What happened this week: Another week were it was pretty difficult to get a clear picture. We think, that the situation between the good and the bad , the successful and the not successful, courage and no courage etc. is drifting further apart. What can be clearly seen is the big difference between the situation in the medium and higher shoe upper field and the volume production of furniture leather. Heavy substance side leathers as well as high quality bad leather still enjoy strong demand with the European specialist tanners and prompt deliveries are requested – in particular for wetblue material. However, not very many hides qualify and since it is a small part of the whole market the total volume is not really an influence on the whole. Furniture leather is quite the opposite. Price pressure and cheap finished leathers from overseas supplies such as Brazil and China are in the focus of discussion and also the – in the meantime small fair in Coburg (Germany) - confirmed the trend that price is just the only thing of interest at the moment. So there are hardly any

sofas made from leathers of reasonable quality on offer, what makes the sales of medium quality hides at todays price levels even harder. Price levels of € 1,10 per sqft for finished leathers are mentioned frequently. The trend for a weaker USD continued and makes calculations for hides from the EURO area even more difficult. Some isolated interest from Asia for cows was seen again in the second half of the week, but prices were mostly unacceptable and abt. USD 2-3,00 below todays asking levels. However, if these prices become reality we would have lost more than 10 % in price and another 3 % in currency when sales to Asia are calculated. In Europe the drop was not as sharp, but a) who knows what is to come and b) the price were lower already anyway. Sales were not particularly strong during the week. In Asia most of the buyers were still in holiday mood and many others on overseas trips. Furniture tanners are were, or are waiting for the results of the fairs. In Europe business in heavy males was just acceptable and for females just isolated.

Low grade were sought. Under these market conditions the abattoir buying prices can be at best called cynical. Although prices came down by some €s, it is far away from the correction required to bring the market back on adequate levels and it seems, that many continue to ignore the global price trend and the currency markets. Anyway, eventually the consequences will have to be managed – as before in history. The kill: Levels are good now, but not yet on the seasonal highs. With colder nights ahead of us, we expect the kill to increase further in the weeks to come and weights should also start to increase. The pressure on abattoir margins is also high, what makes it not easier to deal with butchers at the moment.  What do we expect? The next week we should see a bit more interest form Asia again. However, it will be hard to defend the present asking levels for cows in the present market environment. Bulls seem to do a bit better and we believe, that sales will be satisfying at prices which will reflect the marginal declines in the buying prices. This could be called a weak-steady all over.