What happened this week: The week started fast and ended slow. Interest was mainly for lighter weight material and for the first time and long awaited also side leather tanners in Europe woke up and either covered incoming colour instructions or finally accepted, that their hope for a weakening market is in vain and it might be better to secure supplies. For them and the others who generally depend or concentrate on heavy males, market conditions become more complicated as most of the available material was and is absorbed by the automotive tanners who continiously secured their supplies all the way through the recent market rally and expanded their market share in this segment over the last weeks. Since most backlogs and security stocks have in the meantime been absorbed some buying interest could not be satisfyed. With the season change in shoes more interest for light material was seen and mainly lighter weight calf, kips and ox/heifers dominated the interest. Interesting is the fact, that not  the Italians were the active players, but Indian and Chinese buyers were the active ones. It is really a bit worrying, that the Italians are hardly seen at all. The cow market was

relatively quiet in comparison to the other sectors. Some heavy cow buying from Italian upholstery tanners was all in this segment. Neither Korean nor Chinese tanners were seen for cows and also other potential markets for this product remained quiet, although European dairy cows look still attractively priced. This would explain, that many in the trade admit to carry stocks or to find L/C delays from the Far East. Many of the sold hides could eventually become unsold inventories. After all the other segments showing signs of improvement and knowing, that the high season of garment production is still ahead of us, there is still a fair chance, that finally also the demand for this market could improve to justify the present price levels. Prices in general advanced further after a sharp increase in abattoir prices for March. Having drawn a quite positive picture about the market we have at least to mention again our concerns about the financial situation in the tanning industry were poor last year results and rising raw material prices squeeze the cash-flow of many tanners and more and stories are told about payment delays in Europe without any bankruptcy yet. On the currency

the EURO advanced moderatly and it will be interesting to see if an outbreak out of the trading range of the last month can be achieved, what would burden export calculations eventually.The kill: So far no change and slaughter numbers are steady now already for the last 6 weeks. A nightmare for the calculations and also for the market balance are the excessively falling hide weights, what is as well unusual for the season as well terrible for the supply/demand balance. It seems, that there is little hope for any improvement with the Easter Season approaching cutting two prodcuction weeks by a day.  What do we expect? With no sign of any shortly improving supply, notice that kills also in other countries in Europe are low and steady demand for males we have to remain steady to firm for male hides. Females we consider to be steady until a clearer picture about the demand can be seen from the Orient. In general we expect trading activity now slowing down with many waiting for the Hongkong Fair and their results of the Asian trips. The GDS shoe Fair in Düsseldorf over the weekend will hopefully also offer more information about the fashion trends and shoe leather demand for the coming season. Calculations will now get difficult for all in the trade.