Prices for U.S. Steer hides advanced last week depending on selection by $1.00 to $2.00, as demand continued to outweigh supply. U.S. Cattle slaughter remained below a year ago levels. Steer hide suppliers, coming into last week were more than comfortable with their sold ahead positions, and offered very few hides. Tanners who were in need quickly bought up what was offered, and continued to bid the market up as the week progressed. By Thursday of last week almost all Steer hide suppliers had withdrawn from the market stating that they were oversold, and were not interested in adding to their sold ahead positions. Sales prices reported for Big Packer Heavy Native Steer hides were between USD 73.00 and USD 74.00 per piece, and Butt Branded Steer hides were reportedly sold at USD 72.00 per hide, all prices FOB plant basis. Heavy Texas Steer hides estimated to average 60/62 lbs., were reported to have sold at USD 65.00 per hide FOB plant. Colorado Branded Steer hides were traded as high as USD 62.00 per hide FOB plant, up USD 2.00 per piece. Possibly the most active U.S. hides selection last week, from a trading point of view, was the Holstein Cow hide. Demand from tanners in both Korea and China was strong, and prices on all origins of Holstein Cow hides moved up by USD 2.00 per piece during the week. As last week came to an end, there remained buyer interest for Holstein Cow hides that was unfulfilled. Interest in Plump Native Cow hides also picked up last week but prices did not appear to have advanced much if at all. We heard little regarding Plump Branded Cow hide trading, and what was done was at steady money.
The Export Sales Report released by the USDA on August 6, 2015, for sales made during the week ending Thursday July 30, 2015, showed that 1,158,500 cattle hides and wet blue equivalents were sold for export during that week. This very large number of reported sales was up almost 48 percent from the previous week’s reported sales number of 692,400 hides and wet blue equivalents. China was the biggest buyer taking 768,800 pieces or almost two thirds of total sales number.
The Federally Inspected Slaughter (FIS) for the week ending Saturday August 8, 2015 was estimated to be 535,000 cattle, up just 3,000 head from the previous week’s estimated FIS of 532,000 animals. The FIS for that same week last year was 573,427 head. Year to date the FIS is off by 6.9 percent or 1,259,000 head for the same period a year ago.
For this week we look for U.S. hide prices to advance again. Why? The number one reason appeared at the end of last week to be that tanners were still looking to fill their needs for U.S. Cattle hides. Number two, it appeared that almost all U.S. hide suppliers were more than well sold out front. Number three, by all reports low slaughter numbers will continue to be the case here in the U.S. From all reports, the problems for many Chinese tanners persist, but things are improving gradually. Split prices are off their bottom, and leather orders are starting to pick up both of which will improve cash flow. Certainly, they are not out of the woods yet. As we have mentioned before, the currently lower U.S. hide prices have brought other destination countries into the market, which is healthy for all concerned. So, as this week begins, look for fewer offerings particularly on Steer hides, and higher asking prices. We will have to wait for tanner’s reaction to these higher asking prices, but a good bet is that at least some tanