Wild Fur Market Update
January 14, 2015
Our wild fur market needs to be split into three categories: the Trimming market; the Asian market and the Russian market.
Trimming Market
The fashion industry has not only embraced fur as trim on down and textile jackets, but also in the accessory business, with strips of fur on boots, gloves, hats, purses, scarves, etc. This business remains very strong for the articles that can be used for this purpose in North America, Asia, and parts of Europe. While heavy Western Coyotes and better quality heavy Red Fox lead the way, western heavy raccoon, fisher, and other long hair articles also contribute.
Russian Market
One year ago, it took 32 Russian rubles to buy $1 U.S. and money could easily be transferred from Russia to NAFA for their purchases. Today it costs the Russians approximately 65 rubles to purchase $1 U.S. and it is much more difficult to transfer money out of Russia to NAFA due to the political and economic problems in Russia. Inside Russia, luxury goods, including fur, are selling very well in rubles. Most of the fur garments in Russia are manufactured outside, in either China or Greece. In the case of wild fur, most of it comes from NAFA. The heavy Raccoons and Western sections are also used for trimming, while Eastern sections, smaller sizes and flatter goods are used more for jackets. It is this last group that most likely will have less demand. Looking ahead for the year, the articles that are dependent on Russian retail will obviously be affected, but we don’t know to what extent. Fur is in fashion and the demand is strong.
Asian Market
Fur retail in the markets of China and Korea are doing well and the number one article is a short nap North American and European mink. The exports of wild fur garments and trim out of china has grown significantly over the past few years and although we are promoting wild fur extensively with 6 permanent staff in Asia the domestic use of wild fur in China is still in it’s infancy. Korea, have been active in the better end of the Lynx, Lynx Cat and Sables and are doing well. Although the Koreans were major buyers of better quality and large size Muskrats over the last couple of years, it would appear that they will be less active this upcoming season. Without this competition from Korea, muskrats prices, which did incredibly well last season , will sell at lower levels reflecting the huge decline in ranch mink prices last season.
Marketing and Promotion
Michael Mengar, Rob Cahill and Diane Benedetti are currently in Beijing at the Beijing Fur Fair, which is an export fair of mostly accessories and cheaper quality fur pieces and garments. Weather conditions in China were favourable for most of December and Chinese New Year is not until February 18. Although some sales will continue after Chinese New Year. It is during this period of time where retail is heaviest so we have another 4 weeks of sales to go.
Overall, the upcoming auction season is going to be a tough one in some articles that are affected by the Russian problems, but your auction company is doing everything it possibly can to make sure that we manage the sales to our best ability, using all of our past experiences. In order to encourage the buyers to purchase in our January auction, we have extended our terms for full payment until April 15, 2015. We are asking the buyers to pay us a 35% deposit on Prompt Date and there will be no charges, interest or any other, until April 15, 2015. However, all of our shippers will be paid in full on the Prompt Date of the January sale, which is February 23, 2015.
Today’s rate of exchange: $1.00 U.S. = $1.19 Cdn.
A report on the Beijing Fur Fair will be posted tomorrow. Early reports indicate that it was better than expected.
http://www.nafa.ca/16818
NAFA Update - January 14, 2015
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