New blog entry: the hide trader’s role has gone
05/11/2015
In his monthly column for November, Mr Peters puts forward in typically forceful terms the idea that the global leather industry no longer has any need of the traditional hide trader and, instead, now requires brokers to act either as a domestic representative for a particular supplier or customer, or as a sales representative, if it needs an intermediary at all.
In the column, which you can read in full here, Mr Peters says: “The industry is now transitioning to one main group, namely companies that either produce or control product (Producers and Processors) with the rationale that the role of trader is decomposing quicker than a raw hide.” He adds that, while a good broker can smooth the flow of hides between packers and tanners thanks to good customer relationships, the trader “merely piggy-backs local knowledge and initiative onto arbitrage transactions with producers”.
He goes on to say that with footwear and automotive companies “beating a constant drum of inventory management, flexibility and just-in-time processes”, there is very little room for speculation or an intermediary who gambles on the market’s possible movement. “The glory days of traders providing speculative coverage and supplier liquidity are truly behind us,” he insists.
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