You can twist and turn it however you want, but the market development and market assessment is rocked back and forth like a small rowing boat on the big Atlantic. This is certainly also due to the fact that at the moment, due to the upcoming holiday season, the finished leather market is determined more by opinion and hope than by real business and activity. Certain regularities are also taking effect this year and despite the many parameters that are currently determining economic activity and thus also the leather industry. The lifting of the lockdowns in China is forcing the leather factories there to make decisions on how they want to organise their raw material supply for the second half of the year. With the extended times for transport, those who need a certain raw material for their production have no choice but to face the procurement question in some form. Those who buy today are unlikely to have their goods in the factory before end September and so time is running out for raw goods that cannot simply be substituted locally. Even those who want to use their beamhouses have to provide for raw material supply in some way. So, we have a situation like we have seen many times in history in July. Hardly any activity in Europe, but a clientele in Asia actively looking for the good opportunities on the market. Even if there is still a massive resistance to price increases, at the moment the very weak euro is at least helping to prevent greater further price pressure. However, demand is still limited to either very low-priced or very high-value types of goods. In our case, this means that normal female hides are attracting very price-sensitive interest, and at the same time high-value female hides are being bought at the actual lower market prices.

Male goods, which are still available in sufficient quantities in Europe, find little interest in Asia at the current asking prices. As a result of this constellation, the suppliers are trying everything in their power to reverse the price trend and have now significantly reduced their willingness to accept lower price offers. The continuing low kill and the strong dollar are supporting this. However, only the autumn will show whether this can be sustainable, as it requires a clear improvement in demand for leather. At the moment the market is price-sensitive in both directions, like many other raw material markets, and both sides hope that the trend will continue and consolidate in their direction. This week’s business and sales were again rather random. What the tanners want to buy at the moment is largely already planned and sold for the next few weeks and what the sellers would certainly like to place is not really in demand at the moment due to the price problems. This means that business is again very much limited to specialities and niches. To be honest, not really negative, because even these rather irregularly available materials still have to find their customers in the end. This was especially true this week for lighter goods in the 12-24 kilo range, where the impression is that this sector generates the most reliable demand in the market, both for leather goods and shoes. Prices remained very stable this week with the help of the EUR the  pressure is slowly decreasing without being able to speak of a real turnaround. There is still a long time before the summer ends.

The kill

To be honest, one can just save statements about the kill for the moment. Almost as if drawn on a ruler, numbers remain at about 70% of the normal average level and nothing is really changing at the moment. More and more federal states are now starting their summer holidays and until mid-August we don’t know what could fundamentally change this situation.