THE HIDE MARKET – February 4, 2019
The United States hide market was stagnant at best last week as much of Asia began preparing for the Lunar New Year holiday. There was some business that carried over from the prior week that was concluded early, but as the week progressed the market fell silent. On the supplier side offer lists were not very large and shipment periods were mostly out into March and April, but that did not stop a few tanners from passing bids well below the market to see if any supplier might need to move a few hides last week. With the middle two weeks of January finding an active market, no supplier we talked too was interested in any price that was below their most recent booked business. The U.S. federally inspected slaughter fell below 600,000 last week for the first time in quite a while. Beef prices slid late in the week and reports show the industry not being very forward sold due to lower demand from retailers. If this trend continues then we could see fewer hides being offered from packers in February. The U.S. cow market did not fare any better than the steer market last week. Again, there were a few bids well below the market, but most cow suppliers still find themselves forward sold enough that they did not need to consider these low bids.
Following are our quotes for last week’s FOB plant prices for the seasonal average weight Big Packer Steer hide selections:
- Heavy Native Steer hides at $42.00 per piece, unchanged for the week.
- Butt Branded Steer hides at $39.00 per piece, unchanged for the week.
- Heavy Texas Steer hides at $30.00 per piece, unchanged for the week.
We finally received a weekly export sales figure last week, but it was for the period ending December 20, 2018. It seems that the next couple of weeks will be catch up weeks to close out the export sales report for the 2018 calendar year. Sales for the week ending December 20, 2018 showed a total of 452,900 hides and wet blue sold for export. China was by far the main destination for hides and wet blue with purchases totaling 289,600 pieces.
The USDA estimated the U.S. Federally Inspected Slaughter, (FIS) for the week ending Saturday, February 2, 2019, was 593,000 head of cattle. Down from the 610,000 animals processed the prior week. The Year to date FIS is an estimated 2,898,000 head which is down 2.7 percent from a year ago.
The Lunar New Year is in full swing as we begin this first week of February. All of China will be out this week with the rest of Asia taking the beginning of the week off to enjoy the holiday. We will see if there are any customers who will be picking up their mobile phones to put in some orders this week, but the way it looks that is not likely. It is still too early to tell what this week will bring and maybe there are a few tanners out there who are still short of hides and will need to do some business this week. Either way those of us selling hides will still be putting out offer lists as usual, so if there are those tanners out there that want to buy, they know where to find us. Happy Lunar New Year!
“I regard golf as an expensive way of playing marbles.” – G.K. Chesterton
“When your shot has to carry over a water hazard, you can either hit one more club or two more balls.” – Henry Beard