German Perspective – 14.05.19
14/05/2019
But, things have changed, although we cannot say exactly when. In Europe, it is mainly down to discussion about climate change and the environment. The protests of young people have successfully changed the opinion of the media and much of the public about carbon dioxide emissions. At the same time, they continue to use their SUVs, plan their next holiday be plane, campaign in favour of renewable energy. They take weekend trips carrying plastic bottles filled with shampoo, conditioner, etc., but condemn meat consumption.
These trends exist in the rest of the world too, but there the people are more impressed by the trade war between China and the US or the growing conflict between Iran and the US. There are also new missile tests in North Korea.
A real shot in the arm on the other side of the globe was President Trump’s tweets in relation to the trade conflict with China. This has sent real shockwaves around and has temporarily paralysed business activity in China. The activities that had been preserved were cut the moment that tweet was sent. Everything has been put on hold until the negotiations in Washington are finished.
Negotiations only began late on Thursday our time, so the hide sales week was basically over. From China, we only saw bottom fishing last week. The isolated bids were so low that they would not be considered even in the current market environment. It is clear that several people just wanted to check how weak and desperate the sellers are. They do not have any real need to buy or serious interest in hides.
The more worrying thing is what happens to the few pending sales, payments and shipments. Weird attitudes abound in the market and the big risk is that several players have already decided that they will no longer need suppliers in the future. This makes their behaviour more dangerous and unpredictable. If Chinese tanners want to be respected partners in the global community, they will have to decide if common rules apply or not.
Business was more regular in Europe. The successful tanneries, and there are still many, need to cover production and must lower prices in order to stay competitive and keep leather in play. The lower prices are making it easier for them, which is reflected in the more professional discussions and better sales potential here. Several have been renewed at lower prices. This is not enough, but it is better than nothing. The goods news is that nobody surrenders and with lower raw material prices, more options are opening up for the creative minds.
The kill: The kill is reasonable and normal for the season. Weights are still better than expected and are only declining slowly. However, the further spring progresses the more numbers and weights will fall.
What we expect: It continues to not look too good. The problem is actually China. The biggest user of hides is struggling and the leather sector is in the process of restructuring and has shrunk dramatically. So, there is still no home for all the hides produced. Quality hides still sell; the problem remains the surplus of commodity hides.
| 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 | € 0,80 | Weakish |
|
|
Dairy cows |
15/24,5 kg |
22,5/23,5 kg |
13/22 kg |
20/21 kg |
€ 0,70 |
Weaker |
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 0,55 |
Weaker | |
|
30/+ kg |
33,5/35,5 kg |
27/+ kg |
29/31 kg |
€ 0,50 |
Weaker | |
| Bulls | 25/29,5 kg | 27,5/28,5 kg | 22/ 27 kg | 25/26 kg | € 1,25 |
Pressure |
| 30/39,5 kg | 36,0/37,0 kg | 24/34 kg | 31/33 kg | € 1.30 |
Pressure |
|
| 40/+ kg | 45,0/48,0 kg | 34/+ kg | 38/40 kg | € 1.20 |
Pressure |
|
| Thirds | 15/+ kg | 25,0/27,5 kg | 13/+ kg | 24/26 kg | € 0,35 |
Weakish |
| Thirds bulls | 30/+ kg | 38,0/40,0 kg | 24/+ kg | 33/36 kg | € 0,50 |
Weak |
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