To inform company decision-making and accountability towards stakeholders, Saga Furs has conducted a mini stakeholder engagement with Baltic field representatives for an update on fur farmer supplier attitudes to sustainable farming practices.
Lithuanians, Paulius Gabinaitis and Donatas Cepaitis, make multiple visits annually to the more than 100 Saga Furs’ supplier farms based in the Baltic. Both confirm that investment into sustainability in recent years has been high but prices for quality fur remain low and farmers are still waiting anxiously for returns.
“Up until about four years ago there was double the amount of farms in the market,” explains Gabinaitis. “Prices were high and margins were very profitable.”
Many farmers at that time were business owners, outsourcing their operations to farm managers but with no personal interest in the operations, apart from getting rich.
“They were getting financing,” Cepaitis recalls, “but part of the money wasn’t being used properly.” Then fur prices began to dip and national laws tightened. The poor quality farms immediately began to fall away. “200 farms quickly became 100 farms.”
Getting ready for Welfur
Those committed farmers remaining have invested in the new European scientific animal assessment protocol called Welfur, of which Saga Furs is a lead sponsor. Welfur farm upgrades include installing larger cages, with only two minks per cage, as well as stricter attention to animal welfare at every aspect of animal lifecycles.
Both Gabinaitis and Cepaitis concur that some farmers are even going beyond set requirements. For example Welfur requires a small toy for each animal, but farmers are adding special shelves, drinking cups and other playthings for extra animal enrichment.
“Now, when the auditors come to Lithuania and Latvia we hear comments like: ‘Such nice farms!’ ‘Quality is superb,’ or, ‘The animals are obviously well cared for.’”
Open farms promote understanding
Farmers are also more willing to show off their efforts to their local communities, with regular open farm days becoming the new normal.
“Our farmers have got much more open about engaging with local families, children and schools.”
Gabinaitis recently had a personal experience of his own with a school farm visit. In Lithuania, at the Montessori school, his daughter and son had suffered from a class activity where students shared parents’ occupations.
“My daughter was told by classmates that her father was an animal killer.” Gabinaitis recalls. “My daughter became very unhappy and this worried me.”
When Gabinaitis confided in Ceslovas Tallat-Kelpsa Head of the Lithuanian Fur Association and high profile advisor to the national government, Ceslovas immediately handed him a solution. It involved a big box of ice-cream and a school bus.
“We invited all 64 children and their teachers on a day trip to a fur farm,” Gabinaitis recalls. “It was May and the new mink kits had just been born.”
During the visit, they engaged with the animals and the farmer, including cuddled the mink kits and having a chance to think about farming from the point of view of the whole lifecycle of a production animal.
Stepping up farmer education
While the Baltic farmers are taking a larger role in educating their local public, Saga Furs has also become more actively engaged in educating the farmers themselves.
“They needed to understand that as an auction house we’re more than just a middle man, taking their skins and selling them,” says Gabinaitis.
Cepaitis agrees: “In the past, farmers haven’t understood the role of Saga Furs as a market maker.” According to the two reps, the farmers had no awareness of the company’s commitment to young designers and liaising with customer groups and big brands across the fashion industry, particularly on hot button issues like sustainability, animal welfare and transparency. They also didn’t have a clear understanding of how this level of engagement was contributing to the longevity of the entire fur industry.
Most Baltic farmers have now had a chance to visit a fur auction and better understand the complexities and challenges of the business. Saga Furs’ approach to farmer meetings has also changed.
“There used to be lectures to large groups by the CEO but people were afraid to speak out or ask questions in such a formal setting,” Gabinaitis explains. The current focus is now on smaller discussion forums to give farmers a voice. Market information sessions also include education on the growing demand from the big fashion brands for transparency and certified sustainable fur products.
However, against this backdrop, prices are down. Demand for cheaper, lower grade pelts is higher, making it harder to sell the higher quality skins from the Baltics. In the short-term, it’s difficult to find a solution as he farmers are not seeing the return on investments they’d hoped for and the banks are no longer lending.
“Thankfully for the farmers, Saga helps out,” says Gabinaitis.
As part of Saga Fur’s own commitment to sustainability, advanced payments are offered in some cases and even financing options for eligible farmers. This also helps them develop a longer-term view.
“We ask the farmers, where do you see this business in five years? They don’t all have a plan. When they work with Saga Furs they need clear budgets,” says Cepaitis.
Quality is there but waiting for prices to catch up
When Welfur comes on stream across Europe in 2020, the two men hope that long-term planning and investments will start to pay off for the Baltic farmers.
“The product quality in terms of animal welfare, environmental practices and transparency is there,” Gabinaitis affirms. “Now we’re just waiting for the pricing to catch up.”
Until then, Gabinaitis and Cepaitis will continue their discussions at the farm kitchen tables on the longer term value of their investments, and on the importance of sustainable best practices not just as a way to promote higher prices but as a future license to operate.