The 2009 outlook for China's gold jewelry output and demand...
IS CHINA EMERGING as a major gold jewelry producer and exporter, as well as a fast-growing market? asks Commodity Online in Mumbai, India.
It seems so from the forecasts made for China's jewelry shops.
According to this week's 'Jewelry Shanghai 2009' trade show, China's jewelry industry can expect annual sales of 300 billion Yuan and exports worth over $12 billion. Already the world's No.1 Gold Mining nation today, China will consequently become one of the most competitive producers and a trade centre of jewelry and accessories in the world, as well as the world's biggest consumer market of jewelry – overtaking India.
But the development of the jewelry industry relies on an increase in national economic strength, plus a rise in consumer consumption and confidence. Jewellery consumption is often the first to suffer and the last to recover when the economy experiences drastic fluctuations.
As demand from countries with high jewelry consumption such as the US drastically decreases in 2009, China's processing and trade exports of diamonds, precious metals and others could greatly reduce. General trade exports of pearl, fashion accessories and coloured gemstones will also face challenges.
According to estimates, China already processes more than 100 million pieces of jewelry and gems every year. Jewellery supply is expected to considerably exceed demand in 2009, and competition among related enterprises will intensify. From October 2008 to the first quarter of 2009, under the influence of the global financial crisis triggered by the US sub-mortgage crisis, there was a marked decline in major diamond markets such as Europe, the US and Japan.
However, Chinese diamond markets are maintaining relatively fast growth, becoming the only region to maintain growth in diamond sales among the world's major economies.
According to statistics released by De Beers, the largest diamond producer in the world, in this financial tsunami, it has experienced a cold winter for sales in major markets such as Europe and the US. In China, however, the company's diamond sales grew by over 15% against the general trend.