This week: Last week presented a completely normal picture for a week before the summer holidays. The remaining deliveries and necessary administrative work are being completed in the leather factories, and beyond that, there is very little activity in the raw materials markets in Europe.

Basically, the impression is growing that everyone has either resigned themselves to unchanged prices until the end of the holiday season, or perhaps even considers this desirable. There is no need to revisit the pros and cons at this point, as major price changes would not alter the market situation and would cause more unrest than provide new insights. Instead, attention is focused on questions such as how the leather industry will fare in Europe after the holidays and in the coming years.

Further changes are on the horizon and it is highly likely that we will hear about some changes in the coming months. In Europe, pressure on leather products remains high, so it came as no surprise when one of the larger French car manufacturers announced that it would be phasing out leather. However, their vehicles were not major consumers of leather anyway, so the impact on demand will not be particularly significant. Nevertheless, it is another signal that affects the mood.

In this respect, it was gratifying to learn that the German leather industry association, VDL, has won a court case against the misuse of the term ‘leather’. A court has ruled that the term ‘leather’ may not be used for products made from other materials. We can only hope that this decision will remain valid in the long term.

There was interesting news from China, which gave rise to some hope, at least for the local market. Some believe that the central government’s new five-year plan (2026-2030) will include a variety of stimuli for domestic consumption in order to offset the decline in exports. The purchasing power of 1.4 billion Chinese consumers, who have no problem with leather as a material, would be considered sufficiently attractive under the right conditions. Incidentally, there is also a view that, with the current low prices for raw materials, leather can certainly compete on price in China today. This explains why Chinese customers, although extremely price-conscious and aware of their importance as buyers and for the market, are still actively seeking extremely cheap hides.

Our business this week consisted of the first small quantities for the first few weeks after the holidays and the odd truckload or two, which was then needed to cover the last few small production gaps. Prices remained virtually unchanged, with only marginal changes.

The kill: Slaughter remains at a very low level and is hardly changing. In our region, the school holidays begin the week after next, which will probably put further pressure on slaughter. No one yet knows what changes the German slaughter industry will undergo in the coming months, but there are almost daily reports confirming that major changes are on the horizon. Furthermore, there are concerns about the prices for live cattle after the current fattening phase, because the available data suggests that significantly higher prices should be achievable. Whether consumers will accept this is doubtful, to say the least.

What we expect: It is not particularly difficult to deduce from last week’s reports that we can hardly expect any major price changes in the coming weeks. However, as no major increases in sales are expected and the Chinese market remains closed to us, this stability may be purely theoretical, as it is not backed up by actual active sales. Nevertheless, this does not change the fact that we are convinced that remarkable changes are imminent in the industry in Europe over the coming months. The impact these will have on the price structure will probably be determined more by the global market than the regional market.

Price Table

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