Market Report 08.11.2024

What happened this week

This week there were many other things of presumably great importance for the future and again few events from our business to report. Of course, the whole world was initially preoccupied with the presidential elections in the USA and it will probably take a few days for everyone to digest and analyse the results and draw conclusions for their future business decisions. In Germany, there was also the government crisis, which meant that developments on the hide market took a back seat this week. Whether this was due to politics and the events, or whether there was simply little activity, will probably become clear in the coming weeks. In the meantime, more and more players are starting to think about what the future holds for the European leather industry. Meanwhile, the official news about the really unsatisfactory order situation of most European tanners is increasing. In recent months, many sellers have been reassured that somehow the majority of production could still be sold. However, there are now increasing signs that not only might the interruptions over the Christmas period be longer, but that some leather factories are also considering further production cuts. The problems in the automotive industry can now be seen in the media every day and in Europe things are not looking much better in many other sectors at the moment. Of course, there is always the market in Asia and a large proportion of European hides can always find buyers through price. Quality still qualifies them above other alternatives. However, the problem remains that the price structure for many types has not been right for some time and the adjustment to the actual market situation has been postponed time and again. For many suppliers, a significant increase in the proportion of sales to Asia would also mean a considerable rise in costs. For many who are used to simply chilling their goods and handling them quickly, a larger proportion of salted goods for export to Asia would mean higher costs as well as considerable demands on staff and storage space. For us, the number of sales this week was also below average and the volume was again limited to random transactions. Shipments to Asia are also a major challenge, as the shipping companies are currently not very reliable business partners. Many bookings are not being honoured, which is not only a major administrative challenge, but also slows down stock turnover. This is unlikely to improve in the coming weeks, as the loading window will be closed for some time, otherwise the goods would arrive in Asia for the New Year celebrations. As it is obvious that customers in Asia are also relatively well stocked up at the moment, they have time before they have to worry about supplies again after the new holidays. There was very little change in prices, with the firmer US dollar providing a little support for the calculation.