Note: This is the 2013-14 Market Forecast. Click here for the 2014-15 Fur Market Forecast.
Curiosity about the fur market is common this time of year, especially among trappers who want to know what they can expect to be paid for their fur. That curiosity is even greater this year, on the heels of a stellar 2012-13 season that produced one of the best climates in which to sell raw fur in decades.
The high prices of early 2013 have more people interested in wild fur than any other time in recent memory, meaning any uncertainty about the fur market can cause huge buzz. And uncertainty is exactly what we’re getting thus far. What follows is a little background on the fur market and some notes on the latest rumors that have been flying around in recent weeks.
The Fur Market
North America is a huge producer and exporter of wild fur, relying on countries like Russia, China and Greece to purchase it. Fur in the clothing market has a variety of uses, ranging from a luxury item in some circles, to a utility in others. Luxury fur garments are sold at very high prices in the fashion world, while the common clothing buyer in many temperate regions of the world purchases fur clothing simply to keep warm.
What we know based on these simple principles is that disposable income and supply changes affect the luxury fur market, while weather and general economic conditions affect the demand for ‘utility’ fur. These factors can change quickly, and combine with speculation to produce substantial swings in fur prices.
The reality is that by the first of the year, we never really know what is going to happen in the fur market. Most trappers work all fall to catch and prepare fur without knowing what to expect for a price. That’s because fur prices are generally set by the large international fur auctions that only begin in February of each year.
The Latest Buzz
Though we never really know what to expect in the fur market, there are always early indications of what’s to come. Here’s the little bit I’ve been able to gather thus far:
Expectations are high on the heels of a stellar 2013 fur market
Several articles have appeared recently about how great the recent high fur prices have been for trappers. This may be setting up some unrealistic expectations for prices in the future. Like all relatively mature industries, the fur market is cyclical. This means high prices do not last forever. All things being equal, the forces of supply and demand will bring high prices down. Still there is a possibility that the underlying factors that drove the high prices last year could continue for some items.
Mild weather in Russia and China has slowed demand
A good portion of North America’s wild fur eventually ends up in the hands of consumers in Russia and China as utility garments, which are worn not because they are fashionable, but because they are warm. Warm weather like China and Russia have recently experienced reduces the need for fur clothes. Changes in the weather can take place overnight, though, and the market can react quickly to these.
Politics in China may be affecting their ability to import fur
Rumors have swirled recently that Chinese importers are having difficulty bringing wild fur into the country legally. This has supposedly reduced the number of Chinese fur buyers at recent ranch fur auctions and made for lower prices. The magnitude of this problem is difficult to determine. Some folks believe that in a strong market, importers will find a way to solve this problem.
Recent prices have simply gotten too high for consumers of ‘utility’ fur items
Higher prices cause most consumers to think twice about buying a product. You don’t think twice about buying milk at $3/gallon, but when that same gallon costs $8, you probably won’t be drinking milk as often. It’s the same way with the fur market, and many believe that last year’s high prices have caused some consumers to shy away from fur.
There’s More to Come…..
It’s hard to say what we’ll see in the fur market this season, but the little I’ve gathered indicates a pretty substantial dip off of last year’s record high prices. Bits and pieces of information surrounding the market are floating around everywhere this year. We’ll do our best at Trapping Today to gather those information sources into one place where you can read what’s out there and decide for yourself – at least until the February auctions, when we’ll all be experts on what the fur market’s doing as the results of the world’s biggest auctions are made public. Stay tuned!!