What happened last week: Last week we experienced reasonable activity but once again it was not spread over the market segments as one would have hoped. Demand and sales were concentrated on cheap, light, extra heavy and top quality material which has been the case over the past weeks. One may question now what there is left to discuss as everything seems to be covered. In most cases it is Northern continental cows as they are neither particularly cheap, nor light, nor heavy, nor suitable for anything that is happening in the leather field at present. They are still predominantly used in the upholstery and garment sector but do not really perform. They are not good enough to play in the luxury league nor are they cheap enough to attract buyers to give them preference against more economical alternatives. Consequently, the sale of cows remains a challenge, which is still acceptable for the heavy ones but is a real problem for the lighter weights.

There is interest and even bids to choose from but nothing obtainable in the market fits the actual purchasing prices at the abattoirs. In figures most bids end up being about 5% below cost prices. With the argument of the low kill and positions, where inventories need to be protected but sellers are not yet willing to compromise, the volume of trading in dairy cows remains pretty small.

Another worrying factor is that hardly any bid from China is still on an L/C at sight basis. Extended terms ranging from 60 days to as much as 180 days for unconfirmed L/Cs are normal terms these days. This is similar to the mid-80s when 90 to 120 days drafts were the common payment terms for cows in Italy. However, we have to assume that most sellers are reconfirming the L/Cs with their local banks or are getting them covered by government institutions but it still does not put any positive light on the situation as such.

The light and cheap material performed well again last week. Artificial grains and prints allow for the use of low grade material. What started slowly in February is still gaining speed and those still disposing of the right material in the 2-15 kg range have found a ready market. Since we still have another two weeks to go until the Bologna Fair, where the season usually finds it climax, it is interesting to see how much more demand is out there and if any signs in the fair show a hint of a change in the fashion.

Other good news was the increasing demand for lamb and sheepskins. Prices being paid are lousy but at least one can see that at the present level the market has found a base and the interest is returning, particularly where shoe linings, boots and lower price garment nappa are concerned. Heavy bulls remained a nightmare with insufficient kills causing supply bottlenecks, which are generally not resolved easily. With tanners remaining extremely price-conscious, it has so far not even allowed any developments in prices.

The kill: Last week was another week of low kills. Slaughter remains low, and even relatively high live cattle prices are not generating enough demand for animals that are ready for slaughter. Cows are ready for the fields and there are simply not enough bulls available after the intense February kills. Perhaps there has not been enough demand for beef.

What do we expect? For heavy males, supply solutions and substitutions have to be found and we must see if the present imbalance will eventually lead to higher prices. If so, it will be a bumpy road, because tanners do not see supply as a price-determining factor anymore. How this contradiction is going to be resolved is unknown. The fight to get the right price for cows will continue and probably we only expect the seller’s position to improve slightly.  

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	Steady
	25/29.5 kg	27.5/28.5 kg	22/27 kg	25/26 kg	€ 1.35	Steady
Dairy cows	15/24.5 kg	22.5/23.5 kg	13/22 kg	20/21 kg	€ 1.45	Difficult
	25/29.5 kg	27.5/28.5 kg	22/27 kg	25/26 kg	€ 1.28	Difficult
	30/+      kg	33.5/35.5 kg	27/+   kg	29/31 kg	€ 1.18	Steady
Bulls	25/29.5 kg	27.5/28.5 kg	22/ 27 kg	25/26 kg	Share this story: Leatherbiz.com cannot be held responsible for content if the language setting is changed from English. The translations provided by Google Translate are automated and therefore might not be accurate and may contain incorrect, offensive or misleading language. We offer this facility as a guide only.