NAFA – Wild Fur Update December 24, 2013

Wild Fur Update December 24, 2013

Now that we have had the results of the Kopenhagen and Helsinki December auction sales, it is time to reflect on these results.

Mink is coming off a very high and very profitable level and it is of no surprise to many that we are seeing a decline – China’s mild weather, together with some transportation problems being the main reason. Russia all along has found the recent price levels too high for its consumers. As mentioned earlier, over the last 10 years the December and January auctions have seen the lowest prices of the season. We still have 5 weeks of important retail left in China and in our traditional markets we have cold weather which should result in higher fur retail, although this is mostly in trim.

Our ace in the hole for wild fur is the trim trade, which has, up until now had a very good selling season. Yes, we will see a reduction from last year’s very high prices, but with NAFA scheduling 3 major auctions in 2014, we have enhanced our trapper producers’ chances of maximizing their return. The increased auction schedule comes at an absolutely perfect time for all of us. Many of you will recall why we no longer hold auctions in December and January. Quite simply, the timing is wrong. Manufacturers and retailers are still selling last year’s inventory and until the current retail season is over, are not ready to purchase for the next retail season.

As it looks right now, there will be a reduction in price levels for most furs, but on the positive side, this will attract new consumers that were unable to buy furs because of last year’s high prices. The correction in the market highlights that very commercial and lower end goods will be in for a bigger decline than better qualities. We believe we will see this throughout the selling season. Good quality, well handled skins will still bring very respectable prices to our producers.

From the important designer side of the business, Diane Benedetti will be giving you an update on recent successes that the NAFA promotional arm has accomplished. Every penny spent on promotion is a penny for your future.

We have just about completed the refurbishing of our auction room where we have increased our seating capacity by 50%, which we believe we need as the fastest growing auction company in the world. NAFA’s promotional work around the world is unprecedented and will again give us the advantage that may be needed. I am sure all of us will remember how well we did in 2013, where we obtained prices that nobody could compete with. To top it off, aside from the other benefits, all NAFA Wild Fur Shippers Council members will receive a profit sharing payment of 5% of their 2013 turnover added to their February 2014 account sales.

We are offering in February a record number of farm raised mink as well as the largest, best collection of wild fur. We will again be the most attractive auction company in the world for the buyers. Nobody in the world, no matter what location, has such a unique, diversified offering of fur products. We are now the only auction company in the world selling in North America and we are very proud of it.

As the oldest and largest handlers of wild fur in the world, we accept our leadership role and take it very seriously. We have the most experienced, dedicated management team in the world. Although there may very well be a correction in price levels this year, NAFA remains confident that we will see very high clearances at acceptable prices in our February sale. For many articles like sable, fisher and wild mink, February has historically been the premier sale of the season, while for other important articles like muskrat, beaver and raccoon, the additional April sale may become an attractive venue. NAFA feels that its new selling dates will truly accommodate the changes in buying power and patterns. With all of the promotional work that we have done, wild fur is back in fashion and we look to its future with confidence.

We would like to take this opportunity to thank you for your loyalty, and to wish you and your families a very Merry Christmas and Happy New Year.

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