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Thursday, 16 April 2015 12:47

What’s the Future of Amber Raw Material?

Written by  Anna Sado
Dorota Cenecka: Baltic amber and gold Dorota Cenecka: Baltic amber and gold

Contrary to expectations, the Amberif trade fair didn’t provide an answer to the question about the nearest future of the amber market. Though, the fair has shown that the market is really saturated both with the raw material and products.

A year ago, hardly anybody would have expected such a drastic change of action. Back then, the prices were soaring unpredictably from one day to another, and today they are falling – admittedly, slowly, but also unpredictably. Last year, it was the seller who dictated the hard conditions of sale, today we’ve got a buyer’s market, thus the clients can pick and choose in the product range offered. What’s the reason for such a dramatic change? It’s resulted from a number of factors, among  the most significant ones has undoubtedly been the emergence of large quantities of Ukrainian amber on the Polish, Lithuanian and Chinese markets. The progressive saturation of the Chinese market, with both amber raw material and products has also been of importance there.  This year’s edition of the Amebrif trade fair, where there were fewer key-clients than usual, has confirmed this tendency. There has also been more Polish amber: “Last year, following the increase in prices everybody wanted to look for the raw material. There were new mining teams, working mostly on private land – the effects of their work are visible now” - says Krzysztof Twardowski. He estimates that currently, only in the Pomerania Region there are about 20 such teams, mining up to 2.5 tons of amber. The demand of Polish companies is estimated to be around 150 tons of jewellery standard raw material per year. 

There are many indications that soon there will be more material on the market. The Lithuanians declare that this year mining will begin from the deposits on the Curonian Lagoon – it is going to be about 30 tons per year, from the estimated 230. The Marshall Office in Lublin is preparing to open the second tender for deposit examination and mining in Górka Lubartowska, which is thought to have over 100 tons of the material. However, if the conditions are equally investor – unfriendly as was the case of the first tender, the chances to start mining in the near future are rather minimal. Though amber activities have slowed down in Parczew, following the new mayoral election, further activities largely depend on the results of geological examinations that are meant to be published in the spring this year. The deposits in that region are approximately 256 tons. The attempts to begin mining were taken last year, when there was a lack of material on the market. Is there any point in continuing these activities today...? 

Amber raw material is constantly getting cheaper – large and pretty blocks are the least affected by it, they are still well valued. The producers make only the necessary purchases and wait for a further decrease in prices. The supply of the material, especially from the Ukraine, is growing. On the market there are a lot of products that, contrary to expectations, have found buyers neither at the Amber Trip trade fair in Vilnius, nor at the Amberif in Gdańsk. Both events boasted a surprisingly rich range of selected yellow and white stones in gentle gold frames, priced up to 45 Euro for a gram of the product (while the average price was 20 Euro). This assortment was aimed mostly at the key buyers from China – unfortunately, there weren’t many of the key ones who make serious transactions. It is actually yet another event – after the trade fair in Hong Kong in February and in Vilnius in March, which indicates that the interest in high-end price range amber products has diminished on the Chinese market. Is the question about the alternative for this market more valid today than it’s been so far? Could the Arabic countries be such an alternative? Especially, taking into account the fact that this year’s edition of the Amberif trade fair was visited by visibly more amber lovers from the Arabic countries than in the previous years. It would certainly be an interesting market, however with significantly smaller purchasing power and quite different preferences than those of the Chinese clients. There are similarities to the American market, which is slowly leaning towards amber again, though with the preference small and cheap products. 

Meanwhile, we are waiting for the business outcomes of the Beijing International Jewellery Show in Beijing, where over a dozen amber companies are presenting their products in the Polish Pavilion.  

 

Anna Sado

Anna Sado

Trade journalist specialising in jewellery related topics. Since 2007 has been co-creator of the amber portal amber.com.pl

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