What happened this week: Business this week has returned to a normalised pattern in terms of volume. Bids and sales came in regular volumes but business on the export side was still heavily burdened by the weak dollar which had reached record lows. Consequently, many of the bids from Asia had to be turned down because they could not match current abattoir price levels. A thing worth noting is that Asian buyers are increasingly inquiring for better quality materials. Speculations prevail but the most likely reason for this is that they are losing the medium quality market. The future will show if these tanners, unfamiliar with the characteristics of European hides, will be disappointed or whether their expectations will be met. Some hide descriptions are reported to promise more than they can deliver, especially when one lacks experience with the product. Most volume interest this week has come from traders and some have the courage to build a long position for 2005. It will be interesting to see if this is the right move. Looking at historical price ranges of the dollar, we are not far away from long term support levels. This is no justification for anything and one has to bear in mind that the currency market has a strong correlation factor. It is, therefore, hard to be very positive about the coming weeks. As usual, with the start of December we are beginning to see the normal congestion. While in the Western World businesses are preparing for the Christmas break, the Asian customers have their Lunar New Year in sight. Hence all shipments to Asia should preferably leave by week 52, before a long shipment break takes place until mid January. As needs to replenish cannot be met before the end of the year or sometimes even January, most buyers are currently acquiring products to see them through to the end of January in Europe and the end of February in Asia. The trade in Europe this week has focussed on light weight material again. Business is not easy here either but at least customer relations, maintained through difficult times, are now paying off as the clearance of goods continues and the outlook for the first quarter of the new year remains good. In conclusion, the market remains the same with side and vegetable leathers doing well and upholstery struggling with the uncertain future of the dollar adding suspense to the situation. The kill: Still quite strong with no sign of easing. With Christmas falling on a weekend this year and no holiday shortening the last week of the year, we do not expect any extraordinary decline until the end of the year. The slaughter mix still favours cows and heifers, while the kill of bulls is about normal for this time of the year. Many are already looking into the new year: speculations regarding January and February numbers already exist. What do we expect? Trading in the next weeks will slow down. Business may pick up again towards the end of the year when tanners need to budget their needs for February/March. The market is currently showing more resistance against further declines but, as long as other markets remain still, we will continue to be predominantly currency driven. With a grim outlook for the dollar, hopes for the hide market are also limited.
|
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 |
€ 1,45 |
Pressure |
|
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 1,35 |
Pressure |
|
Dairy cows |
15/24,5 kg |
22,5/23,5 kg |
13/22 kg |
20/21 kg |
€ 1,35 |
Pressure |
|
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 1,25 |
Pressure |
|
|
30/+ kg |
33,5/35,5 kg |
27/+ kg |
29/31 kg |
€ 1,15 |
Pressure |
|
Bulls |
25/29,5 kg |
|
