What happened this week: Most of last week’s interest focused on the fair in Bologna and the impressions on the market sentiment and influences on its development. Attendance in Bologna was very much usual. The first and the last day were quiet but Wednesday proved fairly active with many one day visitors attending. The fair has not delivered any other news than what one already knew. It also has to be noted that the May show is more of a fashion pre-selection than a full-fledged trade show. However, those in the right leathergoods and shoe market niches (who supply the high quality and fashion market and have a selected customer range) confirmed that most of their clients had been publishing positive financial results over the last six moths. It seems that the order books will remain solid for the coming season too.

Although a positive development, we should not forget that its scope is limited to few big operations and a number of small specialty tanners, while the vast majority remains struggling against the existing problems of price and structural changes. However, the purpose of the fair has been served and the suppliers who came with the right (in this case light) material must have recorded positive sales results. As long as the raw materials were of high quality or on the cheap economical side for specific articles, tanners were willing to cover their needs for the coming months. The rest of the standard bovine selections remained in the same trading patterns as before. While bullhides are supported by the low kill and a steady demand from tanners, the processing margins for this item remain a problem. Falling average weights and low numbers are decreasing margins even further and, although hides are in short supply, it is still extremely difficult to convert this into rising selling prices.

Price negotiations carry on endlessly in this particular section. Standard cows could not gain much more confidence from the trade assembling. Even though their production has improved considerably one could sense the sellers were sensitive to the problems in the furniture business and, although prices did not move by much, suppliers were readily willing to accept all bids available at levels fractionally below market. Various rumours and offers could even create the impression that there are still a few ‘non regular’ positions in the hands of some traders that did not enjoy the Letter of Credits they were bought for. With the summer arriving shortly, some sellers do not seem to have the courage to hold on to their hides not even in view of the low slaughter numbers and so some were quietly searching for someone who has a more positive view on the future. Interest for ox/h remained steady but with hides available now discussions were pretty useless.

The kill: Things are getting tough. The kill was very low last week and now also cows are affected. With the holiday this week falling on a Thursday it is easy to imagine what can be expected. We think May is going to be a stressful month as far as customer supply and unit processing costs are concerned.

What do we expect? Supply management is going to determine the work in the next weeks. Since the market has become almost non-elastic to supply changes, there is little argument why prices should move for reasons other than coincidence. Most plans for the coming weeks have been made and sellers have so far avoided being pressed by excessive supply, while buyers are mostly covered. Chinese holidays taking place this week will also not add to the activity which will remain small everywhere.

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	Sluggish
	25/29.5 kg	27.5/28.5 kg	22/27 kg	25/26 kg	€ 1.28	Sluggish
	30/+      kg	33.5/35.5 kg	27/+   kg	29/31 kg	€ 1.18	Sluggish
Bulls	25/29.5 kg	27.5/28.5 kg	22/ 27 kg	25/26 kg	€ 1.52	Steady
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