Copyright farmersweekly
Reading Time: 2 minutes The new velvet season has got off to a “complicated start” with velvet producers encouraged to closely weigh up their selling options and look to partner with operators with skin in the game. Speaking on a recent deer industry markets update webinar, Deer Industry New Zealand (DINZ) board director Tony Cochrane said: “Where we sit right now, we don’t have a price, similar to most velvet operators in NZ.” Cochrane noted that stocks are currently built up in NZ’s overseas markets, particularly China, and that volatility is starting to show. “This sets up the 2025-2026 velvet season as another complicated one.” DINZ chief executive Rhys Griffiths concurred, saying prices are coming later than usual. “Throw in an early spring weather event for some of our producers, and we feel for farmers given the additional uncertainty,” Griffiths said. “As always, our advice remains the same: stick close to your buyers, weigh up your options closely, look to partner with those operators with skin in the game, and keep an eye out for DINZ updates.” While this time of year is always something of a game of whispers, with the usual pre-season posturing in the market, there are reports of some margin traders again trying to drive down prices at the wholesale end. On the demand side, South Korea, in the past driven by a booming health food market, has slowed due to the country’s economic headwinds, leading consumers to seek out less expensive substitutes, such as probiotics and vitamin supplements. The health food sector is slowing due to a glut of products in the market, meaning more consumer choice and, while health functional foods (HFFs) is a promising product category, the reality is that it will take a couple of years for volumes to lift. Which leaves China, where there are currently already stocks of Korean-grade velvet awaiting processing. End use demand in China is growing, albeit slowly, but brings with it different preferences for velvet, based on a several factors, including traditional opinions on what makes “good” velvet, as well as the ease of processing and associated processing costs. Cochrane said the control of NZ velvet still rests in the hands of velvet growers to achieve fair value and not be led down a negative pathway by short-sighted buyers. “Farmers are now cutting rounder, shorter velvet and culling stags based on quality to balance supply and demand, which is going to have a positive impact going forward. “Velvet is a niche, high-value product, not a commodity that can be easily replicated.” November will see visiting delegations from several pharmaceutical companies from both South Korea and China. “So there is certainly investment interest in the future of NZ velvet as a hero ingredient, but these visits and this interest won’t influence the current season.” While mid-to-long term developments will see NZ velvet’s full potential realised – at the earliest for the 2026-2027 season – right now the sector is facing demand shifts outside of its control. DINZ said it is focusing on what it can control to give the NZ velvet producer more protection against “rogue trading”.
