Industry Observation
[Naypyidaw, May 15, 2024] The global jade industry has recently focused on Myanmar, the world's primary supplier of jade roughs, which is undergoing a profound market transformation. Data indicates that since 2021, the annual extraction volume of Myanmar jade roughs has steadily declined, while international demand for high-quality jade has continued to grow. This has led to a surge of at least 30% in rough prices over the past two years, with some premium materials even doubling in value. This trend has not only reshaped the global jade supply chain but has also sparked widespread discussions within the industry regarding resource sustainability, market transparency, and geopolitical risks.
According to the latest data released by Myanmar's Ministry of Mines, the total production of jade roughs in Myanmar in 2023 was approximately 15,000 tons, a decrease of about 16.7% from 18,000 tons in 2022. The decline was particularly noticeable in key mining areas within Kachin State's Hpakant region, such as Lonkin and Maw-Sisar. U Min Aung, Chairman of the Hpakant Mining Association, stated in an interview with our publication: “The progressive depletion of veins is the primary reason, while extended rainy seasons and outdated mining equipment also limit extraction efficiency. We are striving to find new mining spots, but a significant rebound in production is unlikely in the short term.”
The direct consequence of declining production is a sharp increase in market prices. At the Myanmar Jade & Gem Emporium held in Naypyidaw this March, a 12-kilogram ice-jadeite rough with excellent clarity and vibrant green color was sold for an astonishing US$2.8 million, far exceeding market expectations. Li Ming, a veteran jade merchant from Jieyang, Guangdong, China, lamented: “It’s incredibly difficult to acquire good roughs now. Before, you could still find cost-effective pieces at the emporium, but now almost all top-grade materials are snapped up by large conglomerates and financially strong buyers, leaving less room for small and medium-sized businesses.”
Behind the price surge is a complex interplay of multiple factors. Firstly, China, as the world's largest consumer market for jade, its strong purchasing power remains the core driver of price increases. Despite economic challenges, demand for scarce luxury goods among high-net-worth individuals remains robust. Secondly, political instability within Myanmar has led to restricted mining activities in some areas and increased transportation costs, indirectly pushing up rough prices. Furthermore, increasingly stringent environmental regulations impose higher requirements on mining companies' qualifications and extraction methods, further increasing compliance costs.
In response to market changes, the industry is also actively exploring new models. Some large Chinese jewelry companies are establishing closer cooperative relationships with local Myanmar mine owners through equity investments or long-term exclusive supply agreements to ensure a stable supply of high-quality roughs. For instance, “Oriental Jade Fate” Jewelry Company, headquartered in Ruili, Yunnan, has signed a three-year rough supply framework agreement with three local Hpakant mining enterprises, with the total amount expected to exceed US$50 million.
However, market opacity remains a significant challenge hindering industry development. The valuation of jade roughs is highly specialized and risky, and information asymmetry between buyers and sellers is common. Some unscrupulous traders exploit “blind roughs” for fraud, damaging market credibility. Industry experts call for the Myanmar government to strengthen regulation, introduce more transparent trading mechanisms, such as establishing unified rough testing and grading standards, and promote online emporium models to enhance market efficiency and fairness.
Looking ahead, the Myanmar jade rough market is expected to continue to experience a supply-demand imbalance. With the gradual recovery of the global economy and the increasing luxury consumption capacity of emerging markets, the collection and investment value of jade will be further highlighted. For all stakeholders in the supply chain, balancing resource protection with market demand, addressing geopolitical risks, and building a healthier, more transparent trading environment will be crucial challenges to collectively address in the coming period.