This week: We have reached the end of the third quarter. This is usually the end of the summer break and the start of the phase of higher production and higher slaughter. Presumably this will also be the case this year, although there are at least some doubts and possible surprises being discussed regarding the situation in Europe. Above all, some of the automotive leather tanners in Europe do not give the impression that a significant increase in production can be expected in the coming weeks and months. There may be many reasons for this, but vehicle sales and demand for leather offer little hope of any significant improvement at the moment.

In Europe, furniture leather production from mid-October onwards has always brought stable demand for raw hides. Here, too, the information one gets from the retail trade, from the furniture factories and from the leather manufacturers at the moment is not particularly positive. Elsewhere, too, excessively high stocks in the retail sector are still pressing.

So, the focus this week remains on the continued activity of customers in Asia. Here the week was almost identical to those we have seen since the end of August. There is always a lot of interest at the beginning of the week and sales are always possible. This week, as the US dollar remained firm in the first few days, price negotiations were somewhat easier than in previous weeks. This always starts with prices that are $1-$3 below the offers and then slowly but surely works its way towards corresponding compromises.

The focus of interest remains on female hides, but here and there, surprisingly, selective deals for heavier male hides were also possible. With the male hides one has to make somewhat larger price concessions whereas with the female goods, as already mentioned, the differences are not so great.

In the second half of the week, activity and interest dropped significantly, but this will not really surprise anyone, as China is almost completely in holiday mode for the Mid-Autumn Festival. What was pleasing and a confirmation of the improved situation was the fact that payments and shipments were also settled quickly before the holiday and the holiday period was not used as an opportunity to delay, as so often in the past.

The only question now is how sustained the interest from China will be in the coming months. There are quite a few voices that believe that the purchases of the last weeks and months were made to a greater extent by traders who now want to convert their relatively low average cost prices into profits and, therefore, one could possibly see a pause in purchases after the holiday.

The kill: The kill is now slowly increasing, although the weather continues to be rather summery. This is attributed to relatively good export business for beef. This would be pleasing if it alleviated the problems in the slaughter industry and even compensated a little for the decline in volume nationally. Otherwise, there will be little change in the normal rhythm and as soon as the weather adjusts to the season, the kill will also increase.

What we expect: For a week, the market in China will probably drop out as a player. This means that the focus will be more on European customers again, and this is where the fundamental problems lie. These include the stocks of semi-finished material, which are simply too expensive for the world market. At the same time, there is not enough demand for them in Europe. Thus, a price structure in line with the market for the different hide types will probably continue to be struggled for.

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