This week: At the beginning of last week there was great interest from China and the willingness of customers there to replenish their stocks at the price levels we have reached now. This gave the impression that the general feeling there is that the market has reached bottom for the time being and that the general easing of tension with regard to energy supply and political influence has increased.

We all know that Chinese buyers react very sensitively to local moods in the economy and, above all, politics. What was difficult, however, was the issue of pricing. Most buyers could not yet rid themselves of the conviction that their bids and price ideas would be accepted with enthusiasm. As in previous weeks, the price differences for cow hides were limited, but that was not the case with male hides. If you wanted to sell male goods, you had to grudgingly accept price levels based the prices in the US. At the moment, these do not even match the levels that are supposed to be paid at the abattoirs today. Be that as it may, if you wanted to make sales, it was possible.

The situation then began to change towards the end of the week. The rapidly rising covid-19 infection figures in Europe weighed on the mood with each passing day. Lockdowns no longer seemed improbable and if the negative trend is not broken in the short term, it is to be expected that economic and social activity will once again have to be significantly reduced in the run-up to Christmas. The necessary quarantine measures alone, which are associated with infections, are already hampering normal life considerably because great uncertainty is once again spreading.

The weak dollar supports calculations in overseas exports, but also demonstrates the dwindling confidence in the situation in Europe. The situation in the automobile industry remains opaque. One has the impression that the high profits of the first half of the year are now being used to counter-balance problems and costs. We would not be surprised if production returns to normal at the beginning of the new year. At the moment, however, the situation is still very unpleasant.

This week’s demand, as already mentioned, was very price-related. People were looking for bad assortments and even renderer material as long as it was cheap. For many items, the only decision to be made was whether to part with the goods or wait for better times. Overall, the quantities sold were satisfactory and the prices will show in the coming weeks which decision was the right one.

The kill: The kill remains quite stable at the usual higher level of November. It might even be possible to increase production, but there are considerable bottlenecks in cutting and further processing, so that a further increase is not possible at the moment. We expect volumes to remain high in the coming weeks, unless restaurants close again before Christmas. 

What do we expect: Prices are adjusting more and more to the realities. Without new uncertainty caused by the pandemic, we would say that probably no major changes could be expected until the end of the year. However, owing to the increased infection rates, short-term surprises are possible on the supply and demand side, which would then of course be reflected in the market, positively or negatively.

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