What happened this week: It is not so easy to draw a bottom line under this weeks market. Certainly one can say, that there is still a too fold market. Premium male hides and the rest of the pack. Despite a general less excited market situation against the peak weeks in May and beginning June there was at the end still much more interest and business than – at least we – expected. Most of the interest was again focussed on males or heifers. From the auto industry one get mixed impressions – while some brands seem to budget their future with some more optimism are others still pretty depressed and this is also reflected n their sub-suppliers in the supply chain. As far as the hides which are used in this sector the mood has changed at least from totally depressed to moderately depressed and some of the replenishment programs continue. With the seasonally declining kill and some interest from shoe tanners in Asia price for males were lifted a fraction, but still not compensating for the jump seen already at the abattoir doors before. While the male market has certainly found a balance for the moment and sees good support from the lower summer kill – at least until most productions are going to

shut down in late July/August for their summer vacations. The holidays are playing also a certain role  in the market assessment, because one has the impression, that in a number of productions inventory replenishment is the real motivation for the increased demand. Different was the situation in the female market. We see the buying frenzy from China already slowing down for weeks. Slowly, but surely is demand falling with the increasing asking prices and this weeks bids were well below asking levels and the range trading of the USD doesn’t help much either. Asian tanners are hardly willing to pay May levels and claim, that they have already cheaper and more attractive offers from the US . One can believe that or not, but there is no question, that buyers are not desperate anymore for hides at the moment and only willing to buy if prices are ‘attractive’. With all the concerns about consumer demand in the upholstery and garment sector for the rest of the year one can understand that buyers take a break, digest first all the hides they got or are on the boats already and wait first to see how leather orders are going to come in. One can also hear frequently from China , that they expect now prices to ease into the summer and that they can easily wait

for some weeks or months for more attractive levels to buy – if they need to. So far most are still comfortable – sellers have moved their stocks and feel easy and buyers got the stocks and feel easy as well. Without equivalent finished leather orders arriving soon the situation could become interesting over the summer. As far as prices were concerned they were pretty much reflecting the market. Males were able to gain a few cents, while the prices for the limited trade in cows can hardly be called stable. Looking at volumes and bids a bit weaker might describe the situation probably a bit more accurate. The kill:  The continues to decline and the forecast of butchers for the coming weeks is a more pronounced decline in the kill. Weights remain low and should now shortly reach their lowest level of the season.  What do we expect: There are still about 3-4 weeks to go until most of the industry shuts down. It seems, that males remain well supported and any extra quantities will be snapped up by interested buyers. If the interest is strong enough to justify any further price rises – well we think this would be too much. The situation for cows is different and we would not be surprises to see pressure mounting linked also to the USD variation