I.

Market overview
Jewellery demand in China has sustained a brisk pace of growth in recent years.
According to National Bureau of Statistics figures, in 2003-2008, the average
annual increase in retail sales of wholesale and retail enterprises above a
designated scale was as high as 30.4%. As a result of a slowdown in the macro
economy, growth has slackened in recent years. In 2012, growth in retail sales of
jewellery was 16.0%. Then, in April 2013, a fall in gold prices touched off a wave of
gold buying frenzy among people from all walks of life. Retail sales of jewellery for
that month reached Rmb30.3 billion, representing a year-on-year growth of 72.2.
1.

At present, jewellery in the Chinese market can be divided into three categories:
metal, precious stone and others.
2.

Metal jewellery: jewellery made from all kinds of metals, which can be further
divided into:

Precious metal jewellery: Jewellery made from precious metals such as
gold, platinum and silver. Common examples are platinum jewellery, gold
jewellery, silver jewellery and alloy (karat gold) jewellery.
Non-precious metal jewellery: Compared with precious metal jewellery,
jewellery made from non-precious metals is good value for money.
Jewellery made from copper and aluminium is common.
Imitation precious metal jewellery: This refers to jewellery made from
materials bearing close resemblance to precious metals in appearance.
This kind of jewellery in fact does not contain any precious metals as
materials, but it gains wide popularity because of its advantages of stable
colour, cheap price and high decorative value.
Thin film jewellery: This kind of jewellery is made by bonding a layer of
precious metal firmly on the surface of another material through specific
techniques. Examples are gold plated, gold gilded and forged gold
jewellery.

Precious stone jewellery: Precious stones are made into ornaments through
the processes of grinding, carving, inlaying and stringing. Precious stone
jewellery is becoming increasingly popular because of its aesthetic value and
elegance. Common precious stones include diamond, ruby, sapphire, crystal,
jade, pearl, amber and topaz.
China Trade > China Consumer Market > Market Overview
Chinas jewellery market
6 Aug 2013
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Others: Jewellery made from materials other than metals and precious stones.
These can include clay, wood, strings, leather, ivory, etc.

Platinum jewellery: According to Platinum 2013, a yearbook by Johnson Matthey, a
multinational precious metals company, the worlds total demand for platinum
jewellery was up 12% in 2012. This was mainly caused by an expansion in the
retail network for platinum jewellery in China and a growth in manufacturer stocks
in finished jewellery. According to a survey conducted by the Platinum Guild
International (PGI) in January 2013, in the eight cities of Beijing, Shanghai,
Guangzhou, Chengdu, Shenyang, Taiyuan, Nanjing and Changsha, 68% of the
respondents indicated that they will use platinum inlaid with diamonds for their
wedding rings.
3.

Gold jewellery:In recent years, gold jewellery starts to make a breakthrough from
its traditional homogenous designs and matches boldly with other materials. As a
result, more and more young people fall in love with it. Figures from China Gold
Association show that, in 2012, gold consumption in China reached 832.2 tonnes,
up 9.3% year on year, of which 502.8 tonnes were attributed to gold jewellery, up
12.2% year on year. In the long run, driven by continued increase in upscale
consumption, a marriage and childbearing peak, and the trend of buying gold as an
inflation hedge, there is still a definite growth potential in Chinas consumer market
for gold jewellery.
4.

Diamond jewellery: Data reveal that, as a result of a slowdown in luxury sales in
the mainland, total transaction volume in Shanghai Diamond Exchange in 2012 was
75.11 million carats, a 49.3% drop on the year and an indication that the mainland
diamond consumption heat has cooled. On the other hand, market intelligence has
it that the mainlands retail market for diamonds is switching from high-price
products to more moderately priced ones with a concomitant drop in average price.
5.

Other jewellery: As ethnic fashion becomes a trend, Tibetan and Indian jewellery
are popular among young people. This kind of jewellery usually makes use of
materials such as silver, copper or cow bones. With its ethnic designs, it goes nicely
with the casual wear of young people. The prices of this kind of products are
declining because copycats are rampant. In the past, jewellery made of semi-
precious stones, glass and resins were called fake jewellery. However, its share in
the jewellery market is gradually rising, underscoring the diversified and multi-level
development trend of the market consumption structure.
6.

Made-to-order jewellery: In recent years, as the traditional sales model for finished
products of jewellery companies fail to meet the growing consumer demand for
exclusivity and individuality, made-to-order jewellery has been catching attention,
so much so that many companies have introduced made-to-order service. A host of
established jewellers, including Chow Tai Fook and Luk Fook, are attempting to
diversify into the business of made-to-order wedding rings.
7.

