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| May/June 2004 |
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A Chinese Freshwater Pearl History
Just what is the appeal of the ever-popular Chinese freshwater pearl? Perhaps it is the wide array of unique colors, shapes, and sizes that attract buyers. Or maybe it's the fact that these pearls can be purchased at a reasonable price. Either way, China is now the leading producer of freshwater pearls in the world. But this wasn't always the case. Chinese freshwater pearls haven't always had a great reputation. Chinese pearl producers have learned from past mistakes and have been able to turn freshwater pearl production into a respectable, lucrative industry. Commercial production began in the late 1960s when China harvested its first freshwater pearls. Beginning in the ‘70s, large quantities of "rice krispie" pearls flooded the market. These oblong, irregular-shaped freshwater pearls quickly overwhelmed the market, sometimes selling for less than one dollar per strand. This influx of poor-quality pearls gave China and its pearls a tainted image, a reputation that took years to change. Chinese pearl farmers acknowledged the problem and studied the market to determine the needs of consumers, focusing on the development of larger, brighter, and more lustrous pearls of good quality.
By the early ‘90s, Chinese freshwater pearls began to tap into the Japanese akoya pearl market by producing better-quality pearls. The round and near-round freshwater pearls closely resembled Japanese akoyas, but with affordable price tags. This improvement in quality was essential for Chinese freshwater producers — they moved away from the notorious "rice krispie" pearls and slowly built their reputation. China continued to produce an overwhelming number of freshwater pearls. By 1995, China's freshwater pearl production was estimated at 500 tons. This oversupply led to a significant drop in prices along with low profit margins. Prices of rice and button pearls fell nearly 60 percent and round and near-round pearl prices were reduced up to 20 percent. At this time, freshwater pearls were extremely popular throughout the world, particularly in the United States. But as the increased supply flooded the market, more than 30 percent of U.S. importers stopped carrying Chinese freshwater pearls because of low profit margins and spotty availability of the better qualities and shapes. For the Chinese, the result of overproduction in 1995 was a strong incentive to focus more on quality, not quantity. 1996 was a year marked by an increase in demand, especially for round and near-round pearls. The estimated production of Chinese freshwater pearls was still high, coming in at 600 tons. Across the board, prices decreased in most freshwater categories, with prices of rice and button pearls falling up to 70 percent. Prices for round and near-round pearls decreased only by 5 to 20 percent, due to higher demand. As for suppliers, competition led many to specialize in specific sizes, shapes, and quality. By 1997, the overproduction that began in 1995 finally eased off due to a sharp increase in demand for freshwater pearls in domestic markets. Pearl farmers began to reduce production and were cultivating pearls for longer periods, both of which helped to curb oversupply. Prices also picked up, with demand exceeding supply in several pearl categories. China's round and near-round pearls could be found in various shades of pink, cinnamon, lavender, rose, and blue, as well as the traditional white. Near-round pearls were being sold at reasonable prices in sizes approaching 10 mm. Chinese freshwater pearls really started to shine in 1998, when the market was again flooded with these pearls, with an estimated production of 800 tons. But this time, China surprised the world by introducing better-quality pearls in a palette of colors coupled with a stunning variety of shapes and sizes. Freshwater pearls could be found in sizes ranging from 1 mm to 15 mm, all of which maintained a relatively affordable price, once again taking business away from the Japanese akoyas. The value of freshwater pearls produced at farm level was estimated at US$170 million. Chinese freshwater pearls have been a dominant force in the global pearl market for the past two decades. Improved farming techniques, a low-cost labor force, and the extensive cultivating experience of pearl producers has contributed to China's rise as a reputable pearl producer. To remain successful, China will need to continuously regulate production numbers and stabilize prices, thereby strengthening the image and value of freshwater pearls. Back to original article: Fresh Possibilities |
• Back to original article: Fresh Possibilities |
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