Market Report 07.02.2025

What happened this week

As sad as it may be, unfortunately we can’t really contribute anything substantial about or to the market this week either. The Chinese New Year celebrations are coming to an end these days and most companies are starting production at the beginning of next week and trying to fill their capacities. For this production, the necessary raw materials are already in the factory and demand and purchasing decisions made now will only cover production in 6-8 weeks at the earliest. Whatever would be needed in China today cannot be supplied directly from Germany at the moment because exports directly from Germany are not possible. On the one hand because the required certificates for export to China cannot be signed by the local authorities and on the other hand because there is now also an official ban on German hides for import to China. Now there are always ways, but why should anyone accept complicated, more expensive and possibly riskier options today when there are plenty of alternatives to get raw material elsewhere. Regardless of the ban on exports from Germany to China, there have still been enquiries about offers this week and that in itself is at least good news. Of course, you can’t really take them seriously, but at least it’s not as if our goods are being completely ignored at the moment. On the other hand, they were still very quick and easy to cancel outstanding contracts that cannot be delivered at the moment. However, this doesn’t give the impression that they are mourning the goods and their non-delivery. The bottom line is that nothing has really changed fundamentally in the market situation. Demand remains below average and we are hearing the same from other regions. In Europe, it seems as if people are paying less attention to the commodity markets and more to the rumour mill. Who is doing what, who might be closing their tanneries, where are the raw materials going, etc. etc. and everyone has their own hypotheses and forecasts. Somehow, however, the impression remains that people want to deal as little as possible with the hard facts and there were not really many interesting suggestions as to how the European leather industry intends to emerge from the current trough. With little business and little activity, there were also few price changes.