What happened this week: We thought last week that we were already in the middle of the summer doldrums and it seemed that people were only willing to raise their heads for a moment to check whether they were missing something. It is not as if there was a buying frenzy, but a few of the cold-blooded members of the trade were strolling around to see what their favoured suppliers had to say and to sell. This turned into a number of unemotional discussions about the situation and the future, and, in a few cases, even into sales at acceptable price levels. The public market did not benefit much from these mostly friendly and private encounters and most of the market gossip continued to be about claims, market problems overseas, the holidays and other negative factors that have slowly but surely started to change the opinion of the market ‘ignorants’ of the last weeks or months.

However, it might already be too late for some. It is the age-old story: that which was missed before the peak of the market cannot be regained afterwards, and certainly not in June or July. In our opinion, this is the key problem. Due to varied market opinions and selling patterns in April/May, many sellers are now in different positions, which is preventing any uniformity within the market. Different origins across Europe are already showing large discrepancies and this is also the case with different suppliers in the markets. Buyers are understandably using their ‘most favourable’ price indication and offer as the basis for their market assumption and, if the wrong buyer meets the wrong seller, the gap of (justified) opinions could not be wider.

Judging from experience, in such a distressed and disorganised mood, the market will need quite some time to regain its confidence and a common level of values for the different raw material origins and grades. The wide price spread is the largest obstacle to a final settlement. As far as business for the week was concerned, buyers were chasing the recent market favourites—dairy cows and low grades—and, when these weren’t available, heifers. Asian upholstery tanners and some bargain hunters remain the principal buyers. More interest was seen for lightweight low grades as patent leather fashion is still looking for very economical raw hides for prompt delivery and these are now only available in very limited quantities. Only the holidays in Italy and the closure of production from mid-August has made some hides available for other markets. Most other business is all ready for shipment in August or for delivery after the holidays and, for the medium term, price discussions with regular clients were much easier than the flea market negotiations they had been having with bargain hunters.

In the end, prices were mostly steady for dairy cows and low grades and a fraction lower on heifers. However, we might be even less representative this time than usual, as we also heard of sales that were a fair 5-7% below where we think the market is. A word of warning here: some of the reported deals could be linked to settlements of claims or other influences and may not be a real reflection of the price levels.

The kill: There is no change; good numbers of males with decent weights. Now entering the peak holiday season, we can only expect a declining slaughter in the coming weeks.

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