With such a wide variation among the tanners, the daily mood pretty much depends on who one talks to. Listing the positives on one side and the negatives on the other, however, the negatives list is longer. As usual, the situation is not equally shared and the situation around the globe is not the same. While the European upholstery tanners are the biggest complainers today, business with Chinese buyers of furniture upholstery is still reasonably steady and the sales of quality dairy cows at a certain price seem to remain pretty constant for the time being. While in Europe shoe and leather goods tanners are still reasonably busy, the Asian market for these items is rather quiet. Automotive still seems to be linked to models and makers and some are busy while others are far less so. All this is pretty seasonal, but it is early days.

 Tanners are normally still pretty busy in June and by the end of the month the summer slowdown will start, and this seems to have been anticipated this year. The key question is whether an accumulation of hides has started and this could turn the present slowdown seen since April into a reverse trend and become more than just a correction of some overvalued raw materials. Well, one has to start to consider this option. Although everything still seems to be in good order, a few changes can be seen.

Ovine skins are constantly making more inroads into leathers for shoes and leather goods. This segment also seems to welcome more alternative materials and the order situation does not seem to be as strong as it was a year ago. All over, upholstery tanners are facing massive margin problems and with the end of the season approaching, many are scratching their heads as to how to get out of the squeeze. This certainly won’t be achieved by buying overpriced raw material as long as there is little hope for rising leather prices. So, there are many factors pointing to the conclusion that the inflated optimism is deflating a bit, although we could not say that the situation and the demand for leather is completely poor. It is just less exciting.

Sales this week were quite decent. Thanks to some regular sales and the Asian interest for dairy cows the numbers were sufficient. The $ helped a lot towards the end of the week, while more price concessions on heavy materials had to be made. Butchers are stubbornly defending the abattoir price levels and, with the help of some trying to protect their stock values, they are also quite successful.

The kill: The kill is at normal seasonal levels. After a one-week wave in the slaughter of bulls, the production dried up again and the balance between males and females is in normal order again. With the weather getting warmer again, the kill will probably reduce further.

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