This week: Unless there is a surprising surge in activity in Asia, there is little to say in market reports from mid-July to mid-August. While there used to be surprising events from time to time, even during the holiday season in Europe, this has almost completely disappeared in recent years. The leather manufacturers have covered their reduced production with raw materials and are therefore almost completely absent from the market for several weeks. Of course, there are always the odd chance that something can arise from individual situations, but this has nothing to do with market activity.

The number of available dialogue partners in Europe will now also fall considerably until the end of the summer holiday, which is to say for the next two or three weeks. Demand and procurement are based on orders for leather and only those who believe in real miracles and surprises can assume that there will be any significant activity in Europe before the end of August.

In Asia, the situation is somewhat mixed overall. While the main focus is on China, and specifically on the production hubs in Hebei and Shandong, there is probably not much good news to report at the moment. The business situation there is poor, which is reflected not only in a general reluctance to buy, but also in the well-known background noise in this market when prices fall and orders are lacking. Otherwise, China is focusing on low-priced raw materials and trying to keep prices down wherever possible. In the opinion of the tanners, the supply of raw materials still exceeds the demand for leather, so the parameters for the market situation are actually set.

Of course, this is only true for those who see the situation the same way and there are still those who express a different view and expect a trend reversal in autumn.

Selling was again rather random this week. The volume buyers did not appear on the market and most of the business was done with specialists and niche producers, which is in no way representative of the market trend.

The kill: The kill fell considerably this week, which is of course due to the start of the holidays in our region. In the coming weeks, too, we expect at most slight changes at the reduced level. Meat production is only supported to a small extent by local demand. Milk prices have now reached a good level again and the weather conditions for grazing cattle in northern Germany are exceptionally good. As a result, a significant increase in slaughter activity is not expected until mid-September.

What we expect: As the general environment in the global leather market remains unchanged, we do not need to cite any arguments that could trigger a trend reversal. We are now approaching critical price levels at which the collection and processing of cattle hides may no longer be economically viable. Further price pressure and a further slide cannot be prevented with this argument, but in the medium term it could actually lead to a reduction in supply. However, we are not alone in the world and this may not lead to a stabilisation of prices. It is the holiday period. We therefore expect that not too much will change between now and the All China Leather Exhibition in Shanghai, September 3-5. But the pressure on prices should continue.

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