Market Report 21.11.2025

What happened this week

We must continue to bid farewell to old habits and certainties. Normally, this time of year is marked by the highest slaughter volumes on the one hand and the highest production levels in the leather industry on the other. If nothing else, companies try to finish and ship as much as possible before the Christmas break. This phase usually ends in the last week before Christmas, and depending on order volumes and internal planning, businesses went on holiday for one or sometimes even two weeks. This year looks somewhat different. Slaughter numbers are significantly lower than what one should expect for the second half of November, and production in the tanneries is dragging along rather than showing any indication of a seasonal peak. The reasons for this are well known, at least within the leather industry. In no sector in Europe can we speak of anything resembling normal leather demand for this time of year. Therefore, companies try to adapt as best as they can to the circumstances — which is not easy, given the minimum critical volume required in any production facility. For some companies, this is sufficient; for others, likely not. The problem that results from this is familiar to anyone who must run a business. However, its effects often become visible only after a long delay. This means that Europe currently finds itself somewhere in the industrial “no man’s land.” A meaningful discussion along the supply chain is not taking place either, as the meat industry is also struggling with similar challenges — albeit in a different way. Commercially, most decisions for this year have been made, and only a few tanneries still need to cover demand until mid-January 2026. In Asia, the Chinese New Year is already casting its shadow, as Europe will be sending out its last shipments before the holiday in the coming weeks. The next possible shipments will likely not take place until late December at the earliest, and realistically it will probably be January. This leads us to the next issue awaiting final resolution: the European deforestation regulation. It has been repeatedly revised, and a final decision will be made next week in the European Parliament. Whatever efforts were made in Brussels to save the project — it can certainly be described as a resounding failure. It borders on absurdity which arguments are still being put forward in an attempt to find a political solution. Anything other than a one-year postponement and a full, realistic revision of the regulation would not only be a waste of time but further proof that Brussels operates in a bubble far removed from reality. Considering how long the EUDR has been developed, and the fact that it has technically already had legal force for over two years, the outcome of this work is simply devastating. And then there is the trading activity that everyone looks at each week. Yet this week, there was little to observe. In Europe, the last outstanding contracts for deliveries for the rest of 2025 were being finalised, and in Asia, there seemed to be little interest in additional purchases. It appears they have several weeks before new demand emerges for arrival toward the end of February. As a result, prices remained largely unchanged, supported by almost stable purchase prices at the slaughterhouses. Whether this will indeed ultimately help the situation remains questionable.