Fluctuating Velvet Prices

by Robert Johnson
Hardrock Game Farms
Rendezvous Fine Foods & Gifts

In the early 1970s the velvet antler market was one that was unknown to many. I was one of the lucky souls who had a father who learned of this industry almost 30 years ago. I can still remember his enthusiasm. My velvet antler story begins on a day in 1970, when a close friend of my father, who was Korean, shared some information. He told us that velvet antler has a value and should be cut off. He instructed us on how to do this. We listened and learned. This particular friend then contacted an associate from Chicago, who purchased our 25 lbs of velvet antler, from two of our favorite bulls, for $100 per lb. Thus our interest in the velvet industry began.

Robert E. Johnson, my father, began passionate research on the industry. He was aware that in New Zealand they were capturing red deer to cut off their antlers. He then decided to actually visit various farms in Hong Kong, New Zealand, and Australia. His trip to Hong Kong's marketplace proved to him that there was not only a tanglible market but a high demand for this product. Deciding to pursue potential for this international market, he traveled on to his next stop, Neq Zealand. He discovered there that only a few red deer farmers had entered the velvet industry, with the majority attempting to get into the meat and breeding stock industries. This was encouraging because he was beginning to see real potential in the velvet industry. The New Zealand trip proved educational because it demonstrated to him that deer could be raised successfully in large numbers, contained within high fences. His next stop was Australia, but he discovered that this country was not nearly as advanced in the velvet industry as New Zealand. However, he did make several contacts and planted a seed to further develop the industry there, as well as at home.

His interest and enthusiasm were not shared by everyone. His friends and associates had many questions and concerns. Questions on how to cut antlers were constant. The major concern was how the removing of the antlers would affect the bull's future antler growth. The other pertinent concern was who the devil were they going to sell it to? These, my friends, are exactly the same questions being asked today.

My father answered all the questions and shared his Chicago contact. Thus the elk velvet networking process begins. This was during the winter of 1973, when Hardrock Game Farms began leading the industry in the accumulation of velvet antler to be shipped to Korea. At that particular point in time, velvet antler was valued at $100 per lb. My father acquired and shipped around 220 lbs of velvet antler. A high level of interest was sparked among other elk ranchers. Then an unfortunate event transpired; the velvet antler industry crashed. There were virtually no buyers for well over two years. This didn't stop my father, who believed in this industry. He continued to receive velvet antlers, which he diligently placed in the freezer.

Then in 1976 his Korean friend contacted him again. This friend expressed deep sorrow and concern that he had not contacted him during the previous two years because of the market situation. He excitedly told my father that he would be sending someone from New Jersey to purchase as much velvet antler as he could procure. Great news for my father, the farm and the velvet industry!

The velvet antler market took off. In 1979 velvet was selling for an astounding $12 per lb. Then in 1980, the price spiked at $150. Needless to say, interest and enthusiasm grew. Ironically, in 1981 prices dropped to a mere $65, a prelude for another crash in 1982. The only velvet antler selling was a small amount for domestic use only. The justification or rationalization for this crash was the South Korean military takeover of its government, which resulted in a closed-door policy for international trade. The demand for velvet returned in 1983; unfortunately, it was at the low price of $35. The market value moved slowly; in 1984 it was at $40, but it dropped back to $35 in 1985. With a slow market increase per year, by 1991 the value per pound shot up to a surprising $110. Oh, how the industry needed this ray of sunshine! Of couse, like any commodity, the market once again plummeted - to a mere $30.

Well, at this stage in the game, my father and I refused to sell velvet for that price. We, like many other major players in the market, had a great deal of velvet stored. What would we do next? Where would the market go? These questions and the fear that went along with them were very real. The risky decision of not selling had a positive effect on the overall market value of the velvet. The demand grew, and so did the value of the antler. By 1993 its value was once again at $60. We saw the market steadily rise, and by 1995 it hit another high of $100. This price slowly sank to a low of $60 in 1997. Then in 1998, we were hit with the most substantial crash in the market - when antlers were selling for $15 - due to the Pacific Rim's economic crisis.

I am now going to bring you to the present. In 1999, the industry has had its very own roller coaster ride. At present, we have a market that will pay us $20 to $30 per lb. for our velvet antler. I can safely predict that eventually the price must go up. On a positive note, the historical average range is above $50 lb. Due to the market fluctuation, elk farmers have developed the domestic market. My company created Rendezvous Fine Food & Gifts in 1988 to help create a more stable market for velvet antler. It has allowed me to trade raw antler for bottled velvet capsules that are custom processed - thus creating a stronger infrastructure for the market. I have seen many others follow suit, enabling us to have the luxury of assuring those in the business that there will always be a demand.

In my opinion, the industry is like rocket getting ready to take off. I cannot tell you just when liftoff will begin, but I know I am already counting down.