What happened this week: Fortunately this is the last week before the leather fair in Shanghai. As always after summer holidays the trade is missing clear indications for the rest of the year. As a result, everyone is concentrating on the show in Asia in the hope of obtaining the necessary information for buying or selling decisions for the next weeks. We see noting good in this trend, as an event like that is not decisive or indicative of volume and quality of the leather business for the forthcoming next months. Trading was reasonably light again and concentrated on European customers. Interest seen from Asia was retracted later in the week under the pretext that matters can better be discussed face-to-face during the show next week. There were several isolated sales this week, either load by load or just in renewing existing long term programmes, but discussions are not easy with customers at the moment. The necessary attempt to increase prices in euro terms is finding fierce resistance. Most tanners continue to complain about strong pressure on leather prices and expect them to fall even further in the next season. We think anything is possible and a couple of weeks from now we will know if we are back where we were some years ago. Overcapacity is inflating raw material prices and deflating finished product prices. As long as this prevails we will continue the wrestling between butchers and tanners and it will not be easy to return to satisfying margins in the short-term. We expect a little bit of relief from the currency market if the euro weakness continues and the currency perhaps finally breaks the mark of 1.20. This would at least create the opportunity to regain some of the increased abattoir prices with overseas sales. However, it cannot be repeated often enough that the market is not made at the European abattoir door but by the market leaders in the USA and Asia. Despite the high oil prices, which are fortunately correcting themselves at present, it seems that leather orders have quickly returned to normal levels after the reopening of the first tanneries after holidays. The next impulse and a basis of new information will be available next week when the rest of European tanneries reopen for production. The weekend will finally verify the situation once everybody is back on board. The kill: The kill is improving further. Latest statistics on beef consumption are proving that consumption per head is slightly increasing again. With weather conditions getting colder and wetter we are expecting numbers and weights to increase consistently in the near future. What do we expect? Next week will definitely be decisive after weeks where business has not been brilliant. The market needs confidence and a fair round of sales. This applies in particular to dairy cows. The rising value of the dollar is definitely a help at the moment. The most important thing for now is achieving satisfactory asking price levels and, hopefully, no bad surprises from the payment front will destroy the mood.
|
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 |
€ 1,55 |
Steady |
|
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 1,45 |
Steady |
|
Dairy cows |
15/24,5 kg |
22,5/23,5 kg |
13/22 kg |
20/21 kg |
€ 1,55 |
Steady |
|
|
25/29,5 kg |
27,5/28,5 kg |
22/27 kg |
25/26 kg |
€ 1,45 |
Steady |
|
|
30/+ kg |
33,5/35,5 kg |
27/+ kg |
29/31 kg |
€ 1,30 |
Steady |
|
Bulls |
25/29,5 kg |
27,5/28,5 kg |
22/ 27 kg |
25/26 kg |
€ 1,50 |
Steady |
|
|
30/39,5 kg |
36,0/37,0 kg |
24/34 kg |
31/33 kg |
€ 1,46 |
Steady |
|
|
40/+ kg |
45,0/48,0 kg |
34/+ kg |
38/40 kg |
€ 1,40 |
Steady |
|
Thirds |
|
