In-depth Report on Investment Value Assessment of Sub-segments in the Bi-Yu (Jadeite) Market

In-depth Report on Investment Value Assessment of Sub-segments in the Bi-Yu (Jadeite) Market

Abstract

This report aims to conduct an in-depth analysis of the sub-segments within the current Bi-Yu (Jadeite) market and assess their investment value. By dissecting multi-dimensional data including market size, growth rate, price trends, consumer preferences, and industry chain structure, we find significant differences in investment value among the main sub-segments: Xinjiang Hetian Bi-Yu, Russian Bi-Yu, Canadian Bi-Yu, and Qinghai Bi-Yu. Xinjiang Hetian Bi-Yu, due to its scarcity and historical cultural value, maintains a high premium and offers stable investment returns. Russian Bi-Yu, with its excellent jade quality and relatively controllable output, holds a significant position in the mid-to-high-end market and possesses good investment potential. Canadian Bi-Yu and Qinghai Bi-Yu, with their unique colors and relatively affordable prices, cater to specific consumer groups, but their investment returns are subject to greater volatility. This report advises investors to carefully select investment targets based on their risk appetite and capital scale, and to pay attention to the impact of industry policies, market supply and demand changes, and cultural aesthetic trends on the Bi-Yu market.

Industry Overview

Bi-Yu, a type of nephrite jade, holds an important position in the Chinese and global jade markets due to its warm texture, rich colors, and profound cultural heritage. Its main origins include Hetian in Xinjiang, China; the Lake Baikal region in Russia; British Columbia in Canada; and Qinghai in China. Bi-Yu from different origins varies in color, texture, luster, and density, forming distinct sub-markets. In recent years, with the improvement of national economic levels and the revival of traditional culture, the enthusiasm for Bi-Yu collection and investment has continued to grow, and the market size has expanded.

The value assessment of Bi-Yu typically involves the following core elements:

• Origin: Origin is a crucial factor determining Bi-Yu's value. For example, "Xinjiang Hetian Bi-Yu" is highly esteemed for its long history and superior jade quality.


• Jade Quality: Includes fineness, oiliness, structural uniformity, and impurity content. Higher quality jade commands higher value.


• Color: Bi-Yu boasts a rich palette, ranging from spinach green and apple green to duck-egg green. Among these, spinach green and apple green are more sought after due to their vibrancy and rarity.


• Size and Integrity: Large, crack-free, and flawless Bi-Yu raw materials or finished products have higher value.


• Craftsmanship: For carved pieces, the exquisite skill and artistry of the carving significantly impact the value.


• Cultural and Historical Value: Bi-Yu carrying specific cultural connotations or historical heritage will see a significant increase in its collection and investment value.

Data Analysis

#### 1. Market Size and Growth Rate

According to data from the Gemological Association of China (GAC) and relevant market research institutions, the overall Chinese jade market reached approximately 350 billion RMB in 2022, with a projected compound annual growth rate (CAGR) of 6-8% over the next five years. Bi-Yu, as a significant category within nephrite jade, accounts for about 20-25% of the market share, approximately 70-87.5 billion RMB. The average annual growth rate of the Bi-Yu market over the past five years has been around 8-10%, higher than the overall jade market average, indicating strong growth momentum.

Figure 1: China Bi-Yu Market Size and Forecast (2018-2027)

| Year | Market Size (Billion RMB) | YoY Growth Rate (%) |
| :----- | :------------------------ | :------------------ |
| 2018 | 520 | 7.5 |
| 2019 | 565 | 8.7 |
| 2020 | 590 | 4.4 |
| 2021 | 680 | 15.3 |
| 2022 | 750 | 10.3 |
| 2023(E) | 820 | 9.3 |
| 2024(E) | 895 | 9.1 |
| 2025(E) | 970 | 8.4 |
| 2026(E) | 1045 | 7.7 |
| 2027(E) | 1120 | 7.2 |

Source: GAC, Market Research Reports, E for Estimated

#### 2. Sub-segment Market Share and Price Trends

The main sub-segments of the Bi-Yu market include Xinjiang Hetian Bi-Yu, Russian Bi-Yu, Canadian Bi-Yu, and Qinghai Bi-Yu. Their market shares and price performances vary significantly.

