This week: Many in tanning are already beginning to wrap the year up. By the middle of next week in most tanneries the last hides of the year will be put into the drums and, on Friday, the production teams will leave the floor for the maintenance units and some final production in retanning, finishing and delivery.

Most of the administration units will work on end-of-year operations and on preparing the books and inventory controls. The kill continues, so all the businesses in between, like ours, have no chance of a rest except on the main holidays themselves.

Life is going to become somewhat complicated again because we have to expect another real lockdown of the country until 10 January at the earliest. In Europe, the customer base is a bit split. Some feel that it is wise to wait until January before making the next round of acquisitions, while others are trying now to lock in the raw materials they need for January. Not much has been done so far, because the abattoir-buying is not yet complete either.

Very ambitious price quotations are rejected outright. The main conflict and confusion centres on extra-heavy male hides, where the official positions of buyers and sellers show a wide gap in opinions.

For the remaining materials the main outlet continues to be Asia. Here too clients are beginning to dig their heels in and the usual bargain-hunting has started. Clients are aware that the European tanning industry is shutting down and so their main competitor is off the scene. Chasing the suppliers with low bids sometimes works and sometimes doesn’t; we do not dare to say what suppliers are going to do this year. For the moment, we believe that none of the low bids have been taken.

We would not be surprised if we enter a period of extended turbulence again. The currency market, transportation problems, Brexit and the progress of the corona pandemic offer plenty of potential for uneasy circumstances. Vaccinations and the end of government interference seem still quite far away and the replenishment effect on the pipeline may fade and dampen demand more quickly than people expect today.

For some weeks now, people in the Western world do not seem to have been bothering too much, with many withdrawing from business as much as possible to take a rest after the exciting and very exhausting year so far. In the East, quite a number of people are actively checking what kind of ready sellers can be found and are willing to discount the present levels.

From the present leather season we believe that approximately two months’ production still need to be covered and, with relatively fixed leather prices until the end, buyers will try their utmost to save money against the existing levels.
Sales last week were rather moderate. We ended up with bits and pieces for cows and some bulls into Asia combined with a handful of programmes for January in Europe; nothing particularly exciting.

The kill: The kill and the weights remain high and with a lockdown ahead we would not be surprised to see high numbers also next week owing to good supermarket sales. The rest of the year is then really unclear.

What we expect: Difficult to say. Either we will experience a bonanza with people trying to get the books for January covered, or the opposite. The market has become far more price-sensitive and with the levels reached it seems it is time for a break. However, few people will believe big changes are likely before mid-January. 

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