Wedding market: Out of the total consumption volume of jewellery in China, it is
estimated that more than 50% of jewellery sales are driven by weddings. And the
less developed a city is (such as second- or third-tier), the higher the share is. In
2012, Chinas newly-wed couples numbered 12.97 million. In the next few years, it
is expected that more than 10 million couples will get married each year. Therefore,
8.
Chinas jewellery market
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as essential items in traditional Chinese wedding customs, jewellery will benefit
from the growth in the number of people getting married.

The male market: While the traditional female market is a fiercely competitive one,
the male jewellery market is just emerging. The consumption interest of mainland
male consumers in jewellery products stems mainly from their knowledge of
diamonds. A De Beers report indicates that among Chinese males within the age
group of 30-44, 67% of them wish to possess diamonds. But compared with the
relentless growth in demand, the development of the mainland male jewellery
market is relatively slow. To address this situation, enterprises could open up new
markets by putting more efforts and innovation in product designs, product cultural
connotation, product point-of-sale promotion and advertising.
9.

Juniors market: According to Chinese traditions, people give longevity locks,
bracelets and necklaces to children as goodwill for a healthy and happy life. In
particular, gold jewellery items for wearing but also have inflation hedging value are
top choices for parents adept at managing finances. Nevertheless, compared with
the adult jewellery sector where new styles are launched often, childrens jewellery
offers fewer choices in terms of type and style and also receives less promotion
efforts.
10.

Seniors market: Compared with the young, elderly people give higher priority to
jewellery that provides inflation hedging as well as sentimental values. Industry
sources say that elderly spending on jewellery is no longer restricted to the four
traditional items, namely gold ring, gold bracelet, gold earrings and gold necklace.
They have a growing fondness for jewellery made from ruby, sapphire and jade.
Some old gentlemen like to wear a piece of white jade ornament on their waist,
giving at once an appearance of retro and chic.
11.

In 2011, the HKTDC commissioned a survey on jewellery consumption in 10
mainland cities. The findings indicated that:
12.

The most popular jewellery items purchased by respondents in the two years
preceding the survey were necklaces, followed by rings and earrings.
When purchases were made, the main considerations were purity of material,
good workmanship and reasonable price. Jewellery buyers were more partial to
gold than platinum. More and more consumers were buying jewellery for
inflation hedging.
The respondents reckoned that in the year to come, average spending on
jewellery would be Rmb4,566, 20% higher than the amount of Rmb3,783
found in 2007. For Hangzhou, Shenyang and Wuhan in particular, the increase
was as much as 30-50%.
The proportions of respondents who said they get jewellery information and
advice from TV commercials and from shopping malls/department stores
dropped by 7.2 and 4.2 percentage points respectively from 2007. The
percentages of those saying that they depended on recommendations from
friends and relatives and on newspaper/magazine advertorials were higher
than in 2007.
Hong Kong brands have a good reputation in the mainland. For mainland
respondents, they gave an overall image of being fashionable in design, trend-
setting in style and unique in character. Most mainland respondents were
Chinas jewellery market
3
willing to pay more for Hong Kong jewellery than mainland brands of similar
quality, with an average price premium of 46%.

Chinas major jewellery imports in 2012:
HS Code Description
2012
(US$ million)
2012/11
Growth (%)
7101
Pearls, natural or cultured, not strung,
mounted or set, or temporarily strung for
convenience of transport
46.8 9.4
7102
Diamonds, whether or not worked, but not
mounted or set
5,760.2 -6.3
71023100
Diamonds, non-industrial, unworked or
simply sawn, cleaved or bruted
1,444.5 -22.0
71023900 Diamonds, other non-industrial 4,228.7 -1.41
7103
Precious stones (other than diamonds) and
semi-precious stones, not strung, mounted
or set; ungraded, temporarily strung for
convenience of transport
787.5 -34.6
7105
Dust and powder of natural or synthetic
precious or semi-precious stones
21.0 34.4
7106
Silver (including silver plated with gold or
platinum), unwrought or in semi-
manufactured forms, or in powder form
648.0 -28.41
7107 Base metals clad with silver 11.8 -4.7
7110
Platinum, unwrought or in semi-
manufactured forms, or in powder form
4,472.7 -17.8
71101100 Platinum, unwrought or in powder form 2,637.6 -11.0
71103100 Rhodium, unwrought or in powder form 188.3 -40.0
7111
Base metals, silver or gold, clad with
platinum
5.6 -10.53
7113
Articles of jewellery and parts thereof, or
precious metal or of metal clad with precious
metal
504.5 12.56
7114
Articles of goldsmiths or silversmiths wares
and parts thereof, or precious metal or of
metal clad with precious metal
1.2 -30.2
Source: Global Trade Atlas
13.

