Hide market still under pressure
09/10/2007
Friday’s activity and interest provided a fitting close to what has been, according to our sources, a lacklustre week of trading. We found it difficult to uncover anyone who was claiming to have sold a lot of hides this past week.
Of course we did hear the usual rumours accusing some of the packers of selling at lower levels, and some of these rumours, if you care to believe them, included HNS trading at levels of $70 delivered to Italy and HTS selling in South Korea at $69.50. There were also rumors of BS selling in Taiwan as low as $68 delivered.
Overall, from the discussions we have had this week, it appears that the general sentiment of the trade is that the market remains no better than steady. Most would concur that prices are roughly 25 to 50 cents lower this week than last. This is reflected in our price index this week, which checks in with a weighted hide value of $63.85 which is $0.28 lower.
Meanwhile on cows, prices appear to have succumbed to the pending pressure this week as we have had reports that suggest sellers were struggling to equal their trading levels of last week. Opinions that cows were a bit “over-priced” appear to be coming to fruition.
Trading levels we have heard this week include HNDC trading somewhere close to around $57, while HNC are checking in around $49-$51, while HBC have traded in a range from $42-$45.
The one selection that still appears able to hold its value are Bull hides. We have heard reports of Native ranging from $62-$64, while Brands appear to be worth roughly $58-$60.
In the meantime, even small packer hides and kips have fallen victim to the downward pressure as we have trading on small packers checking in from a range of $51.50-$53 this week, while kips appear no better than $52. There are rumors of some product sitting on the dock in Italy that is in need of a home.
As we look ahead to next week, it still appears from our vantage point that the pressure to accept lower trading levels on hides will most likely not subside, while we continue to hear that there are more than enough producers who have at least one or two key selections that they would like to sell and these hides could ship relatively quickly.
This—in conjunction with reports that business is a bit slower than tanners have anticipated, coupled with tanners in China still attempting to deal with pollution issues—is why we tend to believe that we will more than likely see the hide market remain under pressure moving forward.
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