3. TAHITIAN BLACK PEARLS: Present Market Situation (continued)

3.3 Colour (continued)

Table 7. Black Pearls Exports from Japan 1994 – 1997 (without Half Pearls)

Table 8. Total Production and Sales of Black Pearls
(Black-lipped oyster pearls) in 1997

Table 9. Amounts of Black Pearls Exported from Tahiti to Japan and Imported to Japan from Tahiti

* From the data of Ministere De La Mer, France
** From the Trading Statistics, Ministry of Finance, Japan

Colour can be controlled by the use of different tissue pieces when seeding the pearls. The three basic colours in black pearls are red, green and yellow. Body colour (overtones) can be subdivided into six groups: silver, silver-blue, gold, brown-black, green-black and black. This overtone may be any combination of pink, lavender, blue, peacock blue, gold-green or reddish purple.

The colour most characteristics of fine Polynesian black pearls is greenish black, also referred to as “peacock green”. The gray pearls are highly appreciated by Western countries, and are sometimes valued higher.

The Tahitian producers are making pearls of peacock green, targeting the Japanese market that is at present the biggest buyer. However, the Japanese market has reached its saturation point, and the black pearl market has gradually become diversified. In Japan, the sales of Akoya pearls has decreased to a great extent, but surprisingly, only the grayish colour pearl, the so-called “natural colour gray pearls”, have became very popular. The gray pearls of the black-lipped oysters have also benefited by this popular demand.

3.4 Coating (nacre)

The thickness of the pearl's coating, the nacre, is one of the most important factors to consider when assessing the value of pearls as gems.

The cultivation period is usually 18 months or more, depending on different conditions like water temperature and weather. Unfortunately, there are some producers who intentionally shorten the cultivation period and harvest earlier, with the result that the pearls have a thinner nacre and are therefore of inferior quality. Although the thin-coated Akoya pearls can be easily detected by the naked eye, thin-coated black pearls are very difficult to discern. The thickness of the coating can only be detected by X-ray examination. Some producers take advantage of this, which inevitably will cause problems in the future.

3.5 Quality

The quality of pearls is one of the most difficult items to be detected by amateurs and that is why it is called a “blind item”. Therefore, professional pearl dealers are required to watch and strictly control pearl quality.

First, in order to protect the consumers, the JBPP (Japan Black Pearl Promotion), are planning to attach a guarantee mark to each piece of black pearl merchandise to prove that it has natural colour and is not dyed. Second, the Tahitian government has changed the export tax from value to weight proportion. This step has been taken to encourage the export of high quality pearls.

3.6 Structure of the Tahitian Pearl Industry

There are approximately 400 registered large and small pearl producers. The number of producers may differ from year to year; currently, there are about 250 producers actually operating, and most belong to the organizations listed in the following table.

Pearles De Tahiti is a promotion agency and is not involved with actual business transactions. Its board is composed of 12 members:

Promotion activities overseas are quite positive. In Japan, the JBPP, cooperating with Pearls de Tahiti, has about US$1.7 million as an annual budget, and are promoting black pearls in various trades and other fashion magazines.

An important point of this organization is that the largest producer who is a member of SPPP makes over 50% of the total production. There are several big producers and they together produce about 85% of total yield. Although the G.I.E. Poe Rava Nui has the most registered members, it produces only 4% of the total production. Reasons for this will be given later.

3.6.1 Establishment of G.I.E. Poe Rava Nui

a) History

In order to raise the black pearl culture industry to the level of a national industry, the Tahitian government gave full support to the local people engaged in culturing these pearls.

• G.I.E. Poe Rava Nui was established in 1975 to provide reserve funds to the producers to set up their businesses (Figure 1).

• Pearl cultivation was started in 1976 and the first auction was held in 1979. This year will be the 21st year.

b) Basic system of the organization

The harvested pearls are to be delivered to GIE who will control the whole product and hold an auction each autumn at Papeete.

The GIE will value the products delivered from the producers upon receipt, and the profit acquired from the auction will be proportionally divided (Table 10 and Figure 2).

