Else than just Mines..

Apart from being one of the top successful diamond mining hubs, Canada is also a growing market for gems and jewellery owing to good number of foreign residents. Kunjal Karaniya highlights few aspects of this beautiful nation.

TRENDS
According to Euromonitor, Canada's growing population of foreign residents and international visitors from China drove significant investment and the expansion of globally-renowned brands in fine jewellery in Canada in 2015 and 2016. Vancouver and Toronto were the primary target areas for expansion, as Asian-Canadians now represent 15 per cent of Vancouver’s population and roughly 10percent of Toronto. The renowned Chinese luxury jeweller Lao Feng Xiang opened its first Canadian location in Vancouver in 2015, citing the strong Asian population as a driver for the company’s expansion strategy. Luk Fook Group opened its largest overseas location in the Markville Shopping Centre in Toronto in early 2016, drawn to the almost one million Chinese residents in the area. Visitors from key target markets for the jewellery segment, suchas China, are reported to have reached 9per cent growth in the first nine months of 2015 over 2014, whilst visitors from South Korea reached 16per cent and Japan reached 6per cent .

COMPETITIVE LANDSCAPE
According to IBIS World, the Jewellery Stores industry in Canada has experienced a period of moderate growth over the past five years. Improved consumer sentiment, increasing per capita disposable income, easy availability of credit and an increase in the net worth of households across Canada have driven and sustained growth in industry revenue over this period. In the coming years, increasing concentration and stable commodity prices, along with stable demand for industry products, is anticipated to improve profitability.

Zale Canada maintained its leading position in jewellery in Canada in 2015, despite seeing its sales decline from C$228 million to C$227 million. Zale Canada offers a wide variety of jewellery, including engagement rings, necklaces, earrings and bracelets, which feature diamonds, precious and semiprecious stones. The company also sells a variety of collections with jewellery inspired by designers such as Vera Wang and celebrities such as Shaquille O’Neal, the famous NBA basketball star. Zale Canada is expected to maintain its lead in jewellery in Canada, but its most direct competitor, Pandora Canada, is expected to see a positive performance in 2016, states Euromonitor.

The recent influx of luxury brands and department stores is expected to significantly elevate the retail landscape in Canada, adding further incentive for growth in luxury shopping tourism for the country throughout 2016-2021. Euromonitor International estimates inbound trips by Chinese tourists, a key market segment for sales of fine jewellery, to grow by 3per cent by 2019, and overall inbound trips to grow by a CAGR of 2per cent from 2016-2020.

The number of foreigners taking up residence in Canada is expected to grow by 24per cent from 2015-2030, making up nearly 7per cent of the population by 2030. Vancouver and Toronto are expected to continue to capture the majority of this growth, creating strong opportunity for jewellery retailers to prosper in these cities.

In Canada, the retail sales of jewellery, watches, and accessories are forecast to deliver a CAGR of 4.42per cent during 2015-2020, to reach a market value of CAD7.7 billion by 2020. The outlook for the jewellery, watches, and accessories market seems positive over the forecast period.

DIAMOND MINING:
Canada first became a diamond producer in 1998, when the Ekati diamond mine opened in the Northwest Territories. By 2006, three major mines were producing over 13 million carats of gem-quality diamonds per year. This placed Canada as the third largest producer of diamonds in the world. Ekati’s average production over its projected 20-year life is expected to be 3 to 5 million carats per year—about 3per cent of world diamond production by volume.

The Canadian diamond mining industry employs about 2,650 people in mine operations and another 1,500 in support industries, such as maintenance, catering, and transport Indigenous persons generally make up 30-40per cent of the mining work force.

The activity associated with the production of diamonds brought billions of dollars in commerce to the economy of the Canadian North.

In recent years, Canada has been one of the top three diamond-producing countries in the world on the basis of carats produced. The Diavik and EKATI mines are expected to close during the next few years. Hopefully, new mines at Gahcho Kué, Renard, and Chidliak will help Canada remain one of the world’s leading producers of gem-quality diamonds.

FACTS ABOUT GEMS & JEWELLERY INDUSTRY OF CANADA
Jewellery, watches and accessories accounts for 1.82per cent of the total retail sales in Canada. - Sales through online channel stood at 8.9per cent of the total sales in the sector in 2015 and are expected to reach 14.8per cent by 2020. - Per capita spending on jewellery, watches, and accessories will show growth of 3.47per cent over the next five years.