MILAN — Russia’s troubles are wallopping the Italian fur industry.
Sales of Italian minks and fox furs plunged in 2015, as the effect of the ruble’s decline continued to sting, and oil prices — the source of much Russian wealth — continue to fall, according to exhibitors at the Mifur fair that ran here this month at Milan’s Rho Fiera grounds.
“Turmoil in Russia, Ukraine and Turkey impacts the sector a lot. Russians want to buy local products now to save money,” said Mifur president Norberto Albertalli, who also owns his own fur business, Albertalli SpA.
The presence of Russian buyers at the March edition of the fair fell 20 percent from last year’s session. Overall, fair attendance plunged, registering 9,647 versus 14,228 visitors a year ago, organizers said.
Italian fur producers saw 2015 revenue in the Italian fur trade — mainly styling, garment-making and retail sales — plummet 7.9 percent to 1.39 billion euros or $1.52 billion at current exchange, PwC reported. Dollar figures are converted at average exchange rates for the periods to which they refer.
PwC said that last year, part of the drop in fur production was due to the significant decrease in exports to Russia, which plunged 34 percent, and Ukraine, down 30 percent.
Across the board, the auction prices of luxury hides like sable fell around the world, Albertalli noted, citing a 20 to 40 percent drop in mink in 2015.
As demand slows, Italian furriers have slashed prices to accommodate their shrinking clientele in key markets like Russia, Ukraine, China, South Korea and the Middle East.
Roberto Ravizza, owner and chief executive officer of Mondialpelli, maker of Gianfranco Ferré furs and other labels, said the geopolitical situation is dire across the board.
“The world is sad. We kiss and make up one day, and the next we are at war. We need stability to grow,” Ravizza added, noting that Mondialpelli’s sales from Russia slid about 20 percent in 2015 from 2014.
Italian designer Vinicio Pajaro said that in 2014, the Russian market represented 70 percent of total sales at his namesake fashion fur company. In 2015, the Russian market represented only 50 percent.
“Europe is showing positive signs. I am starting to believe a lot in the future of the European market, but the problem with Italian stores is they make orders and then you don’t have the certainty that they will pay,” Pajaro said, noting that his sales overall fell 15 percent in 2015. “I have faith that in 2015, we will rise again.”
Robert B. Cahill, vice president of North American Fur Auctions, said prices of auctioned furs, which include mink and wild furs from the U.S. and Canada, fell about 50 percent in 2015.
“Auctions are following the fall in oil prices, almost exactly,” Cahill said.
Positive signs, he said, are evident in the sales of sportswear and merchandise geared toward a younger demographic. Parkas with fur trim have put more fur on young people today than in the past 30 years, Cahill explained, adding that NAFA, which was founded by North American trappers in 1670, sells to fashion-forward brands like Canada Goose and Moncler.
Veneto-based Diego M, which sells in stores like Saks Fifth Avenue and Bloomingdale’s in the U.S., said it is bucking the negative trend and cited rising sales in Russia.
“Our Russia sales rose 20 percent, said co-owner Manuela Bortolameolli, who runs Diego M with her husband, Diego Mazzi.
“The trick is marketing. The problem with a lot of Italian companies is that they have a great product but they don’t know how to assert themselves,” Bortolameolli said, explaining that her company advertises in glossies like the Russian editions of Elle, Vogue and Glamour. “I go to Moscow a lot and make contacts with celebrities. We are known there.”
“We are going to rebuild the Russian market,” Albertalli said. “We are going to make ourselves known at the Russian fairs. Russia is — and needs to remain — our best client. In 2017, we should return to growth.”
In terms of fall trends, Mifur staged a fashion show in Milan’s Palazzo Serbelloni, where brands like Diego M, De Carlis, Gianfranco Ferré furs and Pajaro unfurled vibrant collections amped up with yellows and blues. Mink and fox were mixed with cashmere, shearling and exotic leather hides to show fur’s increasing diversity.
“The reduction of fur prices this year is helping us buy the best,” said buyer Pechenkin Alexandr Viktorovich of Minus 30 in Novosibirsk, Russia. “So we are here. And we will return.”