Annual Cashmere Report 2020



2019 had already been a tough year for the cashmere industry around the world. From the middle of February 2020, some dehairing mills were starting to receive some orders, but with the spread of COVID-19 and the subsequent worldwide lockdown, all these orders were cancelled. In April, the price for cashmere decreased by around 15% compared to January. The production had been similar to 2019, but the mills have been forced to stay closed until the beginning of June, initially due to the pandemic and afterward due to the complete lack of cashmere demand.

In China, the market only increased slightly at the beginning of March after Chinese New Year, when top makers started producing the orders booked in November and December 2019. However, as the pandemic continued to spread across the world starting from mid-March, the market fell sharply. Luckily, China has been able to reduce losses caused by the virus, as the mills could receive bank loans and a tax break. The government promoted policies that encouraged consumption after the lockdown was over at the end of March, trying to support the local market.

As cashmere collecting started in April and May, the Chinese market strengthened for only a time period of two weeks. Cashmere export came to a halt as the pandemic led to a complete shutdown in many key consumer markets, in particular the US market. 

In June and July, most of the top makers had to stop their machinery. This shutdown caused issues for Spinning companies who had to keep their machines running to pay their workers. The price for cashmere yarns reduced by around 18% compared to the period before Chinese New Year.

As the pandemic got more and more under control in China some spinners received processing orders from abroad e.g. from India. The cashmere yarns business rebounded in July and August, but mainly for Mongolian cashmere.

Thanks for the Double 11 selling, the domestic market turned a little better from September to October. The price of cashmere went up slightly by around 5%.

All in all, the cashmere production in 2020 decreased by around 3-5% less compared to 2019. The price of Cashmere fell by around 15% during the short period after the pandemic started to spread in March. From July to December, the price increased by around 10-15%. 


Mongolia has implemented “Cashmere Program” (2018-2021), the purpose of this program is to increase cashmere production in Mongolia by 60% and increase the production of environmentally friendly end products to the foreign market, increase the export of this products on the International Market.

Mongolian government is giving low interest loans to the cashmere industries 188.2 billion MNT in 2017, 107.3 billion in 2019 with 12%-14% interest rate per year, another 300 billion MNT loans in 2020 with 3%-8% interest rate per year. Asian Development Banks “Agricultural and Rural Development Project” provided 3.89 billion MNT to 3 enterprises and 8.2 bill. MNT to 2 enterprises with 7% of interest per annum. Despite these efforts the pandemic has put the whole country and cashmere industry in great difficulty.

Due to political election in Mongolia in 2020, the Government tried to maintain high prices for the raw cashmere, but the real consumers market in China and Europe was not responsive enough.

Due to pandemic, Mongolian tourism industry from abroad was completely blocked affecting a lot the cashmere garments’ sale. The most of the orders of big brands were cancelled.

Mongolian borders were closed from end of January 2020 until now, nobody could have travel. Mongolian and Chinese traders were missing. The shipments of scoured and dehaired cashmere from Mongolia to China have been delayed for more then 30-60 days and even more. All these factors have contributed to a price reduction then previous 2019.The prices of raw cashmere had dropped by 25%-30% also during economic crises of 2009 and 2015. In 2020 instead, the prices of raw cashmere has fallen by 40%-50% compared to 2019.

Mongolia accounts for 40% of the world production. In 2020, dehaired cashmere export reached only 215 tons compared to 392 tons in 2019, meaning 45% less than 2019. The most of the cashmere was washed in Mongolia and then exported to China. The main markets for dehaired cashmere such as Italy, Great Britain, Germany had a very slow market demand due to the pandemic.

According to Mongolian Statistical office the livestock in Mongolia is continuing to increase, arriving at 30 million goats (from total of 70 million animals), the total production of cashmere arrived at 10.000-12.000 million kg of greasy. In June 2021, will be election in Mongolia and the Government has promised another  200 billion MNT at 3% interest loans to the industries and will try to maintain the prices at high level as possible…. Let’s see what happens.


For Iranian cashmere, the year 2020 started with an inherited lower cashmere price from around $95 in the middle of 2019, down to $75-80 in January 2020. With these low prices, it seemed already that the world economy was moving towards a recession in 2020.

