By David Gill
In the face of the higher costs for the raw materials, manufacturers of natural-fill basic bedding are ready to demand higher prices for their products, and believe that the category has entered a long-term period of upward price pressure.
Since the beginning of 2009, prices for cotton, down, feathers and polyester have all risen steeply and inexorably, according to the American Down and Feather Council and vendor executives. To set the stage:
•Cotton prices rose from 75.35 cents per pound to 85.55 cents per pound from Feb. 1 to Feb. 26, according to the International Cotton Advisory Committee. In July of last year, cotton prices on the spot market averaged 54.71 cents per pound.
•The American Down and Feather Council said prices for white goose down reached $17 to $20 per pound in March, up 30 to 40 percent from their 12-month low.
•Duck-down prices were quoted at $9 to $12 per pound last month, up 50 to 100 percent from their 12-month lows, the council added.
Steve Uretsky, president of Allied Feather and Down, noted that prices for goose down from China, the world’s chief source, are double from their low point of last year. “The reasons are, first, that after two cold winters, demand is way up,” Uretsky said. “Second, the Chinese domestic business (for goose down-filled products) is quite good. Third, Chinese farmers are keeping their inventories low in order to keep the prices high.”
It had been expected that raw-materials pricing would soften after the Chinese New Year, Feb. 14, but according to Joe Crawford, senior vice president of finance and procurement at Pacific Coast Feather, this never happened. “In fact, (cotton) shell prices, as well as down and feather prices, continued their climb immediately after the New Year ended,” Crawford said.
Crawford is among those who believe that these factors point to a long-term upward price spiral. “Birds are raised primarily for their meat, not their down and feathers,” he said. “Farmers simply do not raise more birds unless meat prices warrant it. As a result, even a significant increase in the price of down does not result in greater supply to the marketplace.”
Another who foresees continued upward price pressure is Stephen Palmer, president of United Feather & Down. Observing how demand in China has risen for down-filled products, Palmer added, “This new demand, along with increasing worldwide demand associated with improving economies, will continue to put pressure on down prices from the demand side of the equation.”
In a statement, the American Down and Feather Council predicted that these higher costs “will undoubtedly be visible on retailers’ shelves in the form of higher price points for down and feather goods. In the coming year, consumers can expect to pay more for their down comforters and pillows.”
Agreeing with the council, Crawford added that these expected higher prices at retail could have an effect on the pricing of all basic bedding, including that filled with synthetic materials. “These cost increases impact virtually all basic-bedding products and will certainly result in higher retail pricing,” he said.
Uretsky also observed that the price of oil has also firmed, which affects basic bedding from two fronts: oil as a raw material for synthetic fills such as polyester, and the shipping costs for finished bed products. “The bottom line is, prices to retailers will be higher than last year,” he said.
In conversations held during and just after last month’s New York Home Fashions Market, however, executives with basic-bedding vendors were reluctant to state publicly their actual pricing plans for this year. Their comments also indicated that pricing these products to their retail customers is a highly sensitive issue, as it has been for decades. “We’ve tried to hold the line on pricing,” said one executive, “but now we feel that we probably have no choice but to raise our prices.”