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Synthetic gems trade posts best sales in years

Source: http://www.jewellerynetasia.com

Although already widely accepted in the West, reception of synthetics in Asia lags. But sooner rather than later, Asia is expected to follow suit, reports Charlene Co.

While issues such as radiation, rough shortage and fluctuating prices bombard the coloured gemstones industry, synthetic gemstone manufacturers – who for a time struggled for acceptance by both the trade and, more importantly, consumer markets – are experiencing their strongest sales in years.

RMC Gems Thai Co Ltd, a major manufacturer of both natural and synthetic coloured gemstones, could not agree more. Rajneesh Bhandari, technology consultant to RMC, noted that growth in the synthetic gemstone segment has been “much higher” compared with that in diamonds and coloured stones in recent years. “Created stones are doing well everywhere,” he told Jewellery News Asia “ This market segment is growing at a very fast pace, especially in the US, where acceptance of synthetic stones is higher in other markets.”
Hong Kong-based Sunning Holdings Ltd, a distributor for major synthetic stone manufacturers, like wise agreed that growth has been astounding. According to Louis Lo, director of the company, sales this year have increased by 20 percent.

He commented: “There is huge demand for synthetic stones, so most producers are adding production capacity. Over the next two to three years we can expect a boom in this industry. For instance, there is a long waiting list for our synthetic diamonds and synthetic emeralds.” Sunning is an authorized distributor for Kyocera synthetic opals, Chatham created diamond and Hrand Djeva synthetic corundums and spinels.

Wider acceptance for created stones
The changing perception of synthetic stones – their wider acceptance by Western markets in particular has been critical to the sustainability and growth of this industry segment. “Finally, more markets are accepting synthetic stones, and it is because of this that the segment has been doing extremely well in recent years,” Mr. Bhandari of RMC said.

Mr Lo agreed, saying: “In the West, they do not care if they are wearing a synthetic stone. Most of the time, what they are most concerned about is how it looks on them – very few today buy stones for investment.”
Asian markets, on the other hand, still need a bit of convincing. According to Mr. Lo, interest in synthetic stones in Asian markets is still not as high as that in the West. “Asians would still choose a natural stone, even of low quality, over a nice synthetic stone. I think up to now, the perception many Asian consumers have of synthetic stones is not positive.”

Synthetic stone manufacturers, however, remain optimistic that Asian markets will eventually come to accept the use of synthetic stones.  “ I believe that  a new generation of consumers in Asia will sooner or later accept the use of synthetic stones,” Mr. Lo commented.

Hiccups in the business
Just like other segments in this industry, the weakening US dollar has affected synthetic gemstones suppliers, especially those that do a lot of exporting.

According to Tiger Wu, manager at the Jindeli Group, their synthetic stones business dropped by more that 20 percent this year from the previous year, and profits are down to only 10 percent, or “ just enough to break even.”

China-based Jindeli Group, through its subsidiary, fashion Jewelry Co. Ltd, manufactures and exporters semi-precious stones, fashion jewellery and synthetic stones.

The increasing cost of labour in Chine plus the high turnover of workers at factories are also among the concerns faced by Chinese companies, Mr Wu said. “Owing to the shortage of manpower our production output is low and lead times are longer. An order that would usually have taken only two weeks now takes three.”

In the past, customers of synthetic gemstone manufacturers would worry that when they started to offer synthetic stones along with their natural stones, their buyers would fear that there could be a “mix-up” in the stones. This concern, however, has diminished over time, with gemological training and certificates becoming increasingly common, making it easy to tell the difference between natural and synthetic.
Moreever, with increased transparency urged in the gemstones industry, more manufacturers have sworn to adhere to full disclosure.

Source: JNA

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