Then came the pandemic and like almost everything else, the cashmere market, not only faced a free fall of price, but it also faced a severe lack in demand.

On the other hand, the greasy traders in Iran expected a sharp increase in price due to very high local inflation and continuously descending local money value. This expectation was becoming true for almost any product except for greasy cashmere, which had no demand. A few big traders of cashmere were soon forced to sell their stock at prices much lower than their purchasing price. A famous Afghan trader who had bought at $18/kg at one point, sold the same at $10 in a few months’ time spans.

In January 2020, the price of Iranian cashmere was around $75-80. In November of the same year, the price was around 45-50. A drop of around 40% not mentioning the demand which was almost none. The price of greasy cashmere during the same time dropped from $12 in January to $8 in November, almost the same percentage drop. However, prices suddenly increased in December due to large-scale purchases by Chinese traders and their Afghan/Pakistani and Iranian agents who collected cashmere for export to China.

Now and then some rumours about the prohibition of the export of raw cashmere from Iran or prohibition of import into China of raw natural fibres cooled down the market but whenever traders found ways to tackle the problem, again prices increased.

Due to the purchases by the Chinese, the year closed at around $11 which was a 30% increase compared to the month before.

Regarding the quality and quantity of Iranian greasy cashmere in 2020, it must be said that the quality was better than previous years but quantity as always is unknown because there are no official statistics. A wise estimation indicates that the quantity is only around 1,000 tons out of which half is economically fit for processing and the other half is tannery with a short length and low yield. The tannery is the result of the slaughter of the goats for the meat rather than keeping them for milk and the cashmere.





2019 had been already a tough year for the cashmere industry all around the world. From the middle of February 2020, some dehairing mills were starting to receive some orders, but with the spread of COVID-19 and the subsequent worldwide lockdown all these orders have been canceled. In April, the price for cashmere decreased by about 15% compared to January. The production had been similar to 2019, but the mills have been forced to stay closed until the beginning of June, initially due to pandemic and later on because of the complete lack of demand for cashmere.

In June and July, most of the top makers had to stop their mills, but spinners were struggling since they had to keep spinning to pay their workers. The price of cashmere yarns reduced by around 18% compared to the period before the Chinese New Year.

The market in China slightly increased only at the beginning of March after Chinese New Year, when top makers producing the orders booked in November and December 2019. But as the pandemic spread all over the world from the middle of March, the entire market went down sharply and everyone had to slow down the business. Luckily, China has been able to reduce the losses caused by the virus, as the mills received big supports from bank loans and a tax break. The government promoted encouraging consumption policies after the lockdown was over at the end of March, trying to support the local market.


The annual inflation rate in Mongolia slowed to 2.1 percent in August of 2020 from 3.4 percent in July.

Mongolia exports of wool, animal hair, horsehair yarn, and fabric was US$362.82 million during 2018.

Mongolia exports of wool, animal hair, horsehair yarn and fabric – data, historical chart, and statistics – were last updated in September of 2020.

Exports in Mongolia decreased to 690.20 USD Million in August from 960.50 USD million in July of 2020.

Due to the frozen situation of the global market, the GDP of Mongolia has shrunk by 6.1 percent.

According to the Mongolian statistical office the livestock in Mongolia is continuing to increase, arriving at 30 million goats (from a total of 70 million animals), the total production of cashmere arrived at 10.000-12.000 million kg of greasy.

The Mongolian government has announced an MNT 300 billion (USD 100 million) loan package to support its cashmere industry to face the coronavirus pandemic, with one condition that cashmere processors have been offered loans to buy raw fiber at a minimum price of 100,000 MNT/kg equivalent (38$/kg). The Mongolian cashmere market was almost firm from March-April 2020, nobody was accepting last year’s price.

The cashmere market is a strategic business in Mongolia because it involves 230.000 herding families and their vote for during an election is very important. This is why the Mongolian government promised 38$/kg for greasy cashmere, to obtain the herders’ vote. But after 2 months of negotiation and delays, the cashmere price has dropped to the real market price. The Mongolian government tried to maintain these high prices, but there is no demand on the international market.

