US Perspective - 19.02.19
19/02/2019
www.themaxfieldreport.com
Reports from the big packer trade claim interest in the second half of last week did not exhibit any substantial improvement compared to the first half of the week. The prevailing opinion of the trade is that the number of hides changing hands this week was disappointing. The good news for those selling hides is that it appears they were successful selling at the last reported levels, while we heard numerous comments claiming that any attempt to achieve an increase of as little as fifty cents per hide were met with a considerable amount of resistance from buyers.
In other news, it appears many packers’ offer lists were dominated by offers of heavier-weight steer hides. Offers of regular-weights HNS as well as BBS were not nearly as plentiful as in the past several weeks.
Overall, the consensus of the trade is that this was not a busy week of trading. Most pundits were surprised by the lack of activity, especially considering the lack of interest we had seen in the previous couple of weeks. It is highly unlikely that packers cleared their production last week, despite the fact we saw harvest levels dip below the 600,000 head level. While the good news for those selling hides is it appears trading levels this week were no worse than steady.
Shipping times on several selections have been moved out anywhere from two to four weeks compared to a couple of a weeks ago. Buyers are finding this confusing, as popular opinion is that sales have been lacklustre since the middle of last month, and tanners are questioning how accurate these shipping times truly are.
In regards to leather business, it continues to appear as if tanners pursuing automotive leather have seen some sizeable decreases in the past few months, with some pundits claiming soaking levels for many tanners are down anywhere from 15%-20%. Elsewhere, reports from the furniture trade appear mixed; we have heard that tanners focused on export business appear as if they are doing okay, while domestic tanners do not appear as if they are nearly as fortunate with leather orders not nearly as plentiful as a year ago.
Reports from the shoe trade claim most tanners continue to struggle as leather order are still falling short of levels of a year ago. In the meantime, leather buyers are well aware of hide prices and are aggressively seeking lower leather prices on new business. The situation is not much different for most handbag tanners. Competition from synthetics, plus a general lack of new business, has most tanners not optimistic about business for 2019.
Reports from members of the cowhide trade claim last week got off to a sluggish and did not appear to find any traction all week long. According to sources, there were a handful of buyers out looking to see if there were any bargains to be had and the few bids that most saw had buyers with price ideas well below the last traded levels.
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