German Perspective – 26.02.19
26/02/2019
With the wide variety of exhibitors and visitors there is usually something for everyone and every opinion has its justification. To generalise has become difficult these days. If one really wants to get to a general bottom line of the event, it might be fair to say that the diversion between the sectors has become bigger than ever before.
For those tanneries still focusing on the beauty, quality, comfort and functionality of leather, it seems Lineapelle was again an event that left positive feelings. Within the visitor base one could see many designers and material purchasing officers looking for the ‘right’ leather. Tanners were in a position to meet these expectations and after three very busy days most will travel home with well filled files from existing and potential new customers.
This is the good news and should be taken as a sign not to lose faith in the material despite the headwinds. However, at the same time we also have to deal with the hard facts. What started slowly in 2016, gained a little speed in 2017 and became an avalanche of falling prices and demand in 2018 has left very deep traps, frustrations and fading optimism about the future of the trade.
With the present conditions and the outlook for the near future, it is pretty obvious that things cannot remain the same. The typical cycles of up and down, which have dominated the leather business throughout its history, are at the moment being questioned. How difficult it is can also be seen in the problems some raw material traders had run into.
For the last thousand years, there was never a doubt that all hides and skins produced would eventually find a home in leather products. This is no longer the case. We have been destroying ovine skins for a while and we have now started to do the same for bovine hides. Put simply, there is just not enough global demand for leather to convert the total number of hides coming from the beef industry. This applies mostly for the materials which have traditionally found their home in commodity consumer products.
The biggest problem is that at whatever stage you cannot just focus on the material you want. Raw material is not uniform and it produces different results. You cannot pick just the hides you want at the slaughterhouse and in the next step have just one type and selection leaving the tannery drum.
So, the main story of the Lineapelle fair is that almost everyone is fine with 70% of their business but has no clue how to deal with the problems relating to the remaining 30%; certain selections killing the profit of the others, selections that cannot be moved at all, or simply missing orders and movement. To find someone not dealing with at least one of these problems was almost impossible.
Not much business was actually done. Specialties, regular traditions, trials, but there were not really any straightforward deals. Asia was back, but here is was again only bits and pieces, mainly for medium or better quality hides.
The kill: The kill remains somewhat subdued, as is frequently the case at this time of year. The bread-and-butter demand is still there, but there are so many unknowns. There continues to be a lack of males in the mix, cows are regular and the number of heifers continues to rise. We cannot see any reason why this would change until mid-March.
What we expect: Lineapelle has not left the impression that there is any new trend on the horizon. Here and there lower leather prices have encouraged increased demand, but this is just a fraction of the overall situation. The industry has to quickly find a solution for the hides which are simply not needed anymore. The others have to focus to defend their clients and markets. With regards to prices, we believe that females are steady and that males need another correction.
| Type | Weight range | Avg. green weight | Salted weight | Avg. weight salted | Price per kg green weight | Trend |
| Ox/heifers | 15/24,5 kg | 22,0/23,5 kg | 13/22 kg | 20/21 kg | € 1,60 |
Stable |
| 25/29,5 kg | 27,5/28,5 kg | 22/27 kg | 25/26 kg | € 0,90 | Stable |
|
|
Dairy cows |
15/24,5 kg |
22,5/23,5 kg |
13/22 kg |
20/21 kg |
€ 0,70 |
Stable |
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 0,60 |
Stable | |
|
30/+ kg |
33,5/35,5 kg |
27/+ kg |
29/31 kg |
€ 0,55 |
Stable | |
| Bulls | 25/29,5 kg | 27,5/28,5 kg | 22/ 27 kg | 25/26 kg | € 1,40 |
Pressure |
| 30/39,5 kg | 36,0/37,0 kg | 24/34 kg | 31/33 kg | € 1.40 |
Pressure |
|
| 40/+ kg | 45,0/48,0 kg | 34/+ kg | 38/40 kg | € 1.25 |
Pressure |
|
| Thirds | 15/+ kg | 25,0/27,5 kg | 13/+ kg | 24/26 kg | € 0,35 |
Stable |
| Thirds bulls | 30/+ kg | 38,0/40,0 kg | 24/+ kg | 33/36 kg | € 0,60 |
Weakish |
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