US Perspective - 05.03.19
05/03/2019
Courtesy of www.themaxfieldreport.com
The underlying sentiment of the trade was that a general lack of sales since the middle of January would force packers to offer more hides last week. Despite that sentiment, packers came out with lists that appeared to be a carbon copy of those of the past several weeks, while trying to convey a message to prospective buyers that they continue to possess decent sold-forward positions.
Members of the trade claim there was a slight improvement in the number of bids last week compared to the week prior. However, considering most pundits did not consider the week prior to be a busy week of interest by any standard, the bar was set at a relatively low level. Buyers appeared reluctant to improve their price ideas, especially keeping in mind the number of people who are expected to be travelling in Asia this week.
As a result, with buyers not exhibiting any sense of urgency and packers appearing as if they were unwilling to negotiate prices, it is widely believed that we likely could have seen more business that was not concluded, versus business that was concluded, leading to thoughts that it is highly unlikely that we saw packers clear their production last week. The good news for packers is it appears the sales that took place last week reflect steady levels with the week prior, while there were a couple of isolated incidents of some sellers obtaining incrementally higher trading levels.
Reports from members of the cowhide trade claim that, here too, producers started last week with offer list that appeared unchanged. According to sources, popular opinion of the trade is that producers of cowhides likely possess stronger sold-forward positions than their big packer brethren and this certainly explains the firm posture of most producers last week. We are not aware of any members of the trade laying claim to seeing a decent number of bids last week. Prices last week were no worse than steady, while the number of hides changing hands likely fell short of the harvest.
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