Feathers fly as H7N9 hits China's down industry

The H7N9 bird flu epidemic, which has inflicted huge losses on China's poultry industry, is also hitting the country's down products manufacturers.

The virus, which has so far killed 36 of the 130 people infected nationwide, prompted the culling of birds and the closure of poultry farms and thus cut the output of raw down feathers, sending their prices spiralling upward.

As a result, many down products producers have no choice but to idle their production capacity.

"Even you have money, it's not easy to buy enough duck down feathers," said Yang Bin, chairman of Bingda Feather Co. in the city of Fengcheng in Jiangxi Province, a major down feathers trading center in east China.

"Due to materials shortage, our staff are working half days," said Yang. "Our workshop used to be stuffed with raw down feathers and the workers could barely find any empty space to stand on."

Down products manufacturers in the Xintang sub-district in Xiaoshan District of Hangzhou, capital of east China's Zhejiang Province, where nearly 70 percent of China's raw down feathers are processed, are also feeling the chill.

They have faced severe shortages of materials as the local government ordered them to stop purchases from regions including Shanghai and Anhui that have recorded a high number of H7N9 cases.

Chen Xiaoyang, a worker at the Hangzhou Hualong Eider Down Products Co., said staff used to rest only one to two days a month, now they take about one week off on average per month. As a result, many workers earn 1,000 yuan less a month, said another worker named Han Danhong.

Yang Cheng, chairman of Chenglong Eider Down Products Co. in Jiangxi, said the materials shortage has prompted the company to halt production since late April. With more than 100 workers, it churned out an output value of 180 million yuan last year.

The shortage has sent prices of down feathers skyrocketing and the costs could ultimately be transferred to customers through high prices of down products, experts have warned.

Many companies then either have to bear the higher costs to proceed with orders or choose not to fulfill the orders at the cost of business credit.

"A butcher shop contacted me saying that the price for the down feathers of a white duck was 3.1 yuan. I did not accept it as the fee was half that a year ago," said Yang Cheng.

"The price hikes are beyond imagination and have not been seen in decades," added the company chairman.

"The more we buy, the more losses we will suffer," said Chen Xuehui, chairman of Xinhui Eider Down Products Co.. He explained that when the company signed product orders before February, the price of down feathers was 300,000 a tonne. Now, the price has doubled.

"We're using the inventory and buying a small amount of new down feathers to cope with the orders to be delivered in July," said Chen. "For the remaining orders, we have to wait. Based on current costs, we will suffer a loss of millions of yuan."

Lu Yifeng, president of Hangzhou Hualong Eider Down Products Co., said that most of the firm's orders were signed last year: "If we fulfill them, we will face losses. If we wish to avoid the losses, we have to breach the orders but then our business credit will be damaged. This is a dilemma."

Special report:

H7N9 avian influenza