July 24, 2015
The selling season we have just experienced has been one of the most challenging in a long time, primarily due to one of the warmest winters on record in China, Russia and Europe. The warm temperatures had an extremely negative affect on retail sales, with many retailers reporting clearances of 50% or below. As a result, ranch mink prices declined up to 70% from the record levels established the previous season. Overall, world production of ranch mink is expected to be over 70 million next season due to pelts outs, as mink farmers in many parts of the world are selling skins significantly below their cost. This will have an effect on the price of ranch mink, as well as on many of our wild fur articles, especially beaver. At the present time, although a little early to predict, we think that we will see a repeat of last year’s price levels.
Unfortunately, the mild winter hit at a time when we had reached record prices for our product, which also meant record garment prices in retail stores. The combination of warm weather and high garment prices simply made the pricing of garments unattractive to the consumer. As a result, there is a large inventory of garments, dressed and raw pelts, which at current price levels is worth substantially less than it was purchased for. As difficult as this may be, these new reduced prices will create opportunities for the next retail selling season, allowing consumers who could not afford to buy at last year’s prices to buy at the new attractive price levels in the upcoming season.
Last year’s wild fur prices declined 30-70%, depending on the article. As the season progressed and mink prices continued to decline, the challenge to maintain wild fur prices became more difficult. As a result of a lack of confidence, price levels and clearances were mostly lower in the May sale compared to the February sale. Generally, the longer haired, trimming goods performed well, with good clearances and satisfactory prices, while the short haired varieties or flatter sections that compete with a lower priced ranch mink, suffered in price and clearance. The two articles that performed extremely well all season at levels similar to the previous year were the muskrats and western coyotes. The muskrat had strong support from Korea and the western coyotes had solid support from the high end trim trade in North America and Europe.
Given normal weather conditions, we expect similar results next season, with good demand and clearances for long haired trimming articles, while shorter haired varieties and flatter sections may not perform as well. Low grades, damaged, early and late caught pelts will have little or no commercial value, and will be nearly impossible to sell. It will not be worth our producers’ time and effort to process and ship this type of merchandise and our shippers would be well advised to be selective in their hunting and trapping this coming season. In a market such as this, any inferior quality skin will be substantially discounted by the international trade simply because the cost of dressing and handling a lower grade or inferior pelt exceeds the value of the peltand therefore is not worth it for them to buy, nor for you to ship.
Remember, it is not because fur is out of fashion – it is the weather. In the grand scheme of things, these price reductions will help us attract new buyers and create support from those who previously could not afford to buy your product. As the largest wild fur auction house in the world we will continue to attract the largest buyer attendance and have most competitive auction room. Our large, uniform assortments of all wild fur varieties make us the most attractive auction for the international trade and where price levels for wild fur will be established.
The challenges that the fur industry is facing today are not new. NAFA has experienced fluctuations of this nature in the past; we have steered our way through these troubled markets before and our producers have benefitted because of our steady and experienced approach. This experience will benefit our consignors once again. These problems can be overcome with proper management and product promotion, which is so important for wild fur. We have made some significant inroads in the fashion design industry and we need to continue these efforts, despite the current weather related problems.
Together with the WFSC you have NAFA’s commitment that we will continue to work as hard as we can – we are committed to the future of the wild fur producer.
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Trappers will trap no matter the price, its in their blood.
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