US Perspective—26.08.08 - leatherbiz: Lea Leatherbiz

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US Perspective—26.08.08

28/08/2008

US big packer hide prices slipped anywhere between $0.25 and $0.50 last week depending on the selection. It does not appear as if demand is keeping pace with supply. Overall, most believe that packers continue to possess a fairly strong sold forward position and it still seems that packers are reluctant to accept less money for their hides. However, a couple of packers who opt not to sell as far out as their competitors were reported to at least be a bit more willing to listen to buyers’ ideas during the last week.

Of course, a large portion of the US trade has departed, or will be departing, for Asia as we move through the remainder of this week and with so many people travelling, and the All China Leather Exhibition (ACLE) less than two weeks away, the general sentiment is that, even if prices are to correct any further, it will more than likely be limited.

Meanwhile, the US cow/bull trade remains in dire straits; prices were off anywhere between $0.50 and $1.50 in the last week, depending on the selection. A few of the sources we have encountered believe the majority of downward pressure has possibly passed. However, if other sources are correct, there is a huge unsold inventory of HNDC in producers' warehouses, and this has been supported by reports there are some very aggressive volume-type offerings of HNDC for those who are able to both buy and ship volume promptly.

There also appears to be a consensus that HNC remain under pressure, although not as severely as HNDC. We are hearing that bull production is exceeding demand and the general sentiment of the trade is that we will see bull prices continue to suffer some incremental declines.



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