGC’s “Gold Demand Trends” quarterly report. This was largely due to extreme weather patterns (heat waves and unseasonal storms) in rural parts of the country, damaging crops, affecting the economic cycle in the regions. This was combined with the government’s decision to trim the selling prices for those crops, including rice and wheat. The rural areas account for about half of all Indian gold jewelry demand, the WGC said. Demand among urban consumers was more resilient.

In China, the world’s largest gold jewelry market, gold jewelry demand fell 5 percent in the second quarter due to the surging than plunging stock markets during the period. Both occurrences caused declines in gold jewelry demand, the WGC said. The rise in the stock market took people’s attention away from gold and the drastic stock market decline led to a detrimental impact on consumer sentiment.

“The Chinese jewelry industry faced a challenging time as manufacturers and retailers chased a smaller pool of consumers, leading to excess capacity,” the WGC said. “This partly helps to explain the increased market share of 18k jewelry as manufacturers reallocated resources towards promoting this higher-margin product.”

One of the few bright spots for the second quarter of 2015 was in North America, led by the US, in what the WGC describes as a “gentle upward course.” Year-over-year growth for the second quarter was 2 percent to 25.5 tons. This was highlighted by a year-over-year 11 percent rise in gold jewelry imports for April and May.

“The slightly erratic nature of US economic recovery has proved a headwind to more convincing growth, but we expect the recovery in demand to gain momentum as yet lower prices feed through to consumers,” the WGC said in its report.

In Canada demand rose by 5 percent and in Mexico by 7 percent. In South America, Brazil experienced an 8 percent decline.

In Europe, growth was marginal with a 1 percent increase in demand driven by modest gains in the UK (6%), Spain (6%) and Germany (7%). This offset declines in France (-8) and Italy (-5).

“While Italy’s export sector benefitted again from the upturn in the US, domestic demand continues to stagnate – hit by the weaker euro,” the WGC said. “UK jewelry demand continued to build on the solid base established in 2012. Total first half demand of 8.2 tons was the highest since 2010 and the recent gold price declines point towards further improvement over the remainder of the year.”

In the Middle East, gold jewelry demand dropped by 20 percent with all countries in the region reporting a decline.

* Turkey - Currency depreciation caused a 30 percent drop in demand.

* Russia – Demand fell by 45 percent. The WGC did not elaborate.

* Iran – The country experienced a number of negative forces driving down second quarter demand by 31 percent, including an increase in VAT, lower oil prices, currency weakness and international economic sanctions.

* UAE – Jewelry demand fell 22 percent due to lower spending by European tourists and regional geo-political tensions.

Among the smaller Asian markets, gold jewelry demand was mixed:

* Thailand – demand fell 5 percent due to continued economic contraction following last year’s military coup.

* Malaysia – Demand fell 5 percent to its lowest quarterly total since 2011due to the introduction of a 6 percent Goods and Services Tax in April.

* Japan – Demand increased 5 percent, aided by higher numbers of Chinese tourists.

* Vietnam – The country outperformed the rest of the region with a 22 percent jump in demand fueled by lower prices.

* Singapore – Demand fell 18 percent.

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