THE HIDE MARKET – February 18, 2019
Activity in the U.S. hide market started slowly last week, but by week’s end, there were a fair number of tanners in the market bidding on U.S. raw and wet blue hides. There were some sales reported at “up” money on a few of the more sought-after selections from preferred origins. The Heavy Native Steer hide was the Steer hide selection that saw the biggest jump in value, moving up by about $1.50 per piece. At the same time, a few Butt Branded Steer hide sellers were able to move the price for that selection up by as much as $1.00 per piece. However, we came away from the week with the feeling that none of the other U.S. Steer hide selections were traded at more-than-steady money. We can explain some of the jump in the Heavy Native Steer hide value as resulting from the fact that the production of this selection was reported to be down in number. Sale prices for U.S. Cow hides were also mostly steady, with a few sales of premium Dairy Cow hides being made at prices we would call up $1.00 per piece at the most. The buyer interest that was in the market last week came from many areas. Interest from China was not as prevalent as what we would call normal, but it appeared to us that other destination buyers were more active. This absence of China in the market could may well have been the result of the fact that many tanners there had not yet reopened their factories after the extensive Chinese New Year holidays. U.S. Cattle slaughter dropped down below the 600,000-number last week as beef demand weakened, as it normally will this time of year. Despite the reduced slaughter number, we doubt U.S. hide sellers sold an equal number of hides during the week.
Because of the few sales that were reported at up money we are moving our quotes for last week’s FOB plant prices for the seasonal avserage weight Big Packer Steer hide selections up a degree on some selections:
- Heavy Native Steer hides at $43.00 to $44.00 per piece, up $1.50 for the week.
- Butt Branded Steer hides at $40.00 per piece, up $1.00 for the week.
- Heavy Texas Steer hides at $30.00 per piece, unchanged for the week.
The USDA last Thursday released their Export Sales Numbers for U.S. raw and wet blue hides for the holiday shortened week ending January 3, 2018. Those released numbers for raw and wet blue hides totaled 166,400 pieces sold and was down from the 245,500 pieces reportedly sold for the prior holiday shortened week.
The USDA estimated the U.S. Federally Inspected Slaughter, (FIS) for the week ending Saturday, February 16, 2019, was estimated to be 596,000 head of cattle. Down from the 614,000 animals processed the prior week. The Year to date FIS is an estimated 4,134,000 head down .8 percent from a year ago.
We expect to see more Chinese tanners nosing around and bidding on U.S. hides this week. What they are willing to pay for the hides they wish to buy will very likely determine the direction of this week’s market. Last week’s bids from most Chinese tanners were not up to recent market levels and/or below what other destination tanners were willing to pay for the same product. But we can’t forget that China is the number one destination for U.S hides. And in the long run they do have a say as to what U.S. hide values will most likely be. Hope everyone has a good week.
Doug Meredith, Dallas Cowboy Quarterback once said: “Coach Tom Landry is such a perfectionist that if he was married to Raquel Welsh, he would expect her to cook.”
Reggie Jackson commenting on Tom Seaver: “Blend people come to the ballpark to just to listen to him pitch.”