US Perspective–03.05.11
03/05/2011
Courtesy of www.thejacobsen.com
Last week’s hide market tone was spongy with lower prices reported from packers, traders, and processors. Early in the week’s trading, packer HTS sold as high as $87.50, but the majority of steer hides were closer to $85 by week’s end. The net results were down with trades for steer ranging from $84 to $86 and off $1 to $2 from last week. Cow hides were mixed but mostly sold down around a dollar from previous levels.
Today’s reports continued to show downward pressure with most sales off from last week’s levels. Several reports circulated that packer HTS C&F Asian Port, were sold for $91.50 to $92. A couple of producers reported they had “a good week of sales”, with a wide array of buyers willing to step up to the plate and take advantage of lower prices. Prices for HTS and BBS ranged from $83 to $85.Today, a number of cow selections saw downward movement?by as much as $2?with reports pointing primarily to processor hides.
Earlier in the week, the notion had been put forward that Monday’s union-based holiday for some packing plants may reduce slaughter this week. Regardless of whether or not that was the prevailing cause, slaughter this week was certainly down, coming in at an estimated 615,000. Last week’s kill was 649,000 and for the same period last year, it was 662,195.
There were a few sales reported from China; however, producers report interest has waned following news of the Customs investigation (see Market Intelligence). Other hide consuming regions have remained in the game, albeit bids have been lower as buyers test the market.
US export sales for week ending April 21 were 547,000 combined whole hides and wet blue sales. This number compares to the yearly average sales of 531,000 the previous week and an average 564,710 through week 16. It is now eight consecutive weeks when export sales are below the year’s weekly averages, which is likely to be a major factor in the softer market tone. Sales this year have slightly fallen behind last year at the same time by 18,130 hides, when just three weeks ago last year’s sales were ahead by 5%.
Combined shipments for the same week were 622,400, above the year’s trend of 594,919. For comparison, slaughter last week was 649,000 while the year-to-date average was 639,216. At the same time in 2010, the average weekly slaughter was 633,410, and in 2009 it was 617,263.
Wet blue sales last week at 237,600 were considerably up from the prior week’s 89,000. Italy was the biggest destination receiving 113,900 whole hide and split grains, followed by China with 53,200 pieces. The year-to-date average weekly wet blue sales were 127,440 compared to the 137,944 average for the same time last year.
The figures for the three-years-to-date comparison of slaughter with sales and shipments are as follows. In 2009, slaughter, sales and shipments through week 16 were 9,876,214; 9,875,000 and 9,562,000. The figures for 2010 were 10,134,567; 9,053,495 and 9,262,900. The corresponding figures for 2011 are 10,227,454; 9,035,364 and 9,518,700.
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