Osterhorn,
Friday, 15.03.2019
Market Report

The US $ in EURO
1,1320


What happened this week?: The fair in Hongkong also history now. We are entering now a long break when most people in the business just have to manage their standard routine. The fair in Hong Kong was generally pretty well attended and it is still not the headcount what plays the important role to judge such an event. For a visitor or exhibitor it is always very difficult to really understand what such an event means eventually, but having spent three days we have come to the conclusion that global tanneries continue to stem against the general trend. However, if something has to be recognized that it is the lack of visitors and exhibitors from the mainland China. One would expect that Hong Kong is a location which is convenient and offers the industry from China very attractive opportunity to show and to present their work and products to the international audience. Very little of this has been seen in only the few well known and large operators were actually really represented. Consequently was the attendance generally dominated by the same international traders and producers which you see there already for almost the entire history of the event. From our perspective we have left with the impression that the staff understands had been in most cases pretty busy and if this was for the sake of selling leather or just entering into a dialogue with suppliers and customers is actually not matter so much. We found also remarkable was that most people we met had finally arrived to a state of realism. The raw material trade in the past used such events in a particular the fair in Hong Kong generally to spread around the usual stories of success and optimism to pave the way for better deals and higher prices. Although this failed many times it was tried again and again. This time we did not see much of this. Most people were just discussing the situation as it is and trying to analyze if there could be any kind of exit strategies. We have heard many opinions, but actually very little is really convincing. The main concern of the vast majority of raw material suppliers has and must have is to make sure that their supply is sold on a regular basis and last but not least also paid for. Without going too much into detail the main problem still persists in the low grades and low price hides and very particular existing stocks of semi finished material of the bottom end of the range  continue to struggle to find any kind of a solution. Interesting enough there is a little ray of hope with sales of low grade hides to China at better prices than before. The main reason is the reasonable price for gelatine splits deriving from cows which allows lime selection, pick the 'beauties' for leather  and have a good return for the hides in average what is much better than trying to use them all for the leather production. For the rest of the game it was difficult. Prices were asked, but none of them were really attracting anyone. Some came with an unspoken optimism for cows after the stable market in the previous weeks and the good clearance in January. We tend to believe that any attempt to raise prices and to sell volume was unsuccessful. Actually the agents were around and they had obviously asked by the tanners to collect information, but they were not sent with orders to buy were they busy chasing the clients on WeChat trying to negotiate. so, the bottom ine was that sellers are hoping to hold prices stable in the coming weeks and Asian buyers being convinced that they can buy cheaper if they dont rush and it seems that until this week they did not need to. At the end most sales were made in Europe. Most activity was for specialties and niches and the trip was good to obtain a general picture and to meet business friends from around the world. For the targets in Asia we tend to believe it was not very succesful. The Kill: The kill continues to stroll along. Carnival has passed and now we are waiting for Easter. In general the kill will as always now hoover from low season to low season in Europe. Weights will fall and all will only turn around only after the summer.  What do we expect: We hope for the surprises, but it would one if next week suddenly everybody is going to need hides. The tanners who have business buy their regular volumes and expect still price concessions. The big slump might be over, but all hides still do not find a buyer. The hope is to hold the prices steady and selling all the hides.


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 € 1,60
Stable
  25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 0,90 Stable

Dairy cows

15/24,5 kg

22,5/23,5 kg

13/22 kg

20/21 kg

€ 0,70

Stable
 

25/29,5 kg

27,5/28,5 kg

22/27 kg

25/26 kg

€ 0,60

Stable

30/+      kg

33,5/35,5 kg

27/+   kg

29/31 kg

€ 0,55

Stable
Bulls 25/29,5 kg 27,5/28,5 kg 22/ 27 kg 25/26 kg € 1,40
Pressure
  30/39,5 kg 36,0/37,0 kg 24/34 kg 31/33 kg € 1.40
Pressure
  40/+     kg 45,0/48,0 kg 34/+   kg 38/40 kg € 1.25
Pressure
Thirds 15/+      kg 25,0/27,5 kg 13/+   kg 24/26 kg € 0,40
Stable
Thirds bulls 30/+      kg 38,0/40,0 kg 24/+   kg 33/36 kg € 0,60
Weakish





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