US Perspective—15.01.19
15/01/2019
www.themaxfieldreport.com
Packers entered last week with offer lists that appeared to be fairly well populated, with many offering various selections of heavier-weight steer hides. In addition, there continued to be numerous reports of HNS for sale, as well as numerous selections of wet blue hides. Packers started the week with asking prices unchanged form the past couple of weeks. What we found intriguing about offers last week is that some of the packers appeared to have moved out shipping times on a handful of selections; there had been “rumblings” of some better-than-expected interest late the week prior. The week saw a decent number of bids for several members of the trade, while by the second half of the week, we heard claims from numerous sources of a surprising number of bids; even more important was that the majority of these bids were deemed “workable”.
It appears as if packers were able to ward off attempts from buyers to purchase under the last reported trading levels. A fair number of hides changed hands last week and it’s likely packers were easily able to clear their production, and then some. However, we cannot verify sales the past few weeks as the US Government remains closed and the release of the USDA Export Sales Report is suspended until there is a resolve. This shutdown is officially the longest in US history and several government employees, despite still being asked to work the last few weeks, did not receive a pay-cheque last Friday. It will be interesting to see how many of these employees show up for work this week.
In the cowhide market, reports claim that the offer lists of many producers did not appear nearly as populated as in the past few weeks. Some selections were absent from offer lists last week, especially HNDC. There were also reports that shipping times on some selections were moved out a couple of weeks versus prior offerings. The week started out with decent interest from tanners from numerous countries. However, not all sellers saw an improvement in the number of bids they received last week.
A decent number of deals concluded last week with many taking place at levels $1-$2 higher than the lowest reported prices of 2018. Producers easily sold their production last week, and more.
Producers are anxious to achieve higher prices, especially considering that for the last 15-18 months they have been dealing with a market that has been trending lower. Sellers may want to exhibit some caution moving forward trying to raise prices too quickly, as this could easily stall the momentum they have in their favour.
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