Japan continues to experience cold winter days, but every year around this time, auctions for freshly harvested Akoya pearls take place.
In mid-January, auctions for first-class two-year-old pearls and then semi-first-class pearls are held. In February, auctions for first-class one-year-old pearls, followed by semi-first-class and second-class pearls, take place.
The first-class auctions last for about two to three days, semi-first-class for a similar duration, and second-class for about four days. In March, second-class auctions are held regardless of whether the pearls are one-year or two-year-old.
To put it simply, first-class pearls are of the highest quality, semi-first-class are slightly lower in quality, and second-class pearls in February are of lower quality than those. However, even second-class pearls sold in February, when made into necklaces, are considered quite high-end in general retail stores. Therefore, first-class pearls are of an exceptionally high standard.
As for the blue baroque pearls I handle, they finally qualify for auction in the second-class category in February or the lower-ranked second-class auctions in March. At pearl auctions, round pearls are prioritized, and baroque pearls are automatically classified as second-class.
That said, even second-class baroque pearls can have luster that rivals first-class pearls. The only reason they are classified as second-class is due to their irregular shape.
Pearl prices fluctuate annually, much like other agricultural, forestry, and fishery products, or commodities such as rice, gold, and platinum.
Until around 2022, pearl prices remained relatively stable at a low level. When I entered the pearl industry in 2014, the market was fairly consistent, making it easier for me to learn about pearl quality and valuation. However, in 2022 or 2023, a surge in demand from Chinese buyers caused pearl prices to skyrocket.
For instance, if a first-class 7mm pearl was previously priced at $10 per piece, by the 2024 auctions, its price had soared to $50. When such inflation occurs in the auctions for freshly harvested pearls, the prices rise significantly by the time they pass through wholesalers and processors to reach retail stores.
A 7mm pearl necklace typically consists of about 57 pearls. If each pearl was originally $10, the total cost would be $570. Since the retail price is generally four times the auction price, the final price would be approximately $2,280. This pricing pattern remained consistent for about ten years. However, by 2024, with each 7mm pearl priced at $50, a necklace would cost $2,850 at auction, leading to a retail price of about $11,400. These are hypothetical figures, but they illustrate the drastic price increase.
In reality, even high-quality 7mm pearl necklaces used to retail for around $1,700. Now, the previous retail price has become equivalent to today’s wholesale price.
According to pearl industry professionals and pearl farmers, this year’s auction prices have dropped by more than 60%. While a 60% decline sounds drastic, prices still remain higher than pre-surge levels. The pearl price boom of 2023–2024 was one of the most significant in the Akoya pearl industry’s 100-year history. As someone who also purchases pearls, I feel honored to have witnessed this historic moment in the auctions.
To summarize, pearl prices have finally begun to decline. While this is not good news for pearl farmers, many are satisfied as they reaped substantial profits over the past two years. They also anticipated that such extreme price surges wouldn’t last long. However, this price drop will not immediately reflect in retail prices.
It takes more than six months to process harvested pearls. Pearls purchased at the auctions in early January typically become necklaces by autumn. As they pass from major wholesalers to various businesses before reaching retail stores, the earliest impact on retail prices will be in autumn, or even next year. Additionally, pearl businesses try to prevent prices from crashing, so it may take six months to a year for the auction price drops to be fully reflected.
Personally, I hope pearl prices return to previous levels, as I would love to purchase more pearls from suppliers once they do.
One of the most common questions I receive about auctions is: “Can my company participate in the first-class pearl auctions?” However, only a select few pearl businesses approved by organizations like the Japan Pearl Promotion Society are permitted to join. These auctions are limited to Japan’s most prestigious pearl companies. The list of participating companies varies between the first-class, semi-first-class, and second-class auctions. If the auctions were open to everyone, prices could skyrocket further—or conversely, prices could collapse. The reasons behind these restrictions remain unclear, but ultimately, only select businesses can participate.
Today is Thursday, February 20, 2025. By tomorrow night, I will return home to Kobe. Last week, I visited my family home, but this week, I plan to fully immerse myself in pearls. Just thinking about it excites me. I want to make pearl necklaces, create something through metalworking, and update my website—I have so many things I want to do. I will decide what to focus on based on my mood at the time.
Now, it’s past 11 PM, and I’m starting to feel sleepy. I always intend to be in bed by 10 PM, but I usually end up sleeping between midnight and 1 AM. I wake up at 6 AM.
I wonder—do pearls inside cultured Akoya oysters sleep or stay awake?
Rather than dismissing the thought as silly, let’s all use our imagination for a moment.
Good night to those heading to bed. And for those starting their day—have a wonderful one!
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