What happened this week: The week ended on a more positive tone, after the previous weeks were undecided and determined by uncertainty. The USD gained most of the losses from the previous weeks back, which added to almost 2 % for the week. Until Wednesday business continued its slow pace, but on Thursday and Friday interest perked up and a satisfying number of hides were finally sold. Bids were numerous to select from and so was the spread of prices. To be honest were most of the inquiries far below asking levels and even the firmer USD didn’t make them attractive enough. However, some prices were on acceptable levels, but below asking prices, but the currency factor assisted and so enough sales for the week were generated. It has to be mentioned, that almost all sales were generated with non regular buyers. The consistent customer base finds present price levels far too high and is not willing to follow the market until today. So, interest and sales focussed on more non-regular buyers which where looking to fill production gaps or were looking for alternatives for other even more expensive origins.

Despite the results achieved this week, one has to be aware, that for the moment these are just flurries without any consistency. In addition to the business in the regular cattle hides also bargain hunting continued and in view of the high level of prices of the regular material a lot of bargain hunting took place. Light hides and light weight materials which did not find any reasonable interest for a long time all of a sudden attracted speculators and buyers who put price in front of goods and enabled us to sell and hopefully also eventually to shift undesired stocks. Apart from the price factor it is also confirming the trend of the fashion which we believed to realize during the Bologna Fair this spring. Anyway, everything is at present driven by the Orient as European activity has almost come to the holiday standstill. Productions which are still running are basically just preparing for the shut down, maintenance or preparation of the after holiday supplies. Order books of the Asian tanners must be reasonable or they have just waited for the summer break in the Western world in the hope

to get hold of some cheap bargains. If, what they buy is cheap or a bargain can only judged by the buyer when he turned the raw material into leather. However, we still believe, that there are no miracles around and you don’t resolve problems in the calculation with cheaper raw materials. The kill: Still on holiday levels. Astonishing is the proportion between cows and bulls. The cow kill is exceptionally low, while the bull kill is pretty steady. So, the relation between males and females is at present pretty much in favour of the males. These will be the hides some tanners are going to miss when they reopen their beamhouses after holidays and look for fresh material.   What do we expect? The pressure we felt in the last weeks, in particular for cows, has definitely faded, mainly due to the increased value of the USD. Apart from that we don’t think much has changed. The summer months do not deliver any reliable basis for a market judgement, although definitely also European sellers feel now much more comfortable. The real trend will only be seen well into September, when more news about leather orders and prices for the next season will be available.