The Hide Market – October 16, 2017
Last week showed signs that demand for U.S. raw and wet blue hides may be on the upswing. There were more tanners bidding last week, and suppliers recorded a decent amount of sales. Sales price for U.S. Steer hides were basically steady with those of booked over the last few weeks. However, there were a few sales of both Steer and Heifer hides reported at prices up $1.00 per piece from their most recent levels. Those reports made U.S. Steer hide suppliers feel that the market for their productions has finally bottomed out. With current U.S. hide prices at levels not seen in a long time, we are finding that tanners from around the world, including those who have been out of the U.S. market for some time, are looking at the U.S. as a viable raw material source. The tanners in Asia are still saying that their finished leather sales are disappointing. Chinese tanners, in certain areas, are still dealing with their government’s mandate that they clean up their discharges into the environment. Having said that, the number of bids in the market for U.S. raw hides we saw from both Chinese and Korean tanners grew considerably last week. The USDA’s Export Sales Report for raw and wet blue cattle hides released last week was down from the prior week’s release, but still a respectable number. U.S. Beef processors continued to operate close to capacity, which has now become their expected pace of slaughter. Because we ended last week on a little more positive note for the U.S. hide market, we are going put the FOB plant values for the various U.S. Big Packer Steer hide selections at the high end of the ranges we had been quoting for each selection for the last three weeks. So, we are calling the Heavy Native Steer hide price $61.00 per piece, the Butt Branded Steer hide value at $56.00 per piece, and the price of the Big Packer Heavy Texas Steer hide selection $49.00 per hide.
The Export Sales Report released by the USDA on October 13, 2017 for the seven-day period ending Thursday, October 5th showed that 652,400 whole cattle hide and wet blue equivalents were reported to have sold for export during that period. China was the leading buyer taking 299,600 of the pieces sold. Italy was the second biggest buyer purchasing net 52,400 units all of which were unsplit wet blue hides.
Federally Inspected Slaughter, (FIS) of cattle for the week ending Saturday October 14, 2017, was estimated to be 622,000 head, down from the estimated 632,000 head harvested the week before last. Year to Date FIS is up 1,358,000 head or 5.8 percent from the same period of last year.
For this week, we expect to again see a respectable number of bids in the market. Because of the prices bid by some tanners last week, there appears to be a rather large number of unfulfilled orders in the market at the close of last week. Tanners have been stubborn when it comes to what they want to pay for raw material, but it appears to us that some of that stubbornness disappeared last week and could soften further this week. U.S. hide suppliers seem to be rather comfortable with their sold ahead positions now, and again, hide prices are at levels that we believe allow tanners to run quite profitably. We will see, as the week develops, if that is indeed the case.
The best way to tell whether any golf gadget will help your game is to try to picture Freddie Couples using one.
Spike marks in the path of an off-line putt will never deflect the ball into the hole.