What happened this week: We have definitely now arrived to the low season of the summer. Business and sales have not come to a complete standstill, but trading is getting more and more coincidental at the moment.  One or the other sale to China for dairy cows, but nothing in any significant volume.  The good thing remains, that the letter of credits are still coming in on time and hardly any delay can be recognised.  This confirms also the opinion of many other market members, that various traders might have sold short and find it now difficult to cover in and to ship according to the agreed shipping schedules. Consequently buyers are opening their leather of credits to the sources where they can assume, that they can meet their shipping times. Apart from the spotty sales into the Orient also some late comers in Europe were determined.  However, here the interest was less for dairy cows, but much more for ox/ heifers which were requested from various destinations.  It was pretty hard to arrive to asking levels, but in the end one of the various interested parties had to accept and so were some limited quantities booked.  The only other mentionable interest for hides came again from the buyers who

were already for many weeks looking for cheap and economical light weight material. Existing stocks are now starting to exhaust and it will be difficult to replenish at the same speed tanners are looking for this kind of material.  As a consequence prices went  higher and were eventually accepted within the frame of plus 10%.  It gets more and more obvious, that a lot of this material is finally ending up in the South of China where it is tanned and selected before it is entering into various finishing productions around the globe. It will be very interesting to see if this particular interest can also be moved into the next season.  The only other really interesting development this week was the increasing interest for sheep and lamb skins.  Clearly it is again just speculative activity from the usual buyers in particular from Turkey who run around with their cash trying to find sellers which are desperate for sales and movement of product and to grab every single bargain around.  It seems, that there are still a number of traders with stocks and insufficient storage capacities. Plenty of rumours are around reporting trades around Euro 2,00 per piece, no matter whether it is sheep or lamb. We doubt, that

there are still large volumes left and it is going to be interesting to see what is going to happen when the production season for garment leather is going to start by the mid of August.  It is pretty obvious, that not tanners are buying yet, but mainly wholesalers and traders are starting to build cheap inventories. We have seen this attitude already in the last years, when the speculation failed, but the main difference this year is, that there is neither a large inventories in the hand of the tanners nor is the price level as high as it used to be before.  The kill: Nothing really new to report from the kill and the beef consumption.  The next two to three weeks are peak holiday season with almost the whole of the country in vacation. Consequently anything else than a continuation of the present levels would come as a surprise.  What do we expect? We continue to fail to find any reason why this market should be triggered to move into either direction.  If there's anything, than it will be mainly sellers trying to achieve higher price levels.  The outlook for leather business does not seem to be bad, but history tells us, that the final trends will only be set after the main trade fairs which are taking place until mid October – subject external influences.