What happened this week: To discuss ‘the market’ at the moment is not really possible. In Europe we have a non existent market due to the holiday season. This and next week hardly anyone is at his desk. Phone calls and interest came only from export traders trying to cover further shorts or from tanners which called from their holidays. So, everything was still fully concentrating on the situation in the USA and Asia. Over there is, where the music plays at the moment and where prices move upwards. This has only in part yet reached Europe, because the grades interesting for the Asian markets are limited to dairy cows and some low grades and heifers. Dairy cows are fairly well sold and the desperate interest seen from export traders couldn’t be satisfied. Regular buyers from the Far East got their regular offers and if they are already mature to pass the increases in the US market also into Europe needs still to be seen. So far, no new business at higher prices was concluded yet, although one can expect that next week higher

prices will be achieved. The few and only sales this week were completely concentrated again on low grades and buyers in the Middle East. The rest of the market was very quiet for the simple reason, that neither abattoir prices for August are yet fixed nor the EU program buyers are due for sales. Since the European bulls have only limited markets in the Far East they could not benefit from the rising prices in the USA, nor from the better demand. However, if the price gap widens any further it is only a question of time when also overseas customers will have to take notice of the cheaper options available in Europe. Leather demand continues to look promising for the rest of the year. Retailers seem to see a silver lining for Germany and also shoe brands and auto makers are at drawing a positive picture for the remaining five months. Consumer spending in Asia and the Eastern bloc continues to be strong and all this is friendly for the leather and hide demand. If there wouldn’t be the problem of prices! Tanners run now the risk to book leather orders for the months ahead which might be not

adequately priced if the raw material market confirms the better demand in the weeks to come. One way or the other the world still suffers from overcapacities in the tanning industry what will have it effects in itself and the massive pressure seen in the second quarter of the year has faded and might even turn into something called optimism. The kill: The record temperatures in Europe and the holidays keep slaughter numbers down. For the coming two weeks we cant expect any change still. We have very conflicting opinions about the slaughter after August. If there will be further draught problems it could boost slaughter sooner. However, beef demand continues to be low and the question would be where can the beef be sold. Some more weeks will tell us the story. What do we expect?  The cow market will trend firmer due to inadequate supplies, while the bull market will have trouble to take off yet. However, the tone of the market has now changed to a clearly firmer trend – if it is only in sympathy for the developments overseas. The European business still requires to  confirm the better outlook with better demand at higher prices.