Pearl prices have been climbing since COVID-19 days, but those who attended the 2023 Jewellery and Gem World Hong Kong, Sept. 18-24, says that costs are now stratospheric and across-the-board pearls supply is virtually nonexistent. The reason? Chinese demand.
“Demand for pearls in mainland China is the likes of which we’ve never seen,” says Fran Mastoloni of Mastoloni Pearls. “The Chinese were buying at wholesale prices that we can’t sell them for here in the U.S.”
While Chinese demand is causing scarcity in the market and driving up prices, other factors are partly to blame. In Japan there's been a shortage of akoya pearls due to mortality and fewer growers. Some white south sea pearls are still in short supply from pandemic days, when farm employees couldn't get to remote locations, meaning some locations nucleation just didn't happen. And in Chinese freshwater pearls, a shortage exists because of Asian live streamers who're buying out inventories from farmers and creating a tight supply in the local market.
“Not only are these live streamers paying more, they’re also purchasing entire harvests from top- to commercial-quality pearls,” observes Moss Makhoulian,
senior vice president of Richline Group, which manages the Honora pearl brand.
And Tahitian pearls … fuhgeddaboudit! Midsummer, a Chinese actress embarked on a campaign to promote a new movie by uploading social media posts of herself wearing a wide range of Tahitian pearl jewelry. The move inspired a fervor for Tahitians in Hong Kong, with most pearl dealers selling out even before the show opened. Some of these buyers, too, are snapping up entire harvests.
For American dealers and collectors, this mania will be felt stateside for a while to come.
“It’s hard [for dealers and growers] to resist that kind of money,” says Alec Rupp of Aloha Pearls, who exhibited in Hong Kong.
Prices of every variety of pearls have increased this year. In the spring, prices of white Japanese akoya pearls had spiked 80%, and now seven months later, they’ve risen again as much as 100% by some estimates. Even natural-color blue akoyas cost as much as 50% more. The weak exchange rate of the Japanese yen, however, is something of an aid to U.S. buyers. “But as soon as the dollar weakens, the advantage will disappear,” says Anil Maloo of Baggins Pearls. For now, his family is enjoying the popularity of akoya pearls. The Maloos have an overseas business that exhibits in Hong Kong, and all their akoyas were pre-sold before the show.
Freshwater pearls aren't immune to price hikes, either. Chinese live streamers are mostly to blame and are affecting U.S. dealers' ability to secure goods. Dealers say prices are up to a minimum of 50% and that traditionally non-nucleated varieties are difficult to find since the market is moving into growing more bead-nucleated fresh water pearls.
Costs of white South Sea pearls, meanwhile, aren’t any less expensive. Dealer opinions are that price tags are up as much as 200% year over year.
“Every few months, there is an auction and Chinese buyers pay 10–20% more than the market rate,” observes Gary Tarna of Hanadama Pearls. “Three months later at the next auction, they push up the prices another 20%.” “But they’re only selling into China—not in our market,” notes Mastoloni of the U.S.-based brand. Jeremy Shepherd of PearlParadise.com was in Hong Kong and heard U.S. peers grumbling about some of the white South Sea producers’ auctions. “‘What’s the point of going?’” he was told. “Chinese buyers are going, and American clients can’t pay those prices.”
To wit, dealers revealed that lots from one South Sea producer sold for double past prices.
“America and Europe haven’t come to grips with these prices,” says Tarna. “When they need to buy, they’ll have
And because of demand, farmers aren’t keeping the oysters in the water as long, inadvertently creating a shortage of larger—over 15 mm—pearls for the next several years.
Another issue at the point of whole sale purchase: you must buy entire lots.
“We don’t need to buy a bag of 1,000 loose South Sea pearls in all different sizes and millimeter shapes,” says Jonathan Louttit of Imperial Pearl. “I saw white South Seas in Hong Kong, but you can’t pick anything—you must buy the whole bag. Nobody wants to do that except the Chinese.”
The biggest price jumps are in Tahitian pearls. These are up nearly 300% in the
past six months alone because of Asian demand for all qualities.
By the second day of the Hong Kong show, all the Maloo family's Tahitian pearls were sold. "We had to display finished goods because we didn't have the merchandise left," he says.
Many more Tahitian pearl exhibitors in Hong Kong sold out of nearly every
thing days before the show opened. And what they did have left to bring to the show—a lot of old stock—sold out, too, some at four times the prices available before the fair.
