What happened this week: The third quarter of the year has ended and the fourth and final one has begun. For most of the industry this means we are in the final lap with few opportunities left now to change fortunes and make a positive difference to the overall results for the entire year.

October and November are traditionally busy months in terms of production and sales. The Christmas season begins with sales that are very important for retail. In China we have Singles’ Day on Novem-ber 11, which has become a very important date for online sales, followed by the preparation for Chi-nese New Year, which next falls on February 12. It all feels a bit like ‘now or never’. Consumer confi-dence and activity in the coming three months will prepare the road for the year ahead.

If the pandemic does not hinder people in their spending and there is a clearance of stocks, the future for the leather industry could become somewhat brighter again. For a clear evaluation and a better un-derstanding it will still require a bit of patience, but patience is scarce at the moment. Too many people, for various reasons, are already celebrating the recovery of demand and production, with some indus-try publications running headlines suggest that ‘hide demand outstrips supply’. There have to be ques-tions about how anyone could come to such a conclusion now. The facts are certainly different and such statements carry the risk of killing the momentum of the recovery by offering the meat industry an excuse for pushing prices too far and too hard in the early part of the cycle of recovery.

We all have to do everything we can to restore leather demand and increase interest in the material. The phase of pipeline replenishment and seasonal activity cannot be seen as a solution for the fundamental problems we have to deal with. Without a strong recovery in leather use in the shoe sector everything is limited to certain sectors that are doing better for the moment, and nothing more. A breakthrough in leather demand in garments and shoes, driven by fashion, would turn the coin, but this is a dream and not a fact. We don’t need a boom-and-bust market. We need a sustained recovery of interest in and demand for leather.

Business this week has been pretty weak. The main reason was the Mid-Autumn holiday in many parts of Asia and the concern of European tanners regarding the price ideas that have spread around from the beef industry. Anyone who does not have to meet short-term needs is willing to wait for the dust to settle.

In the present environment nobody really wants to commit and face further substantially rising raw material prices. Consequently sales were mostly in the first two days of the week. Only a handful of enquiries could be satisfied.

The kill: The kill continues to be reasonable, but not exciting. Temperatures needs to drop further to change farmers’ attention and beef consumption.

What we expect: We should expect another quiet week. Asian customers are finishing their Mid-Autumn holiday and do not seem to be in a rush to buy. In Europe there needs to be a general strategy on abattoir pricing before the next round of sales. The respective positions of the different players are too far away from each other and a common, reasonable level of discussion needs to return.

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