What happened last week: The story from previous weeks is repeating itself. Business activity seemed quiet and interest was almost non-existent. Those with product available on the sidelines i.e. low grades, lightweights and other odd items that belong to the full range hide business, found a decent volume of bids and business last week, but looking at the mainstream items and the European market activity, one could indeed become quite depressed.

As regards volume products, Asia was the only driving force and isolated interest was found for dairy cows and lighter weight bulls. Sales were dependant on buyers’ personal views on future market developments and several ‘take it or leave it’ decisions were made. We obviously favoured the ‘take it’ position and, as long as our price expectations were met and shipment covered for the holiday period in Europe, we decided to sell and not to bet on what might happen in the future. This may prove wrong in view of the dramatic fall in slaughter numbers and those holding onto their stocks might eventually benefit. However, faced with the choice between constant shipping versus potential market gains, we felt more comfortable settling for continuity over the unpredictable.

While market developments in Europe will depend greatly on the next round of abattoir buying and on the tanners’ attitude to the present supply bottlenecks in heavy and good quality bullhides, we are less confident about the ‘bread and butter’ business of average quality dairy cows awaiting shipments to Asia in the next eight weeks, as Italian tanners will be no great assistance in clearing production. The question mark looming over the market derives from the rumoured inventories that exist in the trade. Everyone seems to have a tale to tell, but  only time will tell whether stocks really exist or if they are merely market gossip spread by troubled suppliers desperate to secure customers in the current market.

A hot summer could boost the confidence of those hanging on to their stocks in the hope of gaining significant profits due to the low kill. The end of August may well put a stop to our current worries. Yet little seems to be changing in the leather business. There is a strong and steady demand for everything light and cheap and the first bargain hunters are already starting to enquire about offers in sheep and lamb. These enquiries are tentative, as they are currently only looking for those desperate to dump material for almost no money, but, some interest is better than no interest at all.

Sales were fairly good due to isolated large sales overseas, although interest was far from broad-based. The end of  the week once again turned out to be better than expected. Sadly, another well known tannery in France had to find protection under chapter 11 last week.

The kill: The kill remains a disaster. In some regions the numbers declined by as much as 40%, creating bottleneck situations in several categories. Beef consumption and prices are falling rapidly and the availability of cattle is going in precisely the opposite direction. The situation should remain the same until September.

What do we expect? The firmer dollar will once again support the market, but the fundamentals remain in place: dairy cow hides will be hard work, while males and good quality hides will fare better due to the low supply. As far as prices are concerned, currency continues to lift the pressure.

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	€ 1.35	Steady
Dairy cows	15/24.5 kg	22.5/23.5 kg	13/22 kg	20/21 kg	€ 1.52	Steady
	25/29.5 kg	27.5/28.5 kg	22/27 kg	25/26 kg	€ 1.32	Steady
	30/+      kg	33.5/35.5 kg	27/+   kg	29/31 kg	€ 1.16	Steady
Bulls	25/29.5 kg	27.5/28.5 kg	22/ 27 kg	25/26 kg	€ 1.55	Steady 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.