This was probably the last really active trading week in Europe. Next week, all market participants will probably be busy making the last preparations for the end of the year and then say goodbye to Christmas. So those who wanted to make the necessary preparations for the new start into the new year with regard to the supply of raw materials were active this week. For the most part, this is certainly to the benefit of the sellers, because a certain degree of certainty for prices and quantities for the start of the year is certainly also in their interest. The talks were by no means easy in Europe. The tanners expect further and significant price reductions and this is of course not very attractive news for the sellers. This made the discussion extremely difficult and not successful in every case. Especially on the Italian market, the discrepancies in the ideas between buyers and sellers were particularly pronounced. In many cases the talks could not be brought to a successful conclusion and were either broken off or postponed again until the next week. In Asia, the main focus is on the consequences of the sudden end of the zero covid policy. On the one hand, relief is palpable and tangible among many people, and on the other hand, the rapidly rising infection figures bring many

new problems. In many companies there is a shortage of staff, banks and logistics service providers are often also unable to fulfil their tasks at the moment and, most importantly, there is uncertainty about how strong and how long the infection wave will last. Buyers in Asia are behaving accordingly. Some are positive and see the low prices as a buying opportunity and others tend to be cautious and continue to stay away from the market. Those who are betting on a quick end and thus a recovery of the economy were again interested in much higher quality hides. We continue to see this as a desire to test this commodity at the current price level, rather than a real need. Some deals were then possible for this group, provided one was willing to make minor price concessions. The standard types, such as standard dairy cows, there was interest and bids, but in combination with the relatively weak US dollar they were not workable and acceptable for us. This again meant that business in Asia was rather sporadic and limited to random deals.

The kill

The kill is now down significantly after all, and slaughterhouses are reporting clearly below-average meat sales for the holidays. We do not see any recovery next week either and very low productions are already announced for the last week of 2022. Traditionally, the start of the year also tends to be characterised by low numbers, so we expect very low production levels for several weeks.

What do we expect

We do not expect any more major market activity next week. Only Asia could still provide surprises, when buyers may want to take the opportunity that their European colleagues have already withdrawn from the market. It will only be interesting to see whether the large differences between the prices that Italian tanners in particular are currently signalling to the market and the sellers‘ expectations can be bridged in any way. There are many other problems to solve in the leather industry at the moment besides leather demand, and this does not seem to be particularly conducive to prices or demand for the beginning of the new year what will then wrestle with the expected and declining kill and offers.