Friday, 15.11.2019
Market Report

The US $ in EURO

What happened this week?: With this week already half of the month of November is over. Actually this leaves only approximately four weeks to go before the year and decade is closing its curtain. Actually we have seen one of the longest bear market trends in history and in the course of the past weeks the trade is questioning if this trend this over. In many markets we see stabilising trends and for some grades here and there prices have even bounced back from their lows seen during the summer. However, the general market pattern seems still to be completely intact. The total leather demand has significantly declined and this is a trend which we see already for the past years. Under the lead of the shoe industry leather consumption has actually shrunk and this trend has been unevenly spread over the entire offer of raw materials. It is certainly too easy just to summarise the trend in the better is better and the worse to be the bad, but in aggregation it is a tolerable scenario. The hide types which are in direct competition with plastic can still find sufficient demand absorbed in the rising slaughter the main supplying regions adding to the problem the balance.For us in the general European market we are reflecting pretty much the same micro customers. Renderer hides are low grades struggle to obtain sales prices which are covering the collection the processing costs while cows and heifers have established a very stable and solid price/quality ratio. For male hides situation is a bit more complicated, because the fresh and chilled uniform quality production find sufficient interest and demand from the European tanning industry while any surplus what has to be sorted across Europe struggles to find customers. Tanners overseas to simply not need to pay the same price levels obtained in Europe, because they are not producing the leather types with such kind of raw material is either required or find the match in the leather prices the tanners can get. In the simple terms of the market this means that there is adequate interest and sales potential for the female hides while for the male hides a certain section part of the entire supply struggles. This does not apply all over Europe, because also here we have regions where the prices are more adequate than in particular in Germany. For the week and in other words means there is an option for the quality suppliers to sell more females at steady prices while finding a home for the excess lighter weight males continues to be the struggle.Since we are already well into the winter season most of the tanners are ready reasonably well covered for a different period of time. Why the European tanners are most likely safe with the purchase programs until the end of the year are their Asian colleagues safely covered until the Chinese New Year break. Origins with an attractive quality price ratio have even today the chance to extend their sales, because many leather producers find an attractive margin when they dispose of sufficient order books. So, why risk and many of them prefer to lock the profits in. With the abundant supply buyers can still choose and select and sellers has to realise that too much ambition on price quickly sanctioned with disappearing interest. Sales for the week were rather spotty with some interest for cows and heifers across the full range of weights. In Europe sales were limited once again to renewals of the standard programs.. The kill: The kill is pretty good now in numbers have reached that pretty solid seasonal level. The ratio of males continues to be falling while at the same time the average weights are significantly higher than before. We call still to come in the Christmas season ahead of us it is pretty likely that we will see the same scenario for the next 4 to 6 weeks.  What do we expect: Also for the coming week we have absolutely no reason to justify any substantial change. We are interested to learn when the Chinese customers are willing to seriously discuss second half of December shipments for arrival after the holidays and what they will pay.

Type Weight range Avg. green weight Salted weight Avg. weight salted Price per kg green weight Trend
Ox/heifers 15/24,5 kg 22,0/23,5 kg 13/22 kg 20/21 kg € 1,20
  25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 0,65 Stable

Dairy cows

15/24,5 kg

22,5/23,5 kg

13/22 kg

20/21 kg

€ 0,65


25/29,5 kg

27,5/28,5 kg

22/27 kg

25/26 kg

€ 0,50


30/+      kg

33,5/35,5 kg

27/+   kg

29/31 kg

€ 0,45

Bulls 25/29,5 kg 27,5/28,5 kg 22/ 27 kg 25/26 kg € 1,15
  30/39,5 kg 36,0/37,0 kg 24/34 kg 31/33 kg € 1.15
  40/+     kg 45,0/48,0 kg 34/+   kg 38/40 kg € 1.05
Thirds 15/+      kg 25,0/27,5 kg 13/+   kg 24/26 kg € 0,30
Thirds bulls 30/+      kg 38,0/40,0 kg 24/+   kg 33/36 kg € 0,40

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