RE070122a

Osterhorn, Friday, 19.08.2022
The US $ in EURO 1,0035

What happened this week

The focus these days is clearly on the weather. Too hot, too sunny, too dry, too little rain or too much rain. Depending on where you are and what you have to do, opinions about the weather vary widely. Since the majority of people are still on holiday or in a holiday mood, there is not much else to occupy their minds. The escape from unpleasant realities is supposed to work at least during the few weeks of rest. Accordingly, business activities this week have been more concerned with administrative, maintenance and organisational issues than with discussing the hide market. However, those who do not want to take a few days or weeks off from business now have to deal with the changing environment very quickly. Calculations have to be reconsidered; at least in Germany, energy costs will rise considerably for at least the coming year. In the case of electricity prices, it will hit everyone sooner or later; in the case of other energy sources, it depends to a large extent on which one is chosen. The problem for today’s business is that the world market and the processing for hides and skins are not based on costs, but on the price levels dictated by the global market. Along the value chain from slaughtering to the finished product, there are sometimes very energy-hungry processes built in, which make a reorganisation of pricing urgently necessary. The different prices for energy in the various countries will almost certainly be a very specific criterion for the business development and competitiveness of many productions. In the short term, there also remains the problem of water supply in many countries, and how quickly the problems of lack of rain