Southeast Asia is home to some of the world’s most beautiful pearls. Known for their big size and unique shine, South Sea pearls are very rare and therefore highly sought after. The region boasting significant marine biodiversity and nutrient rich warm waters provides the perfect habitat for the largest pearl producing oysters. Known scientifically as Pinctada Maxima, the oyster can produce a pearl of 10-15 mm in size after two to five years of patient care from raising the oyster to harvesting. Golden and silver lipped oysters produce golden and white South Sea pearls respectively. The second most valuable pearls are Tahitian black pearls followed by Akoyas, mostly produced in Japan.
The Philippines and Indonesia have been known as Asia’s largest South Sea pearl producers. Outside of the region, Australia is also famous for making these rare gems. According to government figures, Indonesia became the world’s biggest producer in 2015 with a market share of 43 percent during that year, thereby overtaking Australia. It currently makes around 5.5 tons of pearls a year, but the Ministry of Trade claims the country has the potential to produce at least 20 tons annually. Indonesian pearls come in different colors from white to deep gold, while the Philippines is particularly famous for its golden pearls.
Now these two countries have to increasingly compete with Myanmar, which has made great strides in recent years. Before 2013, pearl traders mixed Myanmar pearls with other South Sea pearls at international auctions, possibly because of international sanctions on Myanmar when the country was under a military rule. But after the easing of the sanctions and quality improvements made possible thanks to the knowledge transfer from foreign companies, Myanmar golden pearls have gained international prominence.
The international South Sea Pearl Auction in Hong Kong has featured the finest quality Myanmar pearls for five consecutive years now. When they first went abroad in 2013, the pearls made news headlines, as a particularly keen bidder paid as much as 30,000$ for an unusually large 19 mm pearl, eight times exceeding its floor price. In March 2017, the Myanmar pearl auction generated about 6.6 million USD in sales for a total of 224 Lots, averaging 43$ per gram. By comparison, the second highest price was offered for Otsuki sourced from Indonesia and averaged around 29$, with a total of 126 lots sold.
The pearl industry in Myanmar remains highly regulated. The state-owned company called Myanmar Pearl Enterprise (MPE), which is under the Ministry of Mining, regulates the industry granting concessions to investors. The company used to hold a monopoly until the passage of the Myanmar Pearl Law in 1995. Companies can invest in the pearl industry through a production sharing agreement with MPE. According to the 2016 data, there are three foreign and two local companies, in addition to three farms operated by MPE. The pearl cultivating areas are entirely concentrated in the Myeik Archipelago, a group of more than 800 islands in the southeastern part of Myanmar.
The Indonesian pearl industry consists of hundreds of independent pearl farmers spread across the country’s many islands. Much of the industry has been historically dependent on foreign investment from Japan and Australia, which provided the needed funding and technology. Despite the fact that Indonesia offers the least expensive pearls, it struggles to reach its full potential at the international market. There are multiple reasons for that, such as competition from resale markets and apparently less than optimal marketing strategies.
Pearls from Myanmar now sell as hot cakes at international auctions, being particularly favored by Japanese, Chinese and Hong Kong buyers. However, the domestic demand struggles to keep up, despite the country now holding local pearl auctions every year. The situation is similar in Indonesia, where the government has been making conscious efforts to promote South Sea pearls among local jewelry lovers.
In 2014 the government opened the House of Indonesian Pearls on Lombok, a major pearl producing island. It acts as an international trading center, as well as ensures that the traded pearls meet the national quality standards. The house also aims to promote knowledge about Indonesian pearls among the country’s population. In the Philippines, South Sea pearls have been a matter of national pride for decades, prompting the former President Fidel Ramos to declare the South Sea pearl the country’s national gem in 1996.
Indonesian producers face domestic competition from imported Chinese freshwater pearls, which are selling at cheaper prices and are increasingly becoming of better quality. Unlike saltwater South Sea pearls, freshwater pearls are created by mussels. One mussel can generate dozens of pearls, while an oyster can only produce one in its lifetime. This makes Chinese pearls significantly cheaper but also much less rare. There have been reports of treated Chinese pearls being labeled as Indonesian Lombok and Sumbawa pearls and sold at lower prices, which dealt a blow to the local pearl industry.
Philippine’s most well-known golden pearl producing farm called Jewelmer, which has been in the business since 1979, offers some hints about how to distinguish a high quality product. The most important factor is the pearl’s luster, or the amount of light reflected on its surface, with the most reflective pearls being the most valuable. By rubbing two pearls against each other, you can also tell whether a pearl is real. If it feels too smooth, it is likely to be a knock-off. As a product of nature, many pearls have blemishes on their skin and do not always come out perfectly round. While many people tend to prefer a perfect pearl, to a less demanding customer these small imperfections may also serve as revealing signs of the pearl’s authenticity.
South Sea pearls are considered so valuable in the pearl market to match the importance of diamonds for the gemstone market. However, climate change is now posing significant challenges to the future of the industry. Oysters require perfectly clean waters in order to produce high-quality pearls. The pristine environment of the Philippines’ Palawan Province and Myanmar’s Myeik Archipelago currently provide the ideal conditions for oysters. But rising water temperatures and ocean acidification from higher carbon dioxide levels may become damaging for the oyster shell in the future. If governments do not take appropriate actions to limit the impact of climate change and deter pollution, in a decade from now, these rare gems may become even more rare.
Polina Lenkova for Rough&Polished