The pre-valuation is made because the products will be mixed and rearranged into saleable lots which also makes it easier for buyers to buy and promote sales, thus bringing higher prices. The GIE will take 8% of the total sales as a commission and the bank will subtract the amount for loan and interest. The remaining amount will be paid to the pearl producer as their profit.

c) Conditions to be solved in order to operate this organization efficiently

It has been 20 years since the GIE began operating, and now 80% of the producers are registered as members. However, the share of total production is still about 5%, and has shown no signs of increase. Many reasons can be given, such as:

• The government's goal to establish a national industry is not fully understood by producers. There are some producers who sell their products to buyers before the auction, and because of this, the sales amount of the auction did not reach the goal and the bank could not collect its loans and interest. The amount of pearls delivered to GIE for auction was practically same every year, which means the investment was made but pearls equivalent was not delivered. This happened in Japan too and some producers went bankrupt.

• The shortage of Japanese technicians is another reason, so there were several technicians who moved to each producer to seed the oysters. They did not have the sufficient time for the preparation process to be done before the operation, or for the aftercare routine of oysters seeded. The technicians were not able to give on-the-spot instructions and training to the local staff. Now there is a vocational school to educate local people, so they can take over in near future.

• The shortage of Japanese technicians is another reason, so there were several technicians who moved to each producer to seed the oysters. They did not have the sufficient time for the preparation process to be done before the operation, or for the aftercare routine of oysters seeded. The technicians were not able to give on-the-spot instructions and training to the local staff. Now there is a vocational school to educate local people, so they can take over in near future.

POE RAVA NUI, g.i.e GROUPEMENT DE PRODUCTEURS DES TUAMOTU-GAMBIER, ILES SOUS LE VENT - FONDE EN 1979 ADDRESS : P.O. BOX 2568 - 98 713 PAPEETE - TAHITI - FRENCH POLYNESIA - TEL. (689) 438 782 - FAX : (689) 433 167

Figure 1. G.I.E. Map of the Vast Tahitian Black-lipped Culture Pearl Farms

Table 10. Poe Rava Nui International Auctions 1981 – 1997

Table 11. Tahiti GIE Poe Rava Nui Black Pearl Auction Summary Statement (Last 8 years)

1 MOMME = 3.75 gr.

Figure 2. Tahiti Poe Rava Nui International Auctions 1990 – 1997

3.7 Transaction Flow

Approximately 75% of the products are being sold directly on private settlement basis to larger buyers coming mainly from Japan, and the market price is usually fixed on these occasions. Because of this, there is only 15–20% left for brokers to buy at auction. The auction sponsored by G.I.E. Poe Rava Nui is held in the autumn each year at Papeete. (The 1997 was its 20^th anniversary.) The merchandise displayed for sales is about 3% of the total production. They do not have any influence in setting the market price, but do play an important role to buyers, and can confirm the market price and obtain other necessary information. Three years ago, a different organization began holding an auction in March at about the same scale, and this autumn 1998, the largest producer will hold an auction in Hong Kong (other details are not available at this time).

3.8 Yearly Market Price Flow

It is commonly said among dealers that if the total production increases by two times, the trader's unit price will become half the price. Figure 3 shows fluctuations of black pearls import and price in Japan. In the case of Tahitian black pearls, the following table shows the fluctuations of these past ten years.

Black pearls imported to Japan since 1988

During these ten years, the import from Tahiti had increased to about 11 times, and the unit price dropped to about one third (but not on an average basis).

When the demand for black pearl was high in 1991, the total output was 1.8 times, but the unit price was almost same as in 1988. Whereas in 1993, when the total production increased 5 times, the unit price dropped more than half. From 1995 to 1997 (not shown on the list), the total production increased by 2 times, but the unit price was about the same. This was largely due to the efforts of the larger producers who tried to stabilize the price, but there is a limit to their efforts.

In Japan, the annual sales (weight) of silver pearls is approximately 280 Kan, which is about one third that of the black pearls. The internal supply of these two became unbalanced and this may be the saturation point of the black pearls. However, when the Japanese economic situation is restored, there may be an increased market again, especially for the pearl-loving Japanese who will want to buy higher quality and different colour variations (like gray), of black pearls.

Figure 3. 1981 – 1997 Black Pearl Import into Japan from Producing Countries