Tahitian pearl industry's perfect storm
Hi everyone,
Sorry to have been quiet these last few months. Been working hard on a number of different things but thought I'd peek my head in and give a general birds eye view of the situation down here. I have been asked by a number of you what's going on so I thought I'd tried to sum it the best I can.
In 2005 we experienced the lowest point of our industry up 'til that point. Prices spiraled downward to under the cost of production for most farms. Old-schoolers who hadn't been keeping up with the times closed doors and the larger, industrial operations were left standing as well as the dedicated medium and small farms. Production dropped and the following years saw pearl prices climb to a level that gave producers their confidence back so production went up again. Buyers clued in and price erosion took over again in '07, once again forcing prices below the cost of production. This time though, they didn't stop there.
All this yo-yo-ing in my eyes is the natural result of an uncontrolled market. Lack of structure leads to anarchy and the buyers, local or international, are the first to lick their chops. This isn't an accusation though, it's just what happens. I'll be the first to say that as a farmer, I am at fault for not being proactive in the change. In 2005 I did get involved but that's another post, probably in the thread about the "GIE is no longer."
The x-factor that has kept the price of pearls in a state of freefall here in Tahiti is the world economic crisis. It has made for what I think of as a "perfect storm." The downward dip of our yo-yo was given massive inertia by the world wide phenomenon of people putting their wallets away. Lean times and worry being the most frequent currency.
So this time the carnage is being taken to whole other level. The big guys are in serious trouble with reports of some of the top producers throwing in the towel. This is devastating to the industry's labor force, pushing many people back to the main island of Tahiti in search of employment. No one is sheltered from this storm but there are still people making pearls. Those who have the capacity to get away from the local market and those with rock bottom production costs (read: sketchy employers with lots of family "help").
The support of everyone on Pearl-Guide who has bought pearls either directly from me or from one of my many retailers has really been the deciding factor that has kept me in business. I am eternally grateful to Jeremy for bringing us Pearl-Guide and to all of you for supporting it. In Sarah Canizzaro's wonderful words: Thank you. More please.
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