With the end of this week, the last federal states in Germany go on school holidays. This also affects most of the leather factories here. This was also noticeable this week as a whole, because people were almost exclusively busy with the remaining planning and clarifying things that are important before the holiday and for the first days afterwards. From a business point of view, one can actually almost completely dispense with market reports at this time of year. In the past it was a bit different, because the holiday season in Europe either led to a significant increase in shipments to Asia or, in addition, to a significant increase in demand from there. This year this is only the case to a very limited extent. For us, in any case, the level of both shipments and business is clearly below the level of previous years and the long-term average. Everyone may have their own theories about the market in the coming weeks and months, but it is becoming clearer every day that these opinions are becoming more and more divergent in the case of the slaughterhouses and the tanneries. Many slaughterhouses, especially those that market their own hides, are betting on a recovery in demand and have no problem growing their stocks if the prices they envisage are not paid. This is not only true for fresh and salted products, but stocks in semi-finished products also seem to continue to rise. As long as there is a willingness to hold these stocks and it is possible to do so, they will of course not have a significant impact on market activity. However, should it become apparent in the next few months that the demand for leather and thus the production is not able to successfully channel these

quantities into the production chain, then there would probably be a very interesting autumn. Without wanting to be an extreme pessimist, one has to keep in mind that we have been seeing a similar situation with ovine raw materials for a long time now. The price spread in this sector is extreme, with almost no demand at the lower end of the quality spectrum and the goods no longer available to the leather industry. This, of course, also brings the market back into balance, because the overall supply is tightened in this way. This means, of course, that there is no real sales risk for the European raw material, but the balance between supply and demand must first be restored. Business-wise, I really have very little to report this week either. It remains the case that without a clear reaction in prices at the slaughterhouses, most of our production is not really competitive on the world market at the moment. High quality and special hide types will always find their market and are therefore not so extremely sensitive in terms of price. One would also find a market for the goods to which this does not apply, but for this the goods would have to be so attractively priced that they could really assert themselves against other alternatives. We did not see any really attractive bids from Asia this week either and in Europe business was limited to the always and at any time possible individual deals for special needs or long-term customers. There were no major changes in prices, although this is also due to the low level of activity.

The kill

There were no significant changes in the kill this week either. The peak of the holiday season is leaving its mark, both in demand and in available labour. We assume that it will continue like this for another two weeks before meat production will slowly recover again.