The Mongolian government has issued subsidies to herders of about $7 per cashmere goat and offered processors lower interest rates on subsidized loans provided they purchase the raw material at 2019 prices. As soon as the herders received subsidies from the Government they stopped selling the cashmere and waited for the better prices close to 2019.

Due to the COVID-19 lockdown, Mongolian borders were closed from the end of January until now, nobody can travel to Mongolia and Chinese traders are missing. The shipments of scoured and dehaired cashmere to China and overseas have been delayed.

All these factors have contributed to the price reduction from $38 per kilo in 2019 to 24-27/kg in 2020.

In 2007-2008 during the financial crisis the price fell down by half, the same situation is repeating this year.


In February just before the widespread COVID-19 outbreak, some Chinese, Afghan, and even Pakistani traders had bought in Iran some lots hoping to take benefit from depreciated local money and this strengthened the prices. Then in March, the worldwide outbreak of pandemic shattered the markets and this coincided with the Iranian New Year holidays. All of the above factors caused silence on the raw market.

Usually, in February new clip start appearing in the market and the battle of pricing begins, but this year’s market was absolutely dead with no news on prices and availability.

In May, prices in Iran dropped like everywhere else. To start, there was resistance but since no Chinese buyers came to purchase, prices gradually came down. Surprisingly, though, the final prices of raw Iranian cashmere were higher than Mongolian cashmere ones. By the end of June, some Chinese buyers have appeared again and their purchases put an end to declining prices although their purchase intention was only for limited volumes. The Chinese traders could benefit from free-market currency which was at least 25% more expensive than Iranian export currency.

In July, the Chinese, Afghan, and eventually Pakistani traders began to buy in Iran enjoying weak local currency. The Iranian government tried to stop this situation by blocking the export of raw cashmere, which was possible with some duties to be paid. Since this governmental intervention, important quantities bought by Pakistani traders destined for China, are now stuck and cannot be delivered.


Annual Cashmere Market Report 2019


In 2019, cashmere production in China was 15.437,8 tonnes, a reduction of about 13.5% compared to 2018. Due to the decrease in demand in 2019, it is estimated that production in 2020 will be about 10% less than last year.

At the beginning of 2019, demand for cashmere was still good. With the reduction in production, the price of cashmere rose significantly in April and May in conjunction with the arrival of the new season.  From June to July tariffs were increased due to the Sino-American trade war.

In addition, in 2019 the price of lambs rose by about 15% to 18%, which led to a further reduction in cashmere production.

Starting in August, demand for cashmere decreased significantly, leading to a reduction in prices until the end of the year. Most Chinese factories have ceased production.

Overall, the average price of cashmere in 2019 fell by around 12% compared to 2018.

From January to June 2019, China exported 1.331 tonnes of cashmere, an increase of 8.3% compared to the same period in 2018. Total turnover was USD 98.228.000, an increase of 9.1%. However, from June to November, 2.630 tonnes of cashmere were exported, a decrease of 10.2% compared to 2018. The total amount was USD 129.156.000, a decrease of 8.9% compared to 2018.

For the next season, all factories should return to regular operation only from March due to the Coronavirus problem. If demand returns, prices may rise again, especially for fine/beautiful types.


The extreme winter conditions and the dry winter of the Mongolian territory have caused extensive losses of livestock, despite which the shepherd communities have tried to survive as much as possible. As there is no rain, the wind dries the grass and the animals are leaner than usual.

According to the Mongolian statistical office, there are about 70.9 million heads of livestock in Mongolia. In 2019 the total number of cashmere goats reached 29 million, equivalent to about 9.800 tons of greasy cashmere, compared to 27 million goats in 2018, equivalent to about 9.400 tons of greasy cashmere. The price of greasy cashmere increased by 28% compared to previous years. The cashmere industry is expected to grow by 3.9% per year for the coming years.

Last year, Mongolia produced 8.066 tons of clean cashmere (90% of total cashmere production) which was mainly exported to China and 408.5 tons of dehaired cashmere (the equivalent of 817 tons of greasy cashmere). The main importers of dehaired cashmere were Italy with 342 tonnes, England 46.3 tonnes, Germany 3.8 tonnes, India 5.1 tonnes, and other countries 11.3 tonnes. 90% of the whole production was first-stage processing, with final product manufacturing only accounting for 10%.

