What happened this week: It would need a fair bit of creativity to get any news worth mentioning out of this week. Activity was just a fraction better than in the weeks before and resulted in a few more hides being sold, so that at the end of the week an acceptable number of sales accumulated. Sales, however, were again patchy. Renewed programmes in Northern Europe, a few cows in Italy, some again going to traders, some bulls in Europe and on export markets, low grades and light weights – a bit of everything and nothing so pronounced that it would indicate any clear direction. The only thing missing – at least in our case – were significant order volumes from our regular customer base for dairy cows in Asia. This could be a case of them taking a wait and see position until the Shanghai Fair where all the usual suppliers plus some others will turn up at their front door. This is generally a situation that Chinese tanners like and it makes them more comfortable when it comes to bargaining and negotiations.

Chinese cow hide tanners also feel that the market timing is on their side with their supply markets in Europe and America just coming back from their holidays looking to find the base for trading after the long summer break. With decent shipments, which left at the end of July, they should be in a comfortable stock position for the next few weeks and are not in any rush to buy now when the whole industry will land at Pudong Airport shortly. So, it seems that they can take it easy and carefully analyse the leather market and see what impression they gather from the suppliers queuing up for an appointment. In side leathers, the situation might be a bit different because business still seems to be reasonably steady to strong and the hides needed for this production do not look as though they would be readily available to meet any extra demand. There is still excessive demand in certain areas such as high quality hides for vegetable leathers and there have been a number of enquiries over the last few weeks from the Middle East – simply because they can’t get enough product in the right quality at the right price from their regular suppliers and are now looking, mostly in vain, for new alternatives, Similar conditions apply to some other, smaller niches in the market. One can sense quite a bit of excitement this year prior to the trade meeting in China as more people than ever before are looking for the right direction to take and an insight into the market developments for the rest of the year. This applies in particular to the garment and upholstery businesses where things still remain quite uncertain. With many people to speak to in order to get an impression of the situation in many countries around the globe, it may also offer us a better indication of the potential influence of the rising energy costs and the effect on production and retail.    

The kill: The kill, in particular for bulls, fell back a bit this week. Also hide weights were again significantly lower and we have absolutely no clue about the reasons for this. Maybe it was just the warmer weather. There are no new indications about the kill in the short term and we have reason to believe that there should be any major variations in the coming weeks.

What do we expect? Slowly but surely market activity in Europe is going to normalise. On the other hand with most of the trade now preparing to travel or already travelling to Asia it means that everyone is now in a wait and see position about the ‘results’. The US$ was again of no assistance and it doesn’t seem it is going to be in the next weeks either. So, for the coming week we might just see some standard trading activity in Europe and a ‘wait and see’ attitude for the other markets.

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