Things got off to a slow start in the Hide Market last week. Offer lists put out by U.S. Steer hide suppliers early in the week contained, in most cases, less quantities or fewer selections, depending on the supplier. Asking prices on those offer lists were either unchanged from the prior week or in some cases down $1.00 per hide. We did not hear of any U.S. Steer hide suppliers asking ‘up’ money. There were some Cow hide suppliers asking for higher prices on certain Cow selections, an indication that they were able to obtain orders during the previous week at or near their asking prices. Suppliers said they have recently lowered their asking prices on some selections in order to bring them more in line with actual trading levels. However, the reduced asking prices seen on some lists gave many tanners the feeling that the market was weaker and that hide prices would move lower. Tanners everywhere continued to express their concerns that shoe leather orders were not what they had hoped for. Orders were being placed, tanners explained, but those orders were for smaller quantities than they expected. It seems that leather buyers, unsure of the demand for their finished product, are being cautious and establishing a pattern of placing orders more frequently but for smaller quantities. There was also concern from the auto upholstery leather tanners that demand for their leathers was on the decline. Some of those tanners expressed fears of a 20 percent decline in the demand for their product. By week’s end, it seemed apparent that last week’s sales of U.S. raw and wet blue hides did not match the week’s production. The trading that was done was done on Thursday and Friday of last week was at prices that were negotiated to steady with or down $1.00 from the last traded level of the item. The USDA’s Export sales number for raw and wet blue hides released last Thursday for the prior week was a better number than had been seen for many weeks. When we add what we consider to be the weekly U.S. domestic soak to that export sales number, the total sales exceeded U.S. cattle slaughter for the corresponding week.
We are putting last week’s FOB plant prices for seasonal average weight Big Packer Steer hide selections:
- Heavy Native Steer hides at between $44.00 to $45.00 per piece, unchanged for the week.
- Butt Branded Steer hides at $40,00 per piece, down $.50 for the week.
- Heavy Texas Steer hides at between $29.00 and $30.00 per piece, down $1.00 for the week.
The Export Sales Report released by the USDA on Thursday, March 28th. for the 7-day period ending Thursday, March 21st. show that 602,200 raw and wet blue hides were sold for export during that week. This number is up from the 502,800 pieces reported to have been sold for export the prior week.
The USDA estimated the U.S. Federally Inspected Slaughter, (FIS) for the week ending Saturday, March 30, 2019, to be 614,000 cattle. The year to date FIS is an estimated to be 7,799,000 up .6 percent from last year.
Tanners and their raw material suppliers are hoping for an upturn in leather orders, and those orders need to come from the shoe sector. The upholstery and handbag guys have pretty much held their own. The auto upholstery guys are anticipating a pullback in demand, but they still have decent business. Will something or somebody please wake up the shoe industry, we need them. Hoping that there is a light at the end of the tunnel, and it is not a train.
GOLFER – CADDY CONVERSATIONS
Golfer: “Do you think I can get there with a 5 iron?”