This week: It is usually July that sees a significant slowdown, but this year the holiday phase seemed to begin at the end of May. The only hope that remains, at least for the European leather industry, is that there will be a resurgence in activity before the full summer holiday shut-down. Otherwise, all that remains is the completion of the current minimum quantities that are necessary to keep the companies in production.

In phases like this, there is always a lot of talk. People are looking for information that could provide clues as to how the production of leather and the demand for hides and skins will continue in the near future. When there are few facts, hope, speculation and rumours abound.

Of course, there are those who believe that optimism is the order of the day and are therefore predicting a significant recovery by late summer at the latest. Although there are very few signs of this at the moment, it is at least conceivable that, on the one hand, raw material stocks in the leather factories may be reduced too far and, at the same time, the seasonal upturn, which will certainly also take place this year from September onwards, could possibly trigger an improvement in the market situation. This would also require no build-up of stocks in the supply chain over the next few months.

Even if the kill remains at a lower level over the summer, new hides will still come into the system on a daily basis and a market must be found for them. So far, there are few signs that leather manufacturers are outsourcing parts of their production to contract tanners during their company holidays. At the same time, this means that either the hides have to be salted or the suppliers have to process the goods into semi-finished products at their own risk. Sufficient customers would then have to be found for these as well.

As always, the option of Asia remains. The same applies here, albeit with the changed prerequisite that there is no summer break. Production is usually continuous and here, too, the question arises as to the stocks of raw materials. At least for cows, which for us are the main product for the Asian market, the business for furniture leather does not appear to have any particularly positive prospects and customers can obviously afford to wait and hope that prices will continue to fall.

Global suppliers, however, see little point in lowering prices at the moment and it does not appear that this could really stimulate demand for the time being.

As you can easily see from the above, there was very little to report on the week’s active business. Individual transactions occur again and again, but we did not see any serious increase in volume or clear indications that demand needs to be met.

The individual transactions moved in very narrow ranges around the last prices, although we do not necessarily deduce a stable and balanced market situation from this.

The kill: The lull also extends to slaughter. Volumes and live cattle prices are moving very little, so we can assume that supply and demand are largely balanced at the lower level. The school holidays will begin soon and this situation is therefore unlikely to change significantly until the beginning of September. However, the slaughter statistics up to and including April did not show any particularly sharp declines in the kill in 2024, as far as the figures available show.

What we expect: In our view, the facts are relatively clear and this means that things will continue to change very little, if at all. This is particularly due to the fact that neither the buy side nor the sell side feels any convincing reason to change the status quo much at the moment. Bargain hunters ask around, but not much more. This will probably remain the case for a while until at some point the pressure to buy or sell triggers new directions.

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