Market Report 20.03.2025

What happened this week

The assessment of the market and the general situation today certainly depends more on emotions than on facts. Everyone may have their own opinion, but we have the feeling that another almost lost week has come to an end. Of course, this is particularly due to the fact that we have been taken out of the big market in China due to the lockdown caused by the foot-and-mouth epidemic. However, if you look at the news that others are reporting about the current business in and after Hong Kong this week, it doesn’t seem as if you have missed much. If you summarise the news from the various origins, then at least for the female hides, sales volumes are relatively low and prices are falling. If you want to sell cows in particular today, you have to make concessions, otherwise buyers will turn away. No matter how hard the Chinese government tries, its attempts to support and stimulate domestic consumption have not yet been particularly successful. Cautious restraint is already noticeable in other markets. Seasonally alone, fewer raw materials will be needed in the coming months and this does not even require the relatively bad news that can be read every day. Last week, it was once again the European car manufacturers who did not publish any dramatic losses, but sharply reduced profits. If you read between the lines, you can see optimism of purpose, but hardly any real facts that suggest an improved trend. If you look at the results of the supplier industry and the news from there, then you can imagine that there is not too much good to expect from the suppliers of leather and seats either. As always, it’s not all bad and there are still supply chains that are largely operating normally. But a part is never the whole and that is why the negative impressions predominate. More and more hides are finding their way into the production of proteins. Even the historically low prices are not stimulating the demand for leather and at the same time it allows more hide substance to be used in other sectors. The next few months will show whether what is lost on one side can be used on the other in the long term. The market for heavy, male and also better quality raw materials remains relatively stable. Corresponding added value is still possible here and more and more tanners are also trying to produce better quality raw materials internationally, which are still in demand and generate sufficient revenue. However, the quality and price pyramid also applies here. Big and large at the bottom and narrow and high at the top. On the sales side, there was little to report this week. The special items that still require very special raw materials and expertise and at the same time have hardly seen any drop in demand are still a source of pleasure. Over the next few weeks, we will have to talk about our plans for the second quarter and it will be interesting to see how the increasingly divergent price levels of the different hide types will play out.