US Perspective—25.11.08
25/11/2008
Last week’s hide market ended with a steep adjustment in steer prices. The average steer price on the JPG was $44.75, down $11—nearly 20%—from last week’s average price of $55.75. This compares unfavorably with a decline in cows of 14.5%, which saw its weekly price drop $2.84 from an average $19.50 to $16.66.
This abysmal decline was reflected in the mood of traders as they manoeuvered through the uncharted challenges of last week’s market decline. Export numbers reported for week ending November 13 for hides and wet blue were respectively 655,400 and 89,300—a total of 744,700. These numbers exceed the previous week’s kills of 616,000 by 128,700 pieces, or 21%. Export versus kill can be a reliable leading indicator for future market prices providing input data is correct and in our industry there is proper accounting for cancellations.
Hide market activity today was minimal with continued price pressure. Steer prices dropped $1–$2 in some selections.
The Dow Jones Industrial Average rebounded for a second consecutive day by 397 points to 8,443 on news of president-elect Obama’s appointment of Timothy Geithner as Treasury Secretary, and the announcement of his team of economic advisors, as well as the government’s rescue of Citigroup.
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