Market Report 05.07.2024

Osterhorn, Friday, 05.07.2024

The US $ in EURO: 1,0815

What happened this week

The market situation has changed little over the course of this week. In Europe, we are now waiting for the next price negotiations at the abattoirs and the extent to which they will adjust to the realities of prices on the world markets. This is already taking place in other European countries and it remains to be seen whether the necessary corrections will also take place here over the summer and with unnecessary delays. There is still relatively little happening in terms of business. In Europe, we are now slowly approaching the negotiations, which will cover the remaining deliveries up to the company holidays on the one hand and, in some cases, the first deliveries after the tannery holidays on the other. These discussions will of course also include the question of whether and how to deal with the quantities that are actually produced for the regular buyers during their closures. Usually, some of these go to contract tanneries, but it remains to be seen to what extent customers are willing and able to divert the goods this year. Whoever you talk to, there is hardly anyone who describes the situation in Italy as good or even satisfactory. The standard and core customers are taking their goods, but everyone else is reporting almost dead silence in this tanning centre of Europe. At the same time, this means that a large proportion of these hides used there will have to find other markets, leaving only Asia, led by China and also India, with a certain volume. That was also the case this week. However, our position there is somewhat difficult because there are now other origins that are already selling at a lower price level. This makes negotiations very difficult, as there are considerable gaps between the prices that we should actually achieve and the prices that customers in China expect. Given the large difference, it is obvious that neither side can actually realise their ideas. This meant that the negotiations dragged on for the whole week in some cases and all the friendship of both sides had to be invested in order to achieve any kind of result. The weakening USD was no help either. In the end, nobody was really happy. In many cases, however, it was clear that no agreement could be reached and so the talks were simply postponed because both sides were ultimately convinced that the future would bring a rapprochement to their position. The big question still remains as to whether the additional slaughter volumes in Europe in the first six months of this year have found their way at all and to where, because they were certainly not processed into leather in Europe. The markets in the Middle and Far East were probably the main buyers who took pity on the European goods. Tonight we enter the decisive weeks of EURO 24 and so far we have already seen some great matches and a big party of fans. Even though many have already had to go home, the atmosphere has always been friendly and cheerful. Let’s keep it that way, fair games and good luck to all teams and a little bit more for us tonight….!

The kill

Slaughter remains at its usual seasonal level. The statistics on slaughterings in Europe available for the first few months confirmed our constant assumption that there has been no major decline in slaughterings, at least in our region. Interestingly, many sources reported the exact opposite, which is all the more astonishing when you consider the increases in the numbers in some countries. How one can then come to the conclusion that the quantities have been reduced probably remains a closely guarded secret. If you look at the livestock numbers, then you have to assume that a reduction in the kill in our region is now slowly taking shape. There will probably not be a major change in volumes until the end of the year, but the declines could be more noticeable for the first time in 2025.

What do we expect

The next few weeks will now show whether the leather industry will endeavour to secure the low prices and increase its purchasing activities. It is difficult to assume that this will be accompanied by rising prices. Ultimately, everything depends on expectations for the rest of the year and the leather prices that may be realised. Here, too, it does not look like there will be any increases at the moment. The mood – and it may be wrong – is still pessimistic at the moment and in anticipation of prices falling further. However, it is also true that many hide prices are slowly heading towards their critical levels, at which point the question arises as to whether it still makes economic sense to collect and process the material at all. However, even if this were the case, it would not lead to any immediate consequences in the coming weeks.


Price Table

Type Weight range Avg. green weight Salted weight Avg. weight salted Price per kg Trend
Ox | Heifers 15/24,5 kg 22,0/23,5 kg 13/22 kg 20/21 kg € 1,00 Weaker
25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 0,80 Weaker
Dairy cows 15/24,5 kg 22,5/23,5 kg 13/22 kg 20/21 kg € 0,55 Weak
25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 0,55 Weaker
30/+ kg 33,5/35,5 kg 27/+ kg 29/31 kg € 0,55 Toppy
Bulls 25/29,5 kg 27,5/28,5 kg 22/27 kg 25/26 kg € 0,90 Weak
30/39,5 kg 36,0/37,0 kg 24/34 kg 31/33 kg € 0,90 Toppy
40/+ kg 45,0/48,0 kg 34/+ kg 38/40 kg € 0,95 Toppy
Thirds 15/+ kg 25,0/27,5 kg 13/+ kg 24/26 kg € 0,40 Weak
Thirds bulls 30/+ kg 38,0/40,0 kg 24/+ kg 33/36 kg € 0,50 Toppy

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