What happened this week: This report is obviously not covering only the last but the last three weeks. The assumption, that we would have a long, quiet and relaxing break over Christmas and the New Year might have been right until Christmas Eve, but with the first BSE (detected and published) case in the USA the situation changed in an hour. The reaction was as one had to expect with the experiences we made in Europe three years ago. Stress and concerns which were close to panic in the first days and I think we were happy, that it happened exactly when the Western world was entirely in Xmas mood and not willing to bother too much about such things. So, most of the excitement was left to the Americans and the Middle and Far East, while the Europeans took it very easy, if they noted it at all. Those who were not closed due to Christmas tried to get hold of their suppliers in Europe, to discuss supply options and security purchases. The ones willing to accept phone calls and 

working on e-mails had a busy Xmas, but at the same time also the chance to book some business. This continued almost until the New Year and only then, the hype started to slow down again. As far as prices are concerned, fair values were obtainable and what buyers refused a week earlier was accepted then. However, most of the gains were absorbed over the days by the rapidly falling USD, and not being able to cover the currency immediately, could carry a large proportion of price increase away. The New Year started then much more quiet and Europe basically resumes to full work only next week. European tanners are taking things very easy at the moment. They are by far more interested in the influences of the strong € on their export business rather than possible turbulences in the raw material supply. It seems, however, that inventories in Europe are better than in Asia and consequently tanners don’t see the immediate need for action. This might change from February onwards, because a number of visitors from Asia are announced, who have now

and finally understood the reason to take European hides into consideration. Not just for price but also for security and flexibility in their raw material supplies. Since cows and heifers of European origin have already reached significant levels of exports overseas, will the negligence of bulls now also become history. This will certainly change trading patterns in Europe again in the medium long term.  The kill: The weeks over Xmas and New Year were very quiet with only a day per week with normal slaughter. 2004 starts with good numbers in the first days and it seems, that we might see better kills than expected in January. What do we expect?: Next week the market has to proof the extend of the BSE factor and if the reduced slaughter in the USA will force further buyers into the European markets. If so, we have room for price increases in the next weeks. Definitely more on cows than on bulls, but traditionally one is always dragging the other. However, the optimist should bear in mind, that hide prices in USD are not cheap and so the risk is rising that leather production will suffer eventually when existing orders expire.

Dairy cows

15/24,5 kg

22,5/23,5 kg

13/22 kg

20/21 kg

€ 1,75

Firmer

25/29,5 kg

27,5/28,5 kg

22/27 kg

25/26 kg

€ 1,42

Firmer

30/+      kg

33,5/35,5 kg

27/+   kg

29/31 kg

€ 1,27

Firmer