Osterhorn,
Friday, 04.06.2021
Market Report

The US $ in EURO
1,2180


What happened this week?: This week marks already the end of the fifth month of the year and only a few weeks remain before the first half of the year is over. No one will deny that a year ago we could expect that the development in the first months of 2021 would generally be so positive. Commodity prices around the world have risen significantly, the major economies came through the pandemic period quite well, and people have so far coped with the restrictions better than expected. The situation in the northern hemisphere is improving week by week and more and more people are returning to an approaching normality in their lives. The market for cattle hides, like many other commodities, was characterized by a very strong recovery. In fact, we have reached prices for cattle hides again that are higher than before the pandemic. Only the next few months will show whether this can actually be explained by demand for leather. In the spring of 2021, demand for cattle hides generally remained very stable, even though it moved from market to market. In this respect, we also experienced a situation this week that we have been seeing for many weeks. Business in Europe was very stable and the leather industry supplied its production at a steady level. In Asia, especially in China, the situation remained weak for us. The number of inquiries and the interest has increased again in the last few days, but the price expectations in combination with the increased freight costs and the currency situation still did not allow any business, unless one would be willing to accept stronger discounts in anticipation of expected, strongly decreasing prices in the near future.We are still in the second quarter, which is the transitional period between two seasons. It usually takes until well into the fall before it is finally clear under what conditions and in what volume leather demand can be expected in the winter quarter. At the moment, it seems to us that many orders in the leather industry are still being placed in order to secure the obviously more favorable prices of the past season already for a part of the demand of the coming season. Every manufacturer it is clear today that with the significantly increased prices for raw materials, chemicals and, of course, transportation, we can expect very difficult price negotiations and rising prices in the next season.It is therefore not surprising that standard articles and colors are hedged at supposedly attractive prices wherever possible. How the demand situation will really develop can hardly be predicted at the present time. As in previous weeks, our business activity was again almost entirely concentrated on the European market. The usual delivery programs for the coming weeks were completed this week or will be completed next week. At least for the month of June, there seems to be no decline in demand yet. However, for those hides that cannot find a home in Europe, the situation is deteriorating daily. It does not seem at all that the customers in Asia will accept the demand prices in the foreseeable future. In figures, this meant that prices in Europe did not change much. Price adjustments for price levels that no longer appeared to be in line with the market from the previous month took place and were adjusted in line with market realities. The lower slaughterings have not yet led to any significant sales pressure, so that even the very low bids from Asia have so far been avoided. This will probably have to change in the summer. The Kill:  Despite the reopening of the restaurant, slaughterings remain rather low and disappointing. The calculation in the slaughterhouses remains very difficult and the farmers also feel no serious increasing sales pressure at the moment. Weights remain surprisingly high for this time of year..   What do we expect: The market situation is not convincing and business and demand is rather dragging along. We are increasingly concerned about the growing price differences between Asia and Europe. These gaps have to be closed eventually and we would not be surprised if this happens in summer then


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

Steady
  25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 1,15
Toppy

Dairy cows

15/24,5 kg

22,5/23,5 kg

13/22 kg

20/21 kg

€ 1.00


Toppy
 

25/29,5 kg

27,5/28,5 kg

22/27 kg

25/26 kg

€ 0.90


Toppy

30/+      kg

33,5/35,5 kg

27/+   kg

29/31 kg

€ 0.80


Toppy
Bulls 25/29,5 kg 27,5/28,5 kg 22/ 27 kg 25/26 kg € 1,20
Toppy
  30/39,5 kg 36,0/37,0 kg 24/34 kg 31/33 kg € 1,50
Steady
  40/+     kg 45,0/48,0 kg 34/+   kg 38/40 kg € 1,45
Steady
Thirds 15/+      kg 25,0/27,5 kg 13/+   kg 24/26 kg € 0.50
Toppy
Thirds bulls 30/+      kg 38,0/40,0 kg 24/+   kg 33/36 kg € 0.60
Steady
 




We are increasingly realizing and have also been notified, that the content of our market report in full or in part is frequently copied and distributed or published without our permission. Apart from the fact, that we are honored by the interest our report consequently receives we would like to draw our readers attention to the fact, that the market report is covered by copyright law. We think, that it is not only bad manners to copy and use it without permission, but one should bear in mind, that copying and distributing without permission is a violation of international law. Please contact us for any questions in this regard to avoid misuse or misinterpretation of the content of the market report.






E-Mail: sturm@frsturm.com © Friedrich Sturm GmbH & Co. KG Web design: SKS online