In spring 2019, Mongolian cashmere shepherds sold their cashmere at 145.000 MNT/kg (54.70 USD/kg), almost 40.000 MNT (15.00 USD/kg) more than in 2018 prices. In 2019, the cashmere season in Mongolia opened with very high prices of 54-55$/kg, although the market in Europe was relatively quiet.

Both Mongolian and Chinese traders hoped that prices would remain as high as in 2018. The strengthening of the RMB gave Chinese traders the opportunity to get cashmere at a reasonable price.

Unfortunately, from June/July 2019 prices fell due to European market demand, Chinese market consumption and the Sino-American trade war. Macroeconomic factors also had a substantial impact on the cashmere industry: labour costs, tax rates, interest rates, and exchange rates.

In the future, the Mongolian government will promote value-added products for export.

On July 26, 2018, Representative Ted Yoho and nine other members of the US House of Representatives delivered a trade bill to the US Congress. The bill would seek to promote trade between the United States of America and Mongolia by allowing duty-free trade for certain imports from Mongolia, such as cashmere products and textiles.

In connection with the trade bill, Mongolian President Battulga Khaltmaa visited the United States on 31 July 2019. During the visit, the Mongolian President expressed his full support for the trade bill and his appreciation to the sponsors.

The trade act would help the Mongolian economy to open more business opportunities to export cashmere products to the U.S. market. Mongolia supplies about 48% of the total greasy cashmere to the world market, making the country the second-largest supplier of greasy cashmere in the world, but uses only 15% of it to produce ready-to-use finished cashmere garments locally.

The remaining 85% of greasy cashmere is sold as semi-finished products to other markets with lower added value, which is becoming the focal point of the Mongolian government and domestic cashmere producers.

The United States of America is considered the second-largest consumer of finished cashmere garments. This duty-free treatment would open up a huge opportunity for Mongolia to diversify its economy.


For Iranian cashmere, the year 2019  started with predictions of price increases similar to the previous year. However, most traders ignored or preferred to ignore, that any price increase in 2018 was due to strong fluctuations in the value of the local currency against international currencies, caused by the economic sanctions imposed on Iran by the Trump administration.

The value of the local currency halved during 2018, and in some periods it even lost two-thirds of its starting value. The cashmere market was not so rigid in 2018, so Chinese traders took the opportunity to use their expensive dollars and rushed into the Iranian market. The result was an increase in the price of Iranian cashmere at a rate of 400% in local money but only 50% in USD.

In 2019, the international cashmere market began to collapse with prices falling sharply, again perhaps due to the sanctions imposed by the United States on many Chinese goods.

Chinese traders have not been seen often on the market this year if not only occasionally and only to test the market in Iran. The local currency has also reached a stable level. Therefore, both factors that generally influence the rise in prices have been absent.

Although once again there have been ups and downs in the value of the local currency, the market has seen a stable price structure in terms of both Rials and USD throughout the year.

Traders, who had bet on price increases, bought large quantities at high prices and were unable to dispose of their stocks.

As a result, not much was sold last year and a lot of stock has been maintained for 2020, but the price is still high. This has caused Iranian cashmere to lose its market and there is not much hope for the new season unless the arrival of the new shear in April forces traders to start selling their leftovers at a loss to stay in the game.

Again, much will depend on Chinese traders and also on the devaluation of the local currency, although it now seems stable, the tighter sanctions envisaged could lead to further devaluation and again to a sharp rise in cashmere prices in Iran.





In October, the price of finer type cashmere decreased again by about 10%, but with a consistent regain in November. Compared with last year’s 2018 October to November, the price of cashmere fibres reduced around 30%, due to a weak market. On top of that, the production volume is a bit higher than last year. In this case, the supply is higher than the demand. On the opposite, the price of lambs in 2019 is much higher than last year, which means farmers can compensate their revenue by selling mutton. Since the cashmere is easy to be stocked, the farmers are waiting for better prices to sell. The US is the largest market for exporting Chinese cashmere. Due to the trade war with the United States, taxes for exporting cashmere to the USA increased. As the economy becomes weaker, the market for cashmere continues to be very bad.


