What happened this week?: In many ways we are passing another very difficult period. On one side, many governments are easing restrictions related to the coronavirus. On the other side, the virus continues to spread. Countries which, at the beginning, were hoped to evade the pan-demic have become the new hotspots. 

Also in Germany, despite a low infection rate in total, new clusters are detected week by week. The media focus remains on outbreaks in slaughter plants, but there are also some in various apartment blocks across the country where people are living in dense environments. New lock-downs had to be declared; while some parts are enjoying a relatively normal life, others are fall-ing back to something we thought to be history. 

The holiday season has started and gets slowly into full swing this weekend. German holiday resorts are generally fully booked, but the reduced capacity has to be considered. The first reports from those offering accommodation and running retail shops are quite positive. In their vacation time people have not changed much from their traditional habits. Other destinations which Ger-mans can reach easily by car report similar patterns. What we don't know yet is how the people are going to spend their money during the vacation. We also don’t know what will happen to those who traditionally book a package tour by plane. Will they find a new place to go or will more people stay home this year? By the end of July, it should be possible to draw a first bottom line, and by the end of August we will know the facts.

Business activity this week was a bit strange. We saw quite a few statistics which were trying to deliver the impression that the bottom of the catastrophe has been reached. However, this has not yet fully converted into confidence and optimistic planning along the leather supply chain. Every-one is looking for security that can't be offered under the circumstances. Most if not all tanners continue to complain about missing orders. It might be the wrong time of the year, but the manu-facturing level as well as retail — and the world as a whole — are living in the moment. This might be understandable, but it does not justify the ongoing delays of decisions and the lack of creativity to look for options and opportunities for business and for the future.

Taking no action is certainly the worst of all options. Apart from the usual bargain hunters from China we had numerous enquiries for information and quotations from people we haven't heard of since March. This means they are beginning to understand that at least a certain amount of market research has to be done. Unfortunately, most of these people were not willing to under-stand that raw material will not be for free. It is unlikely that even lower raw material prices will stimulate any kind of new and additional demand for leather. So far it is rather more of a reflex not to miss any great opportunity — with or without leather orders in hand or expected. 

The main driver this week was again less from demand for leather rather than from speculation or supply management for the summer production of gelatine and collagen. A bit more interest and demand was seen from the automotive pipeline; there, no matter what, productions have to be lifted a little to match with the production plans of the big vehicle factories. Prices for business concluded remained completely steady.  

The Kill: The total kill remains relatively stable if not a little higher than what we know from the past for this time of the year. However, the shutdown of one of the biggest meat processing plants in Germany is deviating supply and delivery chains, which has an effect too. Hides in av-erage continue to be heavier this season than the years before. 

What do we expect: We get, in general, a bit more positive when it comes to demand. We be-lieve that here and there some inventories of selected items have to be filled.

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