High prices take their toll

25 April 2002

The expected increase in kills did not materialise during February. Consequently, lower numbers kept prices firm throughout the month, although at the end of February, there was some easing of prices as resistance to the higher prices finally began to bite. Tanners were complaining en masse that wet-blue hides could not be sold at competitive prices while raw stock was priced at the high levels. A major part of the problem of high prices stems from the fact that meat processing in Ireland and the UK has been so unprofitable for quite some time now. Some beef processors were saying that meat plants were losing up to £50 per animal slaughtered. When such a situation exists, the plants try everything to extract a higher price for their raw hides. It has not been unknown for the odd untruth to be told by a sale's manager in a meat plant to a hide trader. The usual format is that a new buyer has entered the market with a higher price, or that a neighbouring plant has been paid, or offered £2 more than the current offer on the table. Of course, the usual buyer has their overheads etc and cannot afford to lose the production. Furthermore, if the market moves forward and the hide seller needs to fill in contracts, then he cannot take the chance of having to pay even higher prices next week. This situation continues until the bluff is called. It all leads to a very stressful set of circumstances for the hide dealers who, it must be said, have been accused of being economical with the truth themselves on occassion. Sometimes, hide and skin dealers in Ireland and the UK look with envy at their colleagues in other European countries who only have to endure this type of buying on a monthly basis rather than weekly. Prices of 36kg rose to a high of 91p in the third week of February, but by early March had fallen to 87p. 31/35.5 stayed steady at £1.00/99p. * 26/30.5 - £1.14/1.12 * 22/22.5 - £1.23/1.21 Cull cows continued to be the bonanza for wet-blue processors with prices paid in the £24/26 range depending on weight. Skin prices also came slightly down, back 10p at the plants during the end of February. Although kills were low, there was no great demand for them and buyers reported plenty of offers, even with a low kill. The elite skin yards in Ireland were still producing limited quantities of doubleface but, in general, skins were being sold on the run. The price for run skins ex yard at the end of February was £4.10.

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