Also, in Mongolia, the market has come to a standstill without significant movements. After the continuous decrease in prices between September and October, the prices are now stable. Compared to November 2018 the general prices have dropped by around 10 to 15%.


The market in the Middle East has been completely stuck, with no transactions. Chinese traders approached the market in November hoping to use this quiet situation but could not convince traders to sell at their desired prices and left leaving a low bid which has not been met by any seller.
Prices are down in local money but still high in terms of hard currency, which still leads to Middle Eastern dehaired cashmere prices being relatively competitive with Mongolian prices.


July – August 2019



After a crazy collecting period during the last 2 to 3 months, the traders now have enough stock. At the same time, demand is still not good. The price of cashmere is 10% less than July 2018. Compared with prices in June, the situation is basically unchanged. For finer cashmere types, the price is still on the high level because of limited availability. The prices for low and medium qualities should come down shortly. Recently the RMB has been getting weaker, due to the trade war between China and the US. This is offsetting some increase in prices.


Mongolia is still the second-largest producer of cashmere in the world with 10.000 tons of greasy cashmere.
From 2015 to 2019 the cashmere production was constant and almost 90% of whole cashmere production is exported to foreign countries (89% exported to China and 11% to European countries).
Main importers in the EU are Italy, the UK, Germany. However, globally the main players are always Chinese buyers.
In the first 7 months of 2019, almost 75% of cashmere was exported. Compared to July 2018 the exported quantity of cashmere has increased by 5.2%.
The cashmere price has been stable over the first five months of the season and now it is expected to follow the EU/Chinese market trend for the next months.


News of a poor international market and low prices of Mongolian stock in Europe has reached the Middle East and has at least halted the price hike. Although no Chinese buyers are present in the market now, the market is still stable and no trader is willing to reduce its prices and sell with a loss, hoping that prices will strengthen again after the European summer has ended.


April 2019


Due to high prices during the last cashmere season, cashmere demand declined noticeably compared to July 2018. During February and March 2019, prices had reduced slightly. However, once the newly harvested greasy cashmere entered the market in April 2019, prices increased once again reaching the high levels of December 2019. Momentarily the market is quiet due to low availability of cashmere, especially finer fibres. Brokers and processors are nevertheless buying the new season’s offerings even though demand further down the supply chain is still poor.


This year the greasy market has opened 13% more expensive compared to last year. Winter has been very dry and without snowfalls, causing high presence of dust, low yield and lower quality in greasy cashmere. The cashmere growing regions have still not had any rain.
Demand for Mongolian cashmere is coming predominantly from China while European buyers have not yet expressed any interest in Mongolian cashmere.


Due to very a very unusual spring climate with cold temperatures as well as rain across the whole country, cashmere goats have not been clipped yet. The small quantities being traded these weeks are unsold stocks from last year. Prices have remained unchanged compared to March 2019.


February – March 2019


After the Chinese New Year in the middle of February, the price for cashmere has been increasing steadily. Also in March, the price increased by around 10% compared to February. Compared to March 2018, the price is 30% higher. The demand for cashmere seems also to go up a little as the new season approaches.


So far the market in Mongolia has been quieter compared to last year. Annual production of cashmere is estimated around 9.000-10.000 tons of greasy. Snowfalls have been completely absent throughout all winter, resulting in worse and dusty quality, with a lower yield. But contrary to expectations the season has started with prices 13% more expensive than 2018.

A slight decrease in price is expected due to lack of quality during the next few weeks. Main buyers are Chinese as usual.


The market was quieter than usual during February/March because for over one month, export of all types of cashmere was banned. This was a government decision in support of the local carpet industry which had asked for a ban on wool and authorities had mistakenly prohibited cashmere export as well. Removing this directive took a long time and as a result, purchase was minimized. February/March is the period for tannery and now some good tannery is left unsold which may be mixed with spring clip lowering the final yield.

By the time this ban was repealed, the end of the season had already arrived and the market is now waiting for the new clip which usually should be out in April/May. But very heavy rain all over the Middle East will delay the new clip and it is now anticipated that new arrivals will be only available in May.