Kopenhagen Fur auction now in spotlight

SANDY PARKER REPORT, VOL. 32, ISSUE 45, FEBRUARY 2, 2009
The following extract is reproduced with permission from Sandy Parker Reports, Weekly International Fur News. Sandy Parker has been covering the fur industry for more than four decades. For most of that time he has published a weekly newsletter, detailing results of international pelt auctions, wholesale price trends, business developments and movements in the trade, as well as economic and political activities that may impact on it.
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International Fur News
with Sandy Parker
Kopenhagen Fur auction now in spotlight
THE EYES OF THE INTERNATIONAL FUR TRADE WILL BE FOCUSED on the auction at Kopenhagen Fur this week, looking for clues to this year’s price structure and, in turn, the worth of their inventories. And virtually everybody has inventory and not looking forward to marking it down. Retailers have taken earlier and steeper markdowns than usual on their sales in anticipation of lower replacement costs, but still would not welcome a price collapse at the skin level, nor would manufacturers and certainly not the world’s mink ranchers. In previous articles, SPR used $40 as a break-even price for U.S. mink ranchers, but we have been advised that the costs are now between $50 and $55, mainly because of steep rises in feed costs. This would mean that a 20% drop from last year’s $65.70 record average would barely cover costs, especially when auction and other fees are deducted.
THE GENERAL EXPECTATION IS THAT MINK PRICES WILL FALL as a result of world economic conditions, consumer belt-tightening at the retail level and lower exchange rates against the dollar, in which most of the international fur trade is conducted. How much they may fall will be determined by two main factors: What buyers are willing to pay based on their assessment of their own markets and where the sellers draw the line below which they will not sell. At presstime, there was no indication as to what Kopenhagen’s policy would be, but some buyers were assuming the auction house would at least take the exchange rates into consideration. Since last year, the dollar has gained more than 15% against the Danish krone.
At its opening sale in December, Kopenhagen allowed prices to decline about 20%, but managed to sell only about 20% of the offering.
IN THIS ISSUE:
January Salvaged by Cold Temps
Early Price Cuts Shrink Margins
Kopenhagen Now in Spotlight
Consumer Confidence at New Low
Andriana Owner Facing Jail Term
For extracts from back issues of Sandy Parker Reports see News Index. Subscribers can access an archive of complete issues at www.sandyparker.com.
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