Liangshan Southern Red Agate Raw Material Supply Tightens, Market Prices Poised for Another Surge
Liangshan, Sichuan, October 26, 2023 – Recent developments in the core mining areas of Liangshan Southern Red Agate in Sichuan have drawn significant attention from the industry. According to an in-depth investigation by our reporter in the production areas, the output of high-quality Southern Red Agate raw materials is showing a notable decline. This tightening supply is creating increasing pressure on the market, signaling that Southern Red Agate prices may be on the verge of another upward cycle.
Southern Red Agate, revered for its warm texture, rich color, and rarity, holds a pivotal position in Chinese jade culture. The Liangshan region, as one of China's most important Southern Red Agate producing areas, directly influences the global market landscape. In recent years, driven by a surge in collecting enthusiasm, the market size of Southern Red Agate has continuously expanded. According to incomplete statistics, the total transaction volume of the Chinese Southern Red Agate market exceeded 5 billion RMB in 2022, with the Liangshan region contributing over 60% of the high-quality raw materials.
However, behind this prosperity lies the grim reality of increasingly depleted resources. Professor Zhang Hua, a senior jade appraisal expert and director of the Gems & Jewelry Trade Association of China, stated in an interview with our newspaper: “The non-renewable nature of natural resources dictates the scarcity of Southern Red Agate. After years of intensive mining in the Liangshan area, surface and easily accessible veins have largely been exhausted. The difficulty of mining is now escalating, and the exploration and extraction costs for deeper veins are increasing exponentially, directly leading to a sharp reduction in the output of premium raw materials.”
During visits to the mining areas, our reporter learned that the proportion of raw materials reaching collectible grade has dropped from approximately 15% in previous years to less than 5% currently. Many miners reported that high-quality rough stones, such as 'persimmon red' and 'cherry red,' which were once common, are now extremely rare, replaced by more ordinary-grade materials. Li Ming, a mine owner who has worked in the area for over a decade, expressed his frustration: “Now, we might dig for a whole day and not find a single decent piece. Costs are rising, but profits are shrinking, and many small mine owners are struggling to stay afloat.”
Market analysts point out that the tightening raw material supply will inevitably be passed on to the end market. It is anticipated that within the next 6-12 months, the prices of finished Southern Red Agate products will see a general increase of 15%-30%, with high-quality cabochons, bead strings, and carvings potentially experiencing even higher surges. Currently, prices for high-quality Liangshan Southern Red Agate bracelets (10mm diameter) have generally risen by about 10%-15% since the beginning of the year, while exquisite carvings have seen increases of over 20%.
In response to this trend, new strategies are emerging within the industry. Some large jewelry companies and workshops are actively seeking new sources of raw materials or focusing on optimizing design and processing techniques to enhance the added value of existing materials. Simultaneously, for consumers and collectors, this is undoubtedly a period to re-evaluate the investment value of Southern Red Agate. Professor Zhang Hua advises: “Against the backdrop of increasing resource scarcity, truly high-quality Southern Red Agate will possess greater potential for preservation and appreciation of value. Investors should prioritize quality, choosing reliable sources and exquisitely crafted pieces, rather than blindly following trends.”
Looking ahead, the mining of Liangshan Southern Red Agate is expected to become more standardized and sustainable. Government departments may introduce stricter mining policies to protect this precious natural resource. At that time, the Southern Red Agate market will shift from quantitative expansion to qualitative improvement, with refinement and scarcity becoming key factors driving market trends.