Strong Euro and weak US dollar causes concern
15 October 2003
A chill autumn wind blew through the hide markets during the months of September and early October. Cattle kills were high but tanners reported extremely difficult trading positions with cow order books and a strong Euro combining with a weak US dollar to cause a serious correction in the hide markets throughout Europe. During the August shut down in Italy, there was a strong belief that the hide market was rising and would continue to rise during September. As a consequence of this people held on to hides. This, however, turned out to be a big mistake. In Ireland, it was rumoured that at least one abattoir who started salting for their own account had a large unsold stock position in early October. This was after having turned down good prices in late August and September. It appears that some painful lessons are now being learnt by the abattoirs who salt as we in the hide business have suffered over the years. However, in the long term in Ireland, this is the course that most processors are expected to follow. Prices at the end of September were as follows: 36kg+ ……….........….…. 83p 31/35.5kg …..............…. 90p 26/30.5kg …....…............ 95p 22/25.5kg …................. £1.00 Low prices were also weaker for the month of October. In general, they came off by £2 (£1 = US$1.66) per hide to £20.50 ($34.03) ex yard on the run. The big fear in the market place is that if the American dollar continues to weaken as is being indicated unofficially by the American treasury, then the hide market will remain weak for a long time to come, especially if the Euro stays strong. Manufacturing costs in Italy will impede any improvement in the market. Prices for doubleface lambskins eased at the end of September and Irish skins were sold at £8.40 delivered to Türkiye. English skins went for £7.80 ($12.95). Further falls are expected and due to the warm summer and early autumn, the Russian buyers had not yet come to Istanbul, and manufacturers warehouses are said to be full of finished garments.