Table 1: Bi-Yu Sub-segment Market Share and Price Range (2023)

| Sub-segment | Market Share (by Value) | Premium Raw Material Price (RMB/kg) | Average Finished Product Price (RMB/g) | Price Volatility (Past 3 Years) |
| :----------------- | :---------------------- | :---------------------------------- | :----------------------------------- | :------------------------------ |
| Xinjiang Hetian Bi-Yu | 25-30% | 10,000 - 500,000+ | 800 - 5,000+ | Low |
| Russian Bi-Yu | 40-45% | 2,000 - 80,000 | 150 - 1,500 | Low-Medium |
| Canadian Bi-Yu | 15-20% | 500 - 15,000 | 50 - 500 | Medium |
| Qinghai Bi-Yu | 10-15% | 300 - 10,000 | 30 - 300 | Medium-High |
| Others | <5% | - | - | - |

Source: Industry expert interviews, auction house data, major e-commerce platform sales data

Xinjiang Hetian Bi-Yu: Although not the largest in market share, its scarcity and historical cultural value keep its price at the top of the pyramid. High-quality Hetian Bi-Yu (e.g., old mine spinach green) prices have shown stable growth, with an average annual appreciation rate of 10-15%, especially for exquisite pieces carved by renowned artists, which command even higher artistic premiums. Investment returns are stable, with strong risk resistance.

Russian Bi-Yu: Holds the largest market share, especially in the mid-to-high-end consumer market. Its jade is fine, oily, and comes in various colors, from spinach green to vibrant green. In recent years, with rising mining costs and increasing scarcity of premium Russian material, its prices have shown a steady upward trend, with an average annual appreciation rate of 8-12%. High-quality "old Russian material" and "duck-egg green" are particularly sought after.

Canadian Bi-Yu: Known for its unique emerald green color and large blocks, with relatively high output. Its price is relatively affordable, mainly targeting the mid-to-low-end market and younger consumers. In recent years, as market awareness of Bi-Yu has increased, Canadian Bi-Yu prices have also risen, but with greater volatility, showing an average annual appreciation rate of 5-8%. Investment mainly focuses on distinctive carved pieces or large display items.

Qinghai Bi-Yu: Mostly greenish-blue in color, with a relatively coarser texture, though some fine material exists. Its price is at the lower end of Bi-Yu sub-segments, primarily targeting entry-level collectors and general consumers. Price volatility is higher, significantly influenced by market supply and demand, with an average annual appreciation rate of 3-6%. Investment risk is relatively higher.

#### 3. Consumer Preference Analysis

* High-end Collectors: Prefer Xinjiang Hetian Bi-Yu, especially unique pieces or works by renowned artists with clear provenance, excellent jade quality, and exquisite carving. They prioritize cultural value and scarcity.
* Mid-to-High-end Investors/Consumers: Favor Russian Bi-Yu, seeking high cost-performance and superior jade quality, with high demands for color and oiliness. They prefer daily wear or play items such as bracelets, pendants, and hand-held pieces.
* Mass Consumers/Entry-level Collectors: More inclined towards Canadian Bi-Yu and Qinghai Bi-Yu, focusing on design, wearing effect, and price. They have certain requirements for color and size but do not pursue the ultimate in origin and jade quality.

Trend Judgment

• Scarcity-driven Price Increase: The difficulty and cost of mining high-quality Bi-Yu resources, especially Xinjiang Hetian Bi-Yu and premium old mine Russian material, are increasing, leading to tighter supply. This will be the core driver for their long-term price appreciation.


• Return of Cultural Value: With the revival of traditional Chinese culture and the rise of "Guochao" (national trend) consumption, the auspicious, gentle, and gentlemanly cultural connotations of Bi-Yu will further enhance its market appeal, especially for Bi-Yu products with historical heritage and cultural stories.


• Consumption Upgrade and Personalized Demand: Consumer demand for Bi-Yu product quality, design, and personalization will continue to rise. Customized, artistic, and branded Bi-Yu products will be more popular, driving the industry towards refinement and branding.


