Leave a request
Platinum demand ticked up in Q1 2018 thanks to the precious metal’s use in jewelry, which increased in Japan, the US and India.
Platinum demand ticked up in Q1 2018 thanks to the precious metal‘s use in jewelry, which made gains in Japan, the US and India
In India, retail sales even outperformed sales of gold and diamond jewelry, Platinum Guild International (PGI) reported on Wednesday (June 6).
India’s platinum consumption soared 25 percent in Q1, with the US and Japan following behind with increases of 12 percent and 2 percent, respectively. “India’s economy returns to strong growth, and the implementation of GST will continue to benefit the organised trade,” PGI stated.
“Partners reported robust growth in the first quarter, mainly contributed by heavier products sold by retailers,” the firm added.
Growth in India predominantly came from retailer Platinum Evara, as well as from a spike in men’s jewelry, both of which increased the average weight of platinum jewelry sold.
“With continued efforts on driving sales and benefits from working with organised retailers, platinum sales among PGI retail partners is anticipated to grow at 20-25 percent in 2018, with a stronger outlook for manufacturing demand to grow at 30-40 percent due to store expansion,” PGI noted.
For the US, continued gross domestic product growth combined with a low unemployment rate, strong consumer confidence and tax reform resulted in stronger jewelry sales.
The majority of the platinum jewelry sales in the US were attributed to bridal jewellery such as engagement and wedding rings.
“Platinum Born, the new branded collection of platinum jewellery from Japan to target female self purchase, was launched at the Centurion Jewellery Show and has begun hitting stores,” PGI revealed.
“In the US, platinum has mainly appeared in engagement rings and wedding bands. Platinum Born introduces a new category of platinum jewellery accessible to a wide range of consumers,” it added.
Going forward, the PGI anticipates another strong year for US platinum with a projected business increase of between 8 and 11 percent.
While Japan’s platinum demand was on the lower end for Q1 2018, it remained steady. Retailers with heavier representations of platinum sales were able to enjoy higher profitability compared to selling gold jewelry due to low platinum prices.
PGI stated, “Q1 platinum performance on a unit sales basis was up 0.1 percent compared to same quarter of 2017.
The firm added, “other than yellow gold, platinum was the only fine precious metal jewellery that showed a slight increase in unit sales. It is likely that yellow gold items were of lower price points than platinum jewellery.”
Overall PGI is positive on 2018, especially for platinum jewelry. Total retail sales of platinum jewelry in Japan are anticipated to grow 1 to 2 percent for 2018, mostly due to the non-bridal segment.
Despite increases in India, the US and Japan, China saw some decreases in platinum demand in Q1 that jewelry demand could not stop.
In manufacturing, PGI noted, “[p]latinum jewellery fabrication volume declined by 8 percent year-on-year in Q1, while gem-set fabrication increased by 7 percent year-on-year.”
And in retail the report stated, “PGI trade partners encountered a 9.2 percent year-on-year decline in Q1 2018 due to weak Chinese New Year sales.”
However, optimism remains despite less than 30 percent of retail partners reporting platinum business growth in Q1, as bridal sales were stable and remain the key driver for platinum sales.
PGI noted, “penetration within lower tier cities continues to be a key future growth opportunities.
Leave a request