Hide prices continue to decline slowly

25 April 2004

Hide prices continued to decline slowly throughout February and into early March as business conditions remained difficult. As Chinese tanners returned to work after their new year celebrations, the much hoped for increase in demand failed to materialise and Italy remained doggedly quiet. Depending on who you spoke to, Arzignano was operating at 60-80% of its capacity and every hide dealer in Europe visited there recently in order to see for themselves how slack things are. The air of uncertainty is further complicated by the fluctuation in the US dollar and the difficulty in trying to anticipate what is going to happen in the currency markets. Slaughterhouses, who appear to be having a torrid time of it themselves, are complaining that hide dealers are blaming the currency market, whether up or down, and expect this to bring back the price of hides. The truth is that all hides are moving in the marketplace but only at a price which is in steady decline. Kills are on the low side in Europe and the USA and if the kills increased, then the market would definitely come under further pressure and greater falls in price would occur. European tanners continue to feel the heat from Chinese tanners. And now that China is beginning to develop car upholstery for domestic consumption, the jewel in the crown of European tanners will come under threat as Chinese tanners source European steer hides for their raw material. Prices for hides at the end of February were as follows: 36kg+ …….......................…. 72p 31-35.5kg .......................….. 81p 26-30.5kg …......................... 84p 22-25.5kg ….....................… 93p Cows also continued to be a weak market despite greatly reduced kills. Salted prices fell to £17-18 per hide prompting one of the larger meat groups to get their own cows contract tanned and to sell the wet-blue themselves directly to Italy. It would appear that the contract tanner has the best return from this type of deal. Lambskins continued at a steady rate throughout February and into early March. Scarcity of kill helped to maintain process to the slaughterhouse, although the final selling price did come under pressure. Irish fellmongers were sold at £3.50 ex-yard and English fellmongers went for £4 ex-yard.

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