United States - Jewellery Briefing

Jewellery | Who's Who

Briefing

According to figures published by GFMS, the United States in 2001 ranked fourth in the world, after India, Italy and China in gold jewellery fabrication, using 158 tonnes (5.1 million oz) of fine gold. Production had grown by 50% since the recession-induced low point recorded in 1991. In 2001, however, the industry suffered a major setback. Production slumped due to a high level of trade stocks being carried over from the previous year. This owed much to, and was exacerbated by, a recession-induced weaker trend in US jewellery consumption that had set in from the fourth quarter of 2000 onwards. Finally, and especially with the strong dollar over much of 2001, competition from imports was ferocious. As regards the last of these challenges, up until 2000 US manufacturers' loss of market share to imports had partly been cushioned by not only rapid growth in US jewellery consumption but also due to American companies relocating part of their production abroad. In 2001, however, both imports and domestically produced articles registered sales declines at the trade level. The picture was a little brighter at the retail level due to a major rundown of inventories.

The manufacturing industry was originally centred in New England, in Massachusetts and Rhode Island, but has since diversified to other parts of the country, such as Florida and, especially, Los Angeles. The industry numbers approximately 4,000 production units of which 80% have less than 25 employees. Consolidation within the industry brought the number of manufacturers down by 20% during the 1990s. It is common for US manufacturers to focus on specific production lines.


American finalist entries in the World Gold Council Gold Virtuosi 2000 competition (Credit: World Gold Council)

The bulk of production is in 14 carat with growing volumes of both 10 carat and 18 carat jewellery. Exports account for up to a quarter of production; major destinations are Mexico, Canada, Hong Kong and the UK.

The US home market at the trade level absorbed 381 tonnes (12.2 million oz) of jewellery in 2001. This represented a 7% decline from the previous year's record high. As explained above, this setback came after a decade of uninterrupted growth - consumption in 1991 according to GFMS was by comparison only 238 tonnes (7.7 million oz). Over the period, the share of the domestic market taken by imported jewellery has grown from just over half to more than two-thirds. The main supplier countries are Italy, India, Turkey, China and Thailand. Recent growth from East Asia has been notable, especially from mainland China and Hong Kong. Both India and Turkey have until recently enjoyed duty exemption thanks to the Generalised System of Preferences while Italy has been subject to the handicap of a 6.2% import duty.

Source: Gold Fields Mineral Services

According to GFMS the value of plain gold jewellery retail sales was over $16 billion in 2001 in an overall jewellery market of more than $40 billion. Even though 2001 was a difficult year, over the past decade the size of the US jewellery market has risen by close to two-thirds. This growth has been attributable not only to an increase in consumers' purchasing power but also to highly efficient discount jewellery chains and non-store retail outlets. From a low base, on-line jewellery sales are rising sharply and are predicted to exceed one billion dollars by the year 2003.

Although 14 carat remains the norm in the US market, 18 carat jewellery has gained some ground as American consumers become more international and sophisticated in their tastes for fine jewellery. Ten carat has also been rising as it provides lower price points in the market for heavier articles.