Cashmere demand may decrease as tourism shrinks
1 сар, 3 долоо хоног өмнө
- 41 percent of the entities expect the cashmere price to be more than MNT 50,000-70,000
The luxury product industry is on the brink of crisis as the economic outlook started to falter in 2020. The demand for washed and combed cashmere fiber is likely to decrease in Mongolia as the COVID-19 restrictions affect the tourism industry. During the financial crisis in 2009 and 2015-2016, raw cashmere price dropped by 24-25 percent and combed cashmere fiber declined by 30-31 percent respectively. This can be seen in this year, posing risk to the industry. According to research conducted among the cashmere industry, 41 percent of the entities expect the cashmere price to be more than MNT 50,000-70,000 while 18 percent of the participants assume it to be higher than MNT 90,000. However, the Mongolian National Chamber of Commerce and Industry (MNCCI) estimates the cashmere wool price to be around MNT 60,000 based on the current situation, which might show the same result as the 2009 financial crisis. MNCC included over 50 cashmere entities in Mongolia. Approximately 24,000 tons of cashmere is been produced around the world a year. Of these, China supplies 50 percent of it or 12,000 tons and Mongolia exports 40 percent or 9,600 tons of cashmere. Last year, Mongolia exported 100 percent of its washed cashmere wool to China, 85 percent of its combed cashmere to Italy, and the rest to the UK and Korea.