German Perspective - 12.03.19
12/03/2019
In the meantime, the facts speak for themselves. Many supplying origins continue to pretend they have sufficient sales and the prices quoted in public have not changed much since December 2018. For some isolated grades and hide types this might be true, but to generalise and apply this logic to the entire market is certainly not appropriate.
One just has to look at the statistics that have been published in the US. You don’t need to have an academic degree to understand that individual situations can occur, but overall the market is not in balance. The same applies for other parts of the world, including ours.
Almost everyone who is known to trade hides has more than enough approaches with offers. Hides which normally go directly to the tanning industry have not found a home there for a long time. Those that would have never thought to sell to a trader or colleague are now making proposals and offering good volumes.
Once again, this cannot be generalised and those who are still in a reasonable position won’t see it this way. Those who are looking for help and for sales will never admit it for fear of weakening their position. Those who some time ago would have been delighted to get the chance for new supply and material have to shrug their shoulders, because their options are no better. As a result, global trade remains in the same pattern as before. Total production of hides exceeds demand for leather.
Nevertheless, there was news to deal with last week. It started with an interview published in German magazine ‘Der Spiegel’, in which a German representative of PETA welcomed vegan trends in the automotive industry. As much as everybody is free to have their own opinion, the content of this interview was loaded with incorrect and false information.
Two things are amazing. One, that the leather industry has not made any progress on getting its facts and figures noticed. Two, that PETA manages to get a generally reputable magazine to publish something that is full of false content. Independent journalists generally claim that they research and verify facts before publishing, but they have completely failed in this case. The comments in readers forums are interesting, with the vast majority having recognised the intentions, regardless of the individual position of the reader.
We also got interesting news from China, where cheap hides of around $10 are being sought for the production of lime and wet blue splits. The information was that demand for collagen and gelatine is now longer finding sufficient supply and that shoe manufacturers have placed a larger order for split leathers, which can be filled by splitting extra cheap wet blue hides. These hides are still available in abundant suppliers.
There were some hides sales last week. A few cows, some heifers and patchy sales of heavy bulls in Europe, but this did not add up to any significant number. It was better than nothing, at least. Prices were mostly steady and the weaker Euro helped a little bit for Euro returns. The next trend and review of the market will take place in Hong Kong this week.
The kill: The kill is down, even more so last week due to the carnival break, which interrupted slaughter for one or two days in the region. Weights remain quite heavy. Slaughter is supposed to normalise in the coming weeks, but levels are expected to remain on the low side for a while yet. The total number for the year is expected to be down around 3%.
What we expect: The trade meets this week in Hong Kong. It is likely everyone will search for any light at the end of the tunnel and there will certainly be many stories around. In terms of sales, it appears good ideas and knowing what the best and most valuable use of your product is plays a much bigger role than just sticking a price tag on the hide and waiting. Those with know-how in terms of offering have a better set-up in the buyers’ market.
| 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 | € 0,40 |
Stable |
| Thirds bulls | 30/+ kg | 38,0/40,0 kg | 24/+ kg | 33/36 kg | € 0,60 |
Weakish |
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