US Perspective - 15.9.15
15/09/2015
www.themaxfieldreport.com
The consensus amongst various members of the big packer trade is that limited offers from packers drew little interest from perspective buyers, especially with packers indicating they did not intend to trade under their last reported trading levels. We heard from a number of sources in the middle of the week that there was a fair amount in enquires / interest from buyers at $2-$3 under the last reported trading levels, but with packers convinced the market was no worse than steady, the majority of business was withdrawn.
Overall, popular opinion of the trade was that last week was not a particularly busy week of trading as there were a few isolated pieces of business written at steady prices, but not enough to equal even a holiday-shortened week of harvest. Worth noting, there were unconfirmed rumblings that at least a couple of packers indicated they would be willing to consider lower ideas at least on HTS / BRS, leading to speculation there may have been sales concluded quietly at levels lower than prices being shared publicly.
As to trading levels last week, HNS appeared to still be able to sell in volume at levels of $77 (FOB), while BBS prices were $75 (FOB) by the end of the week. As mentioned above, the “official” price of HTS / BRS was at $71 by week’s end; however, there were plenty of unconfirmed rumours of sales accepted at $77 delivered for HTS and $74-75 for lesser quality BRS.
Members of the cowhide trade report a difficult week of trading. Overall, sellers started the week with offers steady to a dollar lower than the week prior; however, with more than ample offers of cowhides coming out of Australia, Europe and substantial numbers of unsold wet blue for sale in Brazil, producers faced an uphill battle, especially on plump cows.
By the end of the week, producers in general were willing to listen to all ideas, and counters were running a couple of dollars under trading levels of the week prior. As to the number of sales concluded last week, opinions are mixed as to whether or not producers were able to sell their production last week, while prices were down roughly $2 and more (depending on the selection) across the board.
In regards to prices heard, we had trading reported on HNDC in the upper $50s and by the end of the week, trading came in at $58. Meanwhile, trading levels on HNC and HBC appear to have experienced the largest declines in respect to prices from the previous week, as we had sales on HNC at $42 (FOB) and HBC in the north at $35 (FOB).
THE LOOK AHEAD
As to our thoughts for this week, we tend to believe there is a good chance we will see a few more selections offered by packers, while we also suspect that we will see a few more quantities offered as well, especially HTS / BRS, while we suspect most packers still enjoy decent sold positions on HNS / BBS. What will be worth noting in our opinion is the shipping times on hides offered, as we continue to hear rumblings that some customers overseas have slowed their L/Cs [letters of credit] the last week to 10 days and suspect there will be a few more hides available to ship.
Meanwhile, the writing appears on the wall for those selling cowhides and appears sellers are in for another turbulent week of trading, even though the number of cows in the harvest mix continues to run at unseasonably low levels. That is leading us to look for more-than-ample offers and shipping timeframes within the next two to three weeks on some selections.
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