Market Report 15.11.2024

What happened this week

And every day the groundhog greets! You can literally feel more and more every day that the end of the year is slowly approaching us and at the same time that deep interruptions of shipment to Asia due to the New Year are taking up more and more space. This means that basically less and less attention is paid to the raw material market and the purchase and sale of hides and skins, but that one is more and more concerned with logistics, planning, payment and with the question of how to assess the development of the next few months. On the one hand, here and there you will find that one or the other order for the delivery of leather comes in and these are then to be fulfilled at relatively short notice. However, these are not any larger quantities and standard products that would enable ongoing smooth production, but rather the gap fillers and specialties that are to be delivered quickly before the end of the year. The end of the year is already being felt very clearly in the automotive sector, and more and more of our customers are reporting sudden drops in customer call-offs. Considering that many companies are already planning inventories for the end of the fiscal year, this is not a big surprise. It is no longer a secret that the automotive industry in Europe is currently going through a very difficult time and the negative news is now coming almost in a daily rhythm. At the same time, however, this also means that one does not have to and does not want to keep larger stocks of material, because according to everything we know today, production will not recover quickly even at the beginning of 2025. Additional planning uncertainty in this sector, which is still so heavily dependent on exports, is provided by the question of how American trade and customs policy will continue. There are also no impulses from the other European regions known for their leather production. The news remains rather negative, one has the feeling that many conversations about the future tend to want to evade. This leaves only Asia at the moment and basically the firmer US dollar should help exports and business. However, it was also quite quiet there. As every week, selective requests come in and most of the time these are interest in heavier hides. Despite the firmer dollar, however, most talks fail in the end because of the price. Some colleagues report a demand for the standard cowhides, but we have to admit that we are not favored by this at the moment. This means that sales remained rather below average this week and limited to individual deals for special and selected goods. Prices changed very little, in the end it was always a lonely decision whether to agree on a compromise or not.