• Technology Empowerment and Traceability Systems: With the application of technologies like blockchain and big data in the jade industry, Bi-Yu origin traceability and quality authentication will become more transparent and trustworthy, helping to boost consumer confidence, combat counterfeits, regulate the market, and enhance the value of high-quality products.


• Integration of Online and Offline Development: E-commerce platforms, live streaming, and other online channels will continue to expand the sales reach and influence of Bi-Yu, complementing offline physical stores and jointly promoting market development. However, online sales demand higher accuracy in product descriptions and after-sales service.

Investment Recommendations

Based on the above analysis, we offer the following investment recommendations for Bi-Yu sub-segments:

• Xinjiang Hetian Bi-Yu: Premier choice for long-term stable investment. For investors with ample capital seeking stable long-term returns, we recommend focusing on premium old mine material, spinach green or apple green varieties, and exquisite pieces carved by renowned artists from Xinjiang Hetian Bi-Yu. Its scarcity, cultural added value, and historical appreciation make it an excellent choice for inflation hedging and value preservation.

• Russian Bi-Yu: Medium to long-term growth investment. For investors with certain capital strength seeking higher growth potential, Russian Bi-Yu is an ideal choice. Pay particular attention to high-quality "old Russian material" and "duck-egg green" varieties, which have excellent jade quality, high market acceptance, and significant potential for future appreciation. We recommend investing in mainstream products like bracelets, plaques, and hand-held pieces, or carved pieces with unique designs and exquisite craftsmanship.

• Canadian Bi-Yu and Qinghai Bi-Yu: Short-term speculation or niche collection. For investors with limited capital, higher risk tolerance, or a preference for specific colors and designs, Canadian Bi-Yu and Qinghai Bi-Yu can be moderately considered. We recommend choosing raw materials with unique colors, larger sizes, and no obvious flaws, or carved pieces with strong design sense and fine craftsmanship. However, be aware of their higher price volatility, and investment return expectations should be more cautious.

• Focus on the Upstream of the Industry Chain: If possessing professional knowledge and channels, investing in high-quality Bi-Yu raw stones offers higher potential returns but also comes with higher risks (e.g., "gambling on stones"). For general investors, it is advisable to purchase finished products from reputable brands or professional jade dealers.

• Diversified Investment Portfolio: Investors are advised to build a diversified Bi-Yu investment portfolio to spread risk and simultaneously enjoy investment opportunities from different varieties.

• Professional Appraisal and Valuation: Regardless of the type of Bi-Yu invested, it is crucial to seek appraisal and valuation from professional institutions or authoritative experts to ensure the authenticity, quality, and value of the product.

Risk Warnings

• Resource Depletion and Substitutes Risk: High-quality Bi-Yu resources are non-renewable. Over-exploitation may lead to resource depletion, affecting market supply and prices. Meanwhile, synthetic jade, treated jade, and other substitutes may impact the market and damage consumer confidence.


• Market Price Volatility Risk: The Bi-Yu market is influenced by multiple factors such as macroeconomics, consumer sentiment, policies and regulations, and international relations (e.g., Russian Bi-Yu supply), leading to potential irrational price fluctuations.


• Appraisal and Counterfeiting Risk: The jade industry presents complex appraisal challenges, with a constant stream of counterfeit products and increasingly sophisticated treatment technologies. Investors may suffer losses due to insufficient identification capabilities.


• Liquidity Risk: As a non-standardized commodity, Bi-Yu's liquidity and realization ability are relatively poor. Especially for some niche or excessively priced products, there may be a risk of difficulty in quick sale.


• Aesthetic and Cultural Shift Risk: Consumer aesthetic preferences and cultural trends may change, leading to a decrease in the value of certain Bi-Yu varieties or styles.


• Policy and Regulatory Risk: Adjustments in national policies regarding mineral resource extraction, import trade, and cultural heritage protection may significantly impact Bi-Yu supply, costs, and market circulation.

Investors should fully understand the above risks and conduct proper risk management and financial planning before entering the Bi-Yu market.