US Perspective—08.09.15
08/09/2015
www.themaxfieldreport.com
It appears those who travelled to Asia prior to All China Leather Exhibition were not able to sell as many hides as they anticipated, and those hoping that perhaps sales would be concluded during the fair were disappointed for the most part. This led to comments from several members of the trade that a number of sellers had rather long faces.
Over the course of the show, packers in attendance continued their firm posture. All were insisting they possessed strong sold-forward positions and although many admitted to poorer than expected sales, they insisted they had no worries owing to record low slaughter levels. What we found interesting is that by the end of day two there were already several members of the trade in attendance commenting that some of the sellers did not appear nearly as confident.
At the end of the day, we still call the big packer market steady. However, it is clear that unless there was a tremendous number of hides sold by those in the office the second half of last week, it is likely we will see our second consecutive disappointing week of sales.
The firm tone of the market appears to be slowly fading on big packer hides, while we have already seen some lower trading levels on cowhides. Some of the trade is now headed to Italy for the Lineapelle fair in Milan while the rest will be returning to the office; it will certainly be interesting to see how sellers handle things this week. We are leaning toward the opinion that it is likely we will see a few more hides offered this week both from packers and processors, while we suspect packers will be reluctant to adjust their ideas, even though they have not sold enough hides for the past two or three weeks.
We look for processors to be reluctant to change their price ideas on HNDC, while we suspect a few may have to adjust their thoughts as to prices on plump cows. The good news for those selling hides is that in conversations with tanners at the All China Leather Exhibition, although many had a number of complaints with regard to a lack of leather orders, tight cash flows, grading and so on, the one complaint we did not hear is that prices are unaffordable.
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