If it were Friday the 13th again, and if you were superstitious, you would have to fear that you might have to be careful on this day and avoid bad luck as much as possible. This is a little bit of a feeling that one can have in a sale of hides and skins for a somewhat longer period of time. Certainly, opinions differ widely in this case and there may be some who think this position is exaggerated. However, overall we have not found the situation particularly uplifting for quite some time and for our taste many fundamental problems are either being ignored or deliberately pushed aside at the moment. This week was further proof that there are two ways to deal with the situation. Either you enjoy the sales you have and the customers who continue to accompany you on a regular basis or you deal more with what is currently not saleable along the supply chains in the leather industry and will sooner or later, more or less, burden the entire chain and industry, or will certainly do so in the foreseeable future. Demand is concentrated on fewer and fewer regular customers, specific leathers and, moreover, the possibilities of selling are becoming more and more limited. There is simply a lack of demand from the leather industry and this should not be obscured by the ever possible individual deals and sales. These are always sporadic and accidental deals, essentially either from technical experiments or

smaller, speculative purchases that are not based on real demand. If this is enough for you, you may be satisfied, but for us this cannot be the basis of development in the leather industry for the near future. Rumours of large stocks keep flickering and these are now heard from almost all regions of the world. The continuously weakening US dollar is also a further burden on the revenues of hides from Europe. The US dollar has now lost almost 15% from its highs in 2022 without a corresponding correction in prices in Europe actually taking place. What is still possible in Europe is now no longer possible internationally with any business on the overseas markets, it will hardly be possible to sell  all the resulting raw material from Europe. Especially not over the summer months and with the holidays now fast approaching. Every week  and  this week, too, business was not zero. Individual sales were possible in Europe, while the prices offered from Asia, especially for cows, are not really presentable at the moment. However, the tanners – at least in China – have no need at all to adjust their asking prices at the moment. Even less so when there are other markets in Europe that have already made the price adjustments.

The kill

The kill was still significantly reduced this week due to the public holiday. Live cattle prices continue to fall at the moment, but it is simply not the time to assume that this could actually boost demand for beef. Temperatures are still relatively low and cattle are not yet going back to pasture. Once the grass really starts growing again and the ground dries out, there may be more interest from farmers to put cattle out, but we are now entering the phase of lower production and lower weights.

What do we expect

We believe that we are approaching a crucial crossover into our market here faster with each passing week. Except for selected hides, our hides are becoming less and less competitive. And this in a market that actually does not need all the production at the moment for the leather orders. What has to be bought is what is needed to cover the current orders, even if this is only a part of the total lot quantity. As long as there is no major need to adjust prices, the price trend will continue to be very tough. Finding a reasonable balance of prices between the skins for which there is still a market and those that don’t really have a market is becoming more difficult from week to week.