So is the fur craze in the People's Republic of Bling a bubble? Of course it is: It's overheated, it could end at any moment, and everybody seems to be exposed. Except this time, Benedetti and her Canadian bosses are hoping the bubble won't blow up in their faces.
It's February auction week at NAFA's enormous headquarters and auction house near Toronto's Pearson airport-the most important week of the year. Sales over these five days will account for 55% of the company's 2009 revenues. Between the wall-to-wall display racks in the company's warehouse and the boxes of skins in the adjoining Costco-sized cold room, there are millions of animal pelts here. The timber-wolf hides, hanging from plastic ties, are bushy, frighteningly large and weirdly strokeable (the top lot will sell for $340 per skin); the lynx skins have huge paws and mottled, beautiful, snowy-orange bellies ($530). There are silver foxes, wolverines, opossums, raccoons, skunks and even squirrels, which sell for a measly $1.43 per skin.
About 430 bidders have come this year from North America, Greece, Turkey, Italy, Japan, Korea and Russia; the number's down from 500 in 2008. But the country that will almost single-handedly prop up NAFA's sales is China-200 Chinese bidders are here this week; 250 if you count Hong Kong. About a dozen sit just outside the auction room, playing poker, betting from stacks of 100-renminbi (RMB) notes and waiting for their lots to come up. The Chinese buyers have come largely for mink, which also happens to be NAFA's specialty.
While NAFA sells more wild fur than any other auction house on Earth-$45 million worth in 2008-mink is the company's mainstay. NAFA sold 5.4 million mink skins in 2008, worth $280 million. North American mink is different from the European stuff, and this, more than almost anything, gives the company its competitive advantage. The nap is shorter and finer, and the under-fur is thicker, so the pelts feel extra soft. Mink skins from North America are also lighter in weight, which makes them ideal for women's garments. North American mink sells at a 10% to 50% premium, depending on the sex, the colour-mink comes in shades from white to pearl to sapphire to black-and the quality of the fur. The top lot of black NAFA mink can sell for between $500 and $2,100 per skin. (Depending on its length, it takes between 13 and 40 skins to make a coat.)
The company's come a long way from its roots selling beaver skins to London aristocrats in the 1600s. Through much of the history of the fur trade, the Hudson's Bay Co. was the only player that mattered, and with a few exceptions-China's imperial court, for example, bought Canadian yellow sable from the 1700s on-the company focused almost entirely on markets in Europe and North America.
Then, in 1975, the animal rights movement seized on images of Eastern Canadian hunters bludgeoning harp seal pups in the Gulf of St. Lawrence; activists bearing cameras, U.S. senators and even Brigitte Bardot visited the ice floes to call attention to the annual hunt. Before long, activists were throwing paint on women in fur coats. Across the Western world, fur, whether wild or farmed, slipped from must-have to faux pas in little more than a decade.
Amid all this, Ken Thomson, who then owned HBC, began selling off corporate assets to pay down its debts. In 1986, Thomson sold the company's London-based fur auction house to Finnish Fur Sales. A group of veteran Hudson's Bay Co. managers, backed by fox and mink associations from the U.S. and Canada, bought the company's Toronto auction house, and then Hudson's Bay New York, and combined the two into NAFA.
The new enterprise started life in last place: In 1987, NAFA's first year in operation (it was still called HBC Fur Sales at the time), Kopenhagen Fur Centre sold nearly six times the number of mink that NAFA did, and the Finns weren't far behind. NAFA was even outmatched in North America: American Legend Co., based in Seattle, became known as the go-to auction for the world's best mink.
Yet business was good, for a while. Japan and Korea, oblivious to animal welfare concerns, drove fur prices to record highs. "The fur industry has never been healthier," the director of the Fur Institute of Canada, an industry group, said in 1987.