It is quite likely that opinions will diverge somewhat over the week. It is the old story if the glass is half full or half empty. Chinese clients are slowly returning from their holidays and have to deal with the realities of the markets and their decisions for the coming months. The number of inquiries and bids increased noticeably this week. However, clients in China are still moving in the world they left when they went on their New Year holidays. This means that bids were noticeably below asking prices and there was always the possibility of finding a seller here and there who was prepared to respond or at least to negotiate seriously. This situation has changed in the meantime and since prices have stabilized on other markets, the willingness to accept significantly lower bids has also decreased considerably in Europe. In Europe it is clear that everyone is now waiting for the fair in Milan to get a clear picture of the further development of the market and in the leather industry in the coming weeks and months. Everything will depend on whether the demand for leather will finally increase again and whether the geopolitical problems will have a new negative influence on the

markets. All in all, the feeling is spreading that after a long phase of rather falling prices, the time may have come to try the other direction again. There are no real and solid arguments for these attempts, but sometimes psychology is enough. Feelings have not yet reached facts and prices, and even this week prices did not really move at all. Customers were still not willing to pay the asking levels prices and in no way willing to even consider higher prices. Thus, the few deals that could be negotiated this week were concluded at almost unchanged levels. The hunger of the Chinese tanners does not yet seem to be so great that they seriously feel the need to secure goods in the fear that they might be more expensive later. Somehow the whole market situation has become completely entrenched and lacks the decisive impulse that could lead to a real turnaround. This simply requires a revival of leather demand or successful price negotiations by the tanners with their customers, which could lead to higher leather prices and thus to an improvement in the calculation. From our point of view, it will take a few more weeks of patience to get really reliable information on this.

The kill

There was a slight upturn in the kill and slightly higher numbers. However, this is rather due to daily shifts without giving the impression that anything fundamental has changed in meat demand and purchases in the supermarkets. We are now approaching the carnival season, which traditionally reduces meat demand and the kill for some time.

What do we expect

Boring as it may be, without any real clear news from the markets there continues to be little reason to think of any major change in prices in any direction. The low slaughter numbers support the sellers, the leather business encourages the tanners not to take big risks on the raw material markets, so at least for our markets there seems to be no real reasons other than speculative activities that could lead to a fundamental price change in the near future. However, it is also true that the longer it takes, the closer the moment of decision will come before the direction of prices in the second quarter.