This Asian demand for Tahitians can be largely attributed to one influencer. Chinese actress Ni Ni, best known for her part in the 2011 film “Flowers of War,” embarked on a Tahitian pearl-wearing series of social media posts in July to promote her film “Lost in the Stars.”
“I went through her pictures,” says Alexander Collins of Collins Pearls. “She was wearing everything from keshi to semi-baroque strands. That’s what got the Chinese excited and into all kinds of pearls. Now they can’t get enough, and there’s not enough to go around.”
Loïc Wiart of Poe Black Pearl hadn’t exhibited in Hong Kong in three years
because of COVID-19 and the long quarantine periods. He decided to return because the quarantines ended. He’s thrilled with his decision.
“I usually sell 30–40% of my inventory in Hong Kong, but this time I sold 95%,” he said. “In 40 years of selling pearls I have never seen a time like this.” Collins, the original grower of the 5–6 mm “tiny” Tahitian pearl, sold all his tiny inventory—from top quality to circlé—to one buyer at double his past prices. He was so pressed for more pearls that he dug out (and sold) his D-grade pearls—those with irregular shapes and poorer colors and luster. “That’s the stuff I normally don’t get offers on,”
Even Tahitian keshi that used to cost $3–$4 a gram sold for as much as $44 a gram in Hong Kong.
Rupp, a 10-year exhibitor to Hong Kong, witnessed the extravaganza himself. “By the second and third days of the show, Tahitian pearl cases were completely empty.”
And replacing or increasing Tahitian pearl production is not as simple as putting more oysters in the water. Each farmer must adhere to quantity restrictions implemented by the government of French Polynesia according to the number of
square meters they own.
His advice to American merchants? “Raise your prices.”
Lack of Goods & High Wholesale
Even if U.S. dealers can afford the new high prices, finding anything to buy is the challenge.
“It’s not so much can we afford it, but can we get it?” says
It’s the same story for Imperial’s Louttit. “You can have all the high pricing you want, but it doesn’t matter when nobody has any product to sell you,” he says. “There’s virtually nothing to buy.”
It’s particularly problematic for companies with robust dropship programs, including Imperial. “I can sell it, but I might not have it, and I can’t buy it at any price,” Louttit deadpans.
Super-high wholesale prices are another bitter pill to swallow. “If you think you will pay X dollars, I guarantee you that a Chinese buyer came in the day before and paid double what you wanted to pay,” adds Louttit.
For certain, some retail prices now are cheaper than new wholesale prices in Asia. “It’s great for the pearl farmers, but no one in America or Europe will be able to buy at these prices,” says Sonny Sethi of TARA Pearls.
New Asian-driven wholesale pearl prices are so high that even some American dealers are selling inventory to Chinese buyers. At press time, Peggy Grosz of Assael was about to receive a Chinese buyer looking for inventory, a rare occurrence. “That never happens,” she concedes.
Even Tarna sent some of his top goods—largely white South Sea pearls—to Hong Kong to sell. To replenish stock, he’s reaching out to past clients with new goods that haven’t yet sold.
“If they can sell them back to me at the same price or a little better, so be it,” he says. “Asia is where the new prices are taking effect. The West will have to make adjustments.”
U.S. companies aren’t jeopardizing relationships with long standing clients, of course, but some firms have unloaded older and less desirable pearls to eager Chinese buyers. A case in point: One dealer packed up 80 pounds of “worthless”
goods and sold them all to one Chinese client who didn’t even haggle on price.
Many of these pearls are C to D quality that sold in the past for 80 cents to $1.50 per pearl but are now moving for $12 a pearl. Circlé necklaces that used to sell at keystone prices of $300 are now commanding $2,000.
Shepherd and his wife Hisano shopped the fair in a near-constant state of sticker shock. They spied hanks of AAA-quality akoyas for which they would normally pay upwards of $600 apiece selling for $2,200. A 10–12 mm white South Sea strand
with a lab report that the Shepherds would have typically purchased for about $6,000 had a price tag of $49,000. A 7.5–8 mm akoya pearl strand that the couple initially thought was $1,400 wholesale had a sticker price of $14,000.
“We would have retailed that piece for around $3,000,” he says. Many of his longstanding vendors know that Americans may struggle to meet the new Asian price points, which is why one of Shepherd’s partners raised his pearl prices 40%—
much less than other sellers. What did Shepherd do? “I thanked him,” he says. “He did it for us.”