Global demand for platinum jewellery was estimated to be 620 koz, a rise of 3% year-on-year, according to a report released by the World Platinum Investment Council (WPIC). The quarterly trends report from the promotional body said there were higher retail sales in China during the quarter.

Chinese jewellery retail sales (all jewellery types) were up 4.8% year-on-year in Q1’17 according to the National Bureau of Statistics, helped by good sales over Chinese New Year and Valentine’s Day.

However, fabricator platinum demand in China has been weaker than the retail sales results probably because manufacturers remain cautious as they are expecting the market to remain challenging this year, the report said.

Chinese jewellery demand is likely to shrink further in 2017, affected by the slower economic growth and a competitive environment for consumer spending. The jewellery industry is undergoing a period of rapid change to cope with the challenging market conditions that have prevailed since 2015.

As a result of anticipated declines in China and Japan outweighing gains in India and other regions, global jewellery demand for 2017 is forecast to slip 1% (-35 koz) to 2,530 koz, WPIC said. In 2016, WPIC reported a 11% decline in global platinum jewellery sales as compared to 2015. India was one of the exceptions to the global trend, with an over 10% rise in platinum jewellery demand in 2016.

The report also projects that jewellery recycling is projected to decline by 20% (-125 koz) to 500 koz this year as it returns to a more normal level in China after unusually large retail stock was returned to manufacturers last year.