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Osterhorn,
Friday, 22.05.2020
Market Report

The US $ in EURO
1,0900


What happened this week?: For Germany it was one of the short spring weeks with a holiday on Thursday and consequently only the necessary minimum of people working on Friday. For many companies a welcomed additional break. A bit of the opposite for tourist spots which were enjoying the easing restrictions, because many were looking for a destination for a short break. Monday was the day when the coastal regions were reopened under certain conditions and the holiday break on Thursday and school holidays in some parts of the country saw a lot of travellers on their way for a quick break. Although it will not be the full turning point at least hotels, restaurants and also shops in the resorts can welcome a few more customers. At a second glance it will also be now the very decisive phase to learn if the spread of the virus will return with more people moving ad restrictions lifted or if the discipline of people and following physical distance regulation can keep the infections also low even with a bit of a more normalized daily life. In roughly ten days or two weeks we will know. So far, the country enjoys still a low infection rate although the daily published numbers are only dropping in isolated regions already to the zero level. Without seeing people wearing masks everywhere one would tend to think that all is almost back to normal. The numbers and in particular private spending and  consumption speak a different language. who did not know or willing to understand gets now a quick lesson about a) the importance of psychology and b) that production does not command consumption forever. For many years growth and cheap money had created an environment of spending what resulted in the logic of a production budget followed by the simple marketing tools. What was not sold was just trickled down the price and distribution grid and there was even then still enough room for the sale of a cheaper copy. The consumer swallowed it all. Cars and electronics etc. were managed in a different pattern commanded by speed and model innovations which were mainly not really adding any value. However it worked. What FFF did not manage, Corvid-19 did. Consumption has slowed, the focus changed and everyone is now waiting and discussing if the routine will return or if the consumer has got a push towards the analysis if the continuous run for the 'always new' should be really on top of the priority list. The community is totally divided in their opinions. Some believe the shopper will quickly return to their habits while others are convinced that the lock-down, the presently limited shopping experience in combination with less social contacts with lead to more selected and reduced shopping activity combined with a change of priorities. For the leather industry at least a chance to focus on natural value-for-money products. This is however the possible future. For the moment the situation is bleak and the pipeline congested. European tanners resume very slowly and Asian tanners remain just price obsessed without a clear strategy. They just hope that cheap raw material will pay later and so their sole interest is to buy cheaper without a clue what will happen. Sales were minimal, because in Europe just the precious regular clients can be served and from Asia this week the common attempt to buy once again USD 3-4,00 below the last levels did not allow any sale at the end.  The Kill: The kill begins very slowly to recover. Several of the Corona-19 hit abattoirs are slowly beginning to resume production and the beef industry is now hoping for a recovery of the consumption of prime cuts. Even if restaurants can only serve about 50 % of thier clients a bit of business should be seen. What do we expect: Our concern that it might get worse before it gets better seems to materialize. The hopes that the easing of the restrictions would quickly convert into more sales is so far disappointed. People are insecure about their future and prefer to keep their wallets closed until they know more. Tanners miss orders and need to wait until the sky clears up. This may still need a few weeks of patience.


Type Weight range Avg. green weight Salted weight Avg. weight salted Price per kg green weight Trend
Ox/heifers 15/24,5 kg 22,0/23,5 kg 13/22 kg 20/21 kg € 1,00

  25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 0,60

Dairy cows

15/24,5 kg

22,5/23,5 kg

13/22 kg

20/21 kg

€ 0.50


 

25/29,5 kg

27,5/28,5 kg

22/27 kg

25/26 kg

€ 0.45



30/+      kg

33,5/35,5 kg

27/+   kg

29/31 kg

€ 0.40


Bulls 25/29,5 kg 27,5/28,5 kg 22/ 27 kg 25/26 kg € 0,70
  30/39,5 kg 36,0/37,0 kg 24/34 kg 31/33 kg € 0,75
  40/+     kg 45,0/48,0 kg 34/+   kg 38/40 kg € 0,65
Thirds 15/+      kg 25,0/27,5 kg 13/+   kg 24/26 kg € 0.25
Thirds bulls 30/+      kg 38,0/40,0 kg 24/+   kg 33/36 kg € 0.25





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