Market Report 17.10.2025

What happened this week

Our hide market remained again reasonably calm this week. There is still no notable downward price pressure or upside potential. Both sides of the table see their situaiton as pretty solid so far and also overall, conditions appear stable — much like in many other markets worldwide. A key support factor continues to be split revenues, both for leather production and the protein pathway. In addition, during times of uncertainty, some capital seems to be moving back into commodities, which also helps stability without reflecting the supply/demand situation along the chain. There is no change in the underlying demand for leather, though. Even the much-discussed, seemingly better Q3 results from a major luxury group do not, upon closer inspection, signal a true turning point. As a result, caution still prevails across many tanneries—particularly in European automotive leather—while reports of potential chip shortages from a Dutch production weigh on planning and add uncertainty. In other segments, the trend in the EU leather industry toward specialization and smaller order sizes continues; adapting to this market structure is challenging for larger plants, even if conditions are far from uniformly weak. However, that lower priced leathers will lose their production base in Europe is a pretty safe bet. Geopolitics will likely still play also a decisive role; an end to the war in Ukraine would f.e. be a significant positive catalyst as unlikely it seems today. Overall, fragile consumer sentiment continues to dampen spending—especially in Europe. Structurally, a clearer pattern is emerging: Asia aims to buy at very low prices, focusing on split revenues and competitive mass leather, while Europe increasingly needs to move up further to higher-priced hides and higher-value leathers to offset elevated production costs through added value. This, however, comes with challenges around capacity usage, lot sizes and lead times. The Asian interest seen last year in higher-grade, more expensive hides has cooled noticeably for now. On the operational side, this week’s sales were satisfactory in aggregate. Negotiations with Asia remain exceptionally tough, with buyers sometimes haggling for days over $0.25 per hide. Eventually, deals do get signed, so volumes for shipments scheduled to arrive before Chinese New Year are relatively satisfactory. That said, a truly solid base and lasting confidence have yet to emerge amid global uncertainty. Prices barely moved, and USD fluctuations arguably played the larger role in price discovery.