High gold prices, China curb Turk jewellery export

Turkey's gold jewellery sales to the United States during the Christmas season will suffer from a rise in gold prices and cheaper Chinese products, a leading Turkish gold jewellery exporter said on Tuesday.
Turkey, the world's fourth leading gold jewellery exporter, looks to traditional Christmas sales that make up a large amount total volume to boost its exports and compensate a weak performance so far this year.
Volatile gold prices, which have reduced Turkey's gold jewellery exports in the first 10 months of the year by 5.82 percent to $764 million, rose to $632 per ounce now from around $575 in mid-October.
"The correction (in sales) we were expecting in the last quarter is not there yet. There was demand for our products when the prices were below $600, but once we rose above this level the demand immediately evaporated," Goldas, a member of the board of directors Cetin Binatli, told Reuters on Tuesday. The price of gold rose to a 26-year high in May, when it peaked at $730.
Tougher competition from China also has added to Goldas's pains, knocking Turkey from its top third spot as top exporter of gold jewellery to the United States, Binatli said. "We can feel the competition of the Chinese in the US market...Previously Turkey came third behind Italy and India, but because of China we fell to fourth place," he said.
"China is a big threat. They have cheap labour and even though their quality is not very advanced, they're learning fast," Binatli said. The gold jewellery exporter sector would not reach last year's $1 billion in revenues, he said. Goldas, which exports to 45 countries, will try to increase the number of its retail stores to 65 from the present number of 42.
"We are thinking of growing by buying a chain that would be more of a retail channel than production," he said. "If the brand we buy is a strong brand we will be able to protect it, but if it's not then we will go onto the market with the Goldas brand," he said. The company also has plans to increase that number of stores to 500 within the next five years, reaching countries such as Spain, France, and England.