What happened this week: Yet another week where it was fairly difficult to get a clear picture of the market. We think the situation of the good and the bad, the successful and the unsuccessful, the courageous and the less so is drifting further apart. What can be seen clearly is the big difference between the situation in the medium and higher shoe upper field and the volume production of furniture leather. Heavy substance side leathers, as well as high quality bad leather, are still enjoying strong demand from European specialist tanners and prompt deliveries are requested – in particular for wetblue. However, not very many hides qualify and since it is a small part of the whole market, the total volume is not really a significant influence. Furniture leather is quite the opposite. Cheap finished leathers from overseas suppliers such as Brazil and China are the topic of discussion at the moment as is price pressure, as confirmed by the small fair in Coburg (Germany) where price seemed to be the only item of interest to everyone. So, there are hardly any sofas being made from leathers of reasonable quality, which makes the sales of medium quality hides at current price levels even harder. Price levels of €1.10 per square foot for finished leathers are mentioned frequently. The trend of a weaker dollar continued, making calculations for hides from the Euro zone even more difficult. Some isolated interest from Asia was seen again in the second half of the week, mainly for cows, but prices were mostly unacceptable and approximately $2-3 below current asking levels. However, if these prices become reality we will lose more than 10% in price and another 3% in currency when sales to Asia are calculated. In Europe the drop was not as sharp but a) who knows what to expect next b) the prices were lower already. Sales were not particularly strong during the week. In Asia most of the buyers were still in a holiday mood and many others on overseas trips. Furniture tanners are waiting for the results from the fairs. In Europe business in heavy males was only just acceptable and fairly isolated for females. Low grades were sought. In these market conditions the abattoir buying prices can be called cynical at best. Although prices came down by a few euros, it is far away from the correction required to bring the market back to adequate levels. It seems that many continue to ignore the global price trend and the currency markets. The consequence of that, as earlier in history, will eventually have to be managed. The kill: Levels are currently good but not yet on seasonal highs. With colder nights ahead of us we expect the kill to increase further in the weeks to come and weights should also start to increase. The pressure on abattoir margins is also high at the moment, making it harder to deal with butchers. What do we expect? In the next week we should see a little more interest form Asia again. However, it will be hard to defend the present asking levels for cows in the current market environment. Bulls seem to be doing a bit better and we believe that sales will be satisfying at prices which will reflect the marginal declines in the buying prices.
|
Type |
Weight range |
Avg. green weight |
Salted weight |
Avg. weight salted |
Price per kg green weight |
Trend |
|
Ox/heifers |
15/24,5 kg |
22,0/23,5 kg |
13/22 kg |
20/21 kg |
€ 1,50 |
Weakish |
|
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 1,40 |
Steady |
|
Dairy cows |
15/24,5 kg |
22,5/23,5 kg |
13/22 kg |
20/21 kg |
€ 1,45 |
Stabilizing |
|
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 1,38 |
Stabilizing |
|
|
30/+ kg |
33,5/35,5 kg |
27/+ kg |
29/31 kg |
€ 1,23 |
Stabilizing |
|
Bulls |
|