II. Market competition
Mainland jewellery processing enterprises are mainly located in Guangdong,
Shandong, Shanghai, Fujian and Zhejiang. Guangdong tops jewellery production in
the whole country with Shenzhen and Panyu as the main bases for jewellery
processing. Shenzhen is dubbed the City of Jewellery as its jewellery enterprises
1.
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take the largest share of the domestic market through setting up sales counters
and specialty stores across the country.

Even though China has the craftsmanship to deliver the orders of top international
brands, development of its jewellery industry is hindered due to brand
inadequacies, substandard designs and technical barriers such as intellectual
property rights protection.
2.

The huge potential of Chinas consumer market has attracted numerous
international jewellery giants to scramble for a share. Big names such as De Beers,
the worlds largest dealer of diamonds; Cartier, the celebrated French giant in
watches and; Perles De Tahiti; as well as leading jewellery brands in Hong Kong
such as Chow Tai Fook and TSL have all entered the mainland market successively.
With the landing of foreign brands in the China market, competition between local
brands and foreign brands, as well as rivalry among foreign brands themselves are
likely to escalate. According to Euromonitor, a market research consultancy, Chinas
leading jewellery brands in 2012 included Chow Tai Fook, Chow Sang Sang, Luk
Fook, Lao Feng Xiang, Mingr, TSL and Chow Tai Seng.
3.

Jewellery brands are developing at a brisk pace and stepping up their expansion
into second- and third-tier cities. This means that in the few years to come,
jewellery brands will expand their markets in second-, third- and fourth-tier cities
with the help of franchisees, some of whom have superior resources locally and are
able to open up sales channels quickly.
4.

In 2012, different formats and different ways were adopted by various jewellery
brands to present their brands and the exquisiteness of jewellery. In addition to
compiling albums, shooting commercials, participating in exhibitions, hosting
product launch conferences and running connoisseur events, the use of micro film is
gaining popularity with the jewellery industry. Examples include the ones produced
by Chow Tai Seng and Swarovski.
5.

III. Sales channels
Mainland retail and wholesale channels for jewellery can be divided into the
following categories: jewellery counters at shopping malls, chain stores,
supermarkets, specialty stores and professional markets. The survey conducted by
the HKTDC in 2011 indicated that the most popular shopping spots were jewellery
counters at department stores, followed by independent or chain specialty stores.
In recent years, respondents claiming that they liked to purchase jewellery at chain
specialty stores in shopping malls or large supermarkets were on the rise.
1.

In recent years, more and more large-scale jewellery enterprises are turning to the
format of chain operations and specialty stores. This has led to fierce competition
among shopping mall jewellery counters. It has been reported that respectively
more than 2,000, 1,100 and1,500 chain stores are now owned by Chow Tai Seng,
Luk Fook and Chow Tai Fook.
2.

In recent years, Chinas jewellery brands have made bold strides in their
development via e-commerce platforms. With the website + experience store
3.
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5
concept it innovated, zbird.com is expanding quickly in the mainland. Chow Tai
Fook and Chow Sang Sang are trading through Tmall, an online shopping website.
Chow Tai Fook is beginning to develop its own B2C website. According to
incomplete statistics supplied by the Chamber of Jewellery of All-China Federation
of Industry and Commerce, there are presently 1,000 B2C companies specialising in
jewellery e-tailing. Although e-commerce in China is booming, the market is still
dominated by traditional jewellery brands.

