In the past few years, there has been a steady rise in pearl prices, and it looks like this trend will continue in full force. As we've explained before, supply is tightly tied to the health of the farming industry as well as global economic factors. Specifically global warming, the effects of the Covid-19 pandemic and disruptions to the production chain (The death of the Japanese Akoya Oysters).
In this post, we will explain each of the factors that brought the pearl prices increase as well as assess what the future holds.
Pearls are a high value commodity, and the recent deaths of Japanese Akoya oysters have put more pressure on pearls prices.
The number of pearl farms has become increasingly limited in recent years as a result of natural disasters and disease. The most recent example is the devastating impact of an oyster parasite called Bonamosis in Japan, which resulted in the deaths of over 70% of all mature oysters. This parasite has been found in other countries as well, including China and Australia, but it has not been as devastating as in Japan because their stock was much more limited than what it was there.
This led to global shortages of high-quality pearls due to lack of supply from one of the world's most important producers. The price of pearls per gram (mome) have steadily increased as a result.
We've seen a rise in demand for fine jewelry pieces that feature pearls recently as consumers look for ways to add luxe touches to their everyday outfits without breaking the bank on expensive stones like diamonds or rubies. This trend is expected to continue into 2023 with even more demand for these precious gems.
The Covid-19 pandemic has affected the pearl farming industry in many ways. The first and most important effect is the decrease in the supply of pearls. Due to the fact that many workers returned home to be with their families, there were not enough people to continue with production.
Another reason for the decrease of pearls is due to the lack of skilled technicians who could harvest and process the pearls. This directly impacted their quality as well as their volume.
The lack of qualified workers impacted both supply and demand. With fewer workers harvesting and cleaning pearls, there were not enough pearls available for purchase. This caused prices to rise significantly across all categories of pearls. This impacted Tahitian pearls (AKA Black pearls) the most, as the majority of technicians were not local.
The quality of nacre is related to the water temperature. The closer the temperature is to the optimum range, the higher the quality of pearls that can be produced by oysters.
The rise in water temperatures has a direct hit on nacre quality. As such, it is important for oyster farmers to monitor their water temperatures and make adjustments as necessary.
This is another reason for the rise of pearl prices recently. The availability of high quality pearls is decreasing, which results in a price increase. As global warming continues to affect our world, expect this trend to unfortunately continue.
Auctions have always been a means of distributing pearls from farm to wholesalers. Nowadays, the entry barrier to auctions was reduced, allowing almost anyone in, no matter where they are located in the supply chain. This created a situation where wholesalers often compete with their customers. As a result, the prices are increasing, as many of the bids are submitted by non professional pearl traders.
However, due to our strong relationships in the industry we have the ability to bypass this issue by sourcing direct from the pearl farms. In addition, we believe that the market will correct itself. The inflated bids in the auctions are bound to make the pearls procured in auctions hard to sell in the market. Therefore, we believe the bids will correct themselves making auctions a viable channel once again.
These effects did not have a lot of impact on Freshwater pearls as they are culture in fresh waters as the name suggests. However, the continuous lockdowns in China badly disrupted the global supply chain of freshwater pearls due to the fact that China is a main producer of these pearls.
In this post we saw the reasons behind the rise of pearl prices. So of them will be balanced in the future. For example, once the Japanese Akoya oyster population is restored, we will see productions go back to normal which will hopefully lead to a decrease in price (assuming a steady demand). However, some reasons such as water pollution, or global warming is out of our hands. This directly impacts the pearl quality, which leads to a price increase of higher quality pearls.
We at pearls.jp are committed to deliver the highest quality pearls with the highest service standards. So far, our long lasting industry relations have helped offset the discussed trends while enabling us to provide consistent supply of our beautiful pearls to our customers, worldwide.