Executives upbeat on gem and jewellery export outlook

Jul 30, 2023

published : 3 May 2023 at 10:12

newspaper section: Business

writer: Phusadee Arunmas

Exports of gems and jewellery (excluding gold) are expected to grow by 10% this year as demand in the high-end segment remains strong.

The anticipated growth comes despite lower shipments in the first quarter and risk factors related to the global economic slowdown, a possible recession in the US and the EU, geopolitical conflicts, rising energy prices, high inflation in many countries and increasing interest rates.

Sumed Prasongphongchai, director of the Gem and Jewelry Institute of Thailand, said products that retain strong potential include gemstone jewellery, while luxury jewellery remains in high demand.

In the first quarter, Thailand exported US$4.25 billion worth of gems and jewellery (including gold), down 22.8% from the same period last year.

Excluding gold, the shipments tallied $2.34 billion, down by 3.5% year-on-year.

Last year, the total export value of gems and jewellery (excluding gold) was $7.98 billion, an increase of 29.5%.

Including gold, the value amounted to $15.1 billion, an increase of 49.8%, based on support from a recovering global economy, the easing of Covid-19 restriction policies in many countries, increased international travel and tourism, and the resumption of economic activities, which led to continuous growth in global production and consumer purchasing.

Export markets that posted strong growth for Thai gem and jewellery shipments last year included Singapore (up 143%), Switzerland (up 79.8%), India (up 74.4%), Belgium (up 31.1%), the UK (up 30.8%), the United Arab Emirates (up 28.0%), the US (up 21.5%), Hong Kong (up 16.3%), Japan (up 4.44%) and Germany (up 1.03%).

Important export products that posted growth were polished and cut semi-precious stones (up 89.7%), gold (up 82.0%), polished and cut precious stones (up 64.3%), gold jewellery (up 45.2%), polished and cut diamonds (up 41.9%) and artificial jewellery (up 17.3%).

The factors that led to higher gold exports were increased demand on the global market and central banks around the world increasing their gold holdings by 1,136 tonnes, valued at $70 billion, the highest amount since 1967.

Several analysts believe gold will continue to be in demand this year, with further increases in gold holdings, said Mr Sumed.

"Given the export trends in 2023, it is still necessary to keep an eye on geopolitical conflicts. Energy prices and inflation remain high in many countries, and interest rates are rising, all of which are factors that hinder economic growth," he said.

"This has been clearly visible since the last quarter of 2022 and is expected to become more evident in 2023, as the US and EU economies are both at risk of recession. However, markets in Asia, including China, Japan and Asean, are still expected to grow."

Mr Sumed advised entrepreneurs who rely on major markets such as the US and Europe to adapt by focusing on designing products that meet customers' preferences and demonstrating their unique skills.

Other options include utilising environmentally friendly marketing techniques and reducing carbon emissions throughout their supply chains, he said.

These are global trends that are gaining importance, and opportunities must be sought from markets that are recovering, such as China, Japan, Central Asia, Asean and India, where there is an increasing demand for jewellery and accessories, said Mr Sumed.