Hong Kong jewellery sector upbeat on prospects

Gk_21_09

UBM Asia and Hong Kong trade association officials at the September Hong Kong Fair press conference

Hong Kong jewellery and gemstone trade associations are maintaining a positive outlook on business for the remainder of the year and in 2016.

At the September Hong Kong Jewellery & Gem Fair press conference yesterday, officials from Hong Kong associations cited demand from the US and Europe as the driving force behind sustained growth for the city’s jewellery and gemstone sectors.

King Li, president of the Hong Kong Jewellery & Jade Manufacturers’ Association, said that while sales dropped by 0.2 percent from January to July this year, business from the US and the European Union has stabilised. Other markets such as Thailand, Korea and Brazil have also shown significant growth in this period, he said.

Adam Lau, chairman of the Hong Kong Jewellery Manufacturers’ Association, agreed that the US market was on the mend. Deliveries to the Russian Federation have however fallen in the first half of the year, he said.

“We expect the next half of the year to get better because this is the high season for Christmas and year-end demand. Profit margins are not high though so we have to add value to the pieces through design and service,” Lau explained.

Lawrence Ma, president of the Diamond Federation of Hong Kong, China Ltd, noted a shift in demand for more affordable and fashionable diamond jewellery pieces with smaller stones. The US and European Union economies have bottomed out, thus demand from these markets is now on the rise, he added.

“It is now a time of consolidation for emerging markets after 10 to 12 years of uninterrupted growth. The next six months will therefore be a period of correction, an adjustment of the excess of the last few years,” Ma said.

For his part, Koo Tong Fat, director of accounting of the Hong Kong Jewellers & Goldsmiths’ Association Ltd, said that demand for mid- to low-end gold jewellery remained robust. “The decrease is mainly in the high-end market. The average selling price of goods
has been pulled down by the decline in demand for luxury jewellery,” he said.

Michael Sze, president of the Hong Kong Pearl Association,
was likewise bullish about prospects for the pearl sector. He expects demand to increase in the coming year as more international brands feature pearls in their pieces and designs are getting trendy and chic.

Prices of higher-quality pearls are expected to remain stable or register slight increases, while other types of pearl varieties might see a 10 to 20 percent decline in prices, Sze added.