Fairs held in the mainland provide the best channel for enterprises to gather the
latest jewellery information in China and beyond. They are also the best places to
meet dealers. Selected jewellery fairs to be held in the mainland in the second half
of 2013 are as follows:
Date Exhibition Location
31 October-4 November
2013
China International Jewellery Fair Beijing
13-17 September 2013 Shenzhen International Jewellery Fair Shenzhen
8-11 November 2013
China International Gold, Jewellery and Gem
Fair
Shanghai
17-19 October 2013 Beijing International Luxury Exhibition Beijing

4.
IV. Import and trade regulations
The import tariffs of jewellery items in 2013:
HS
Code
Description %
7101
Pearls, natural or cultured, whether or not worked or graded but
not strung, mounted or set; pearls, natural or cultured,
temporarily strung for convenience of transport
0, 21
7102 Diamonds, whether or not worked, but not mounted or set 0-8
7103
Precious stones (other than diamonds) and semi-precious stones,
whether or not worked or graded but not strung, mounted or set;
ungraded precious stones (other than diamonds) and semi-
precious stones, temporarily strung for convenience of transport
3, 8
7105
Dust and powder of natural or synthetic precious or semi-precious
stones
0
7106
Silver (including silver plated with gold or platinum), unwrought
or in semi-manufactured forms, or in powder form
0
7107 Base metals clad with silver 10.5
7108
Gold (including gold plated with platinum) unwrought or in semi-
manufactured forms, or in powder form
0
7109 Base metals or silver, clad with gold 10.5
7110
Platinum, unwrought or in semi-manufactured forms, or in
powder form
0.3
1.
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7111 Base metals, silver or gold, clad with platinum 3
7112
Waste and scrap of precious metal or of metal clad with precious
metal; other waste and scrap containing precious metal or
precious metal compounds, of a kind used principally for the
recovery of precious metal
0-8
7113
Articles of jewellery and parts thereof, or precious metal or of
metal clad with precious metal
20, 35
7114
Articles of goldsmiths or silversmiths wares and parts thereof, or
precious metal or of metal clad with precious metal
35
7115
Other articles of precious metal or of metal clad with precious
metal
0-35
7116
Articles of natural or cultured pearls, precious or semi-precious
stones (natural, synthetic or reconstructed)
35
Source: Customs Import and Export Tariff of the Peoples Republic of China 2013

Shanghai Diamond Exchange is the only legal channel in China for the import and
export of diamonds for general trading and for the domestic sale of rough diamonds
transferred-out in the course of processing trade. For its import and export policies,
customs control policies, tax policies and foreign currency management policies,
please refer to http://www.cnsde.com.
2.

Shanghai Gold Exchange began operation on 30 October 2002, signifying that
Chinas gold market is moving towards complete marketisation. For its business
rules and relevant laws and regulations, please refer to http://www.sge.sh.
3.

In 2002, China released the standard GB/T18781-2002 Cultured Pearl Grading,
which provided text descriptions on quality factors and grades of cultured pearls. In
the standard, requirements are laid down for the six freshwater cultured pearl
quality factors of colour, size, shape, lustre, surface smoothness and transparency
and the thickness of pearl layers (for nucleated pearls).
4.

Since May 2003, the mainland has abolished the licensing system for running
businesses in gold and silver products. As a result, the production, processing,
wholesale and retail of jewellery are under total market management. Anyone can
register as a natural person to operate a business in jewellery production,
processing and wholesaling.
5.

On 1 December 2004, Guangdong began a pilot reform project in delinking gold
price from workmanship fee in Guangzhous jewellery retail market. From 1
September 2006 onwards, the practice has been extended throughout Guangdong.
As stipulated in the Interim Measures for the Separate Marking of Retail Price and
Workmanship Fee for Gold Jewellery Items in Guangdongs Jewellery Market, prices
of gold jewellery items in the Guangdong market are now displayed in the form of
material price + workmanship fee, in contrast to the traditional method of pricing
on a per gram basis.
6.

On 19 August 2006, the National Development and Reform Commission published
three sets of industry standards: Precious Metal Adornment QB/T2062-2006,
Terms of Precious Metal Adornment QB/T1689-2006 and Jewellery -- Measurement
of Gold and Silver Coating Thickness: X-ray Fluorescence Spectrometric Methods
7.
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QB/T1135-2006. These three are revised standards for replacing QB/T2062-1994,
QB/T1689-1993 and QB/T1135-1991 respectively. The effective date of the first
two was 1 December 2006. For the last one, it was 1 September 2006.

The national standard Jade Grading drawn up by the National Gems & Jewellery
Technology Administrative Centre of the Ministry of Land and Resources has been
effective since 1 March 2010. This standard provides clear definitions and
classifications of ground and polished natural jade, both inlaid and un-inlaid.
8.

The national standard GB/T 25071-2010 Classification and Codes for Products of
Gems and Precious Metals was issued for implementation on 1 December 2010. As
an important basic standard in the computerisation of Chinas jewellery industry, it
provides the bases for the management, transmission, retrieval and dissemination
of data on information concerning products of gems and precious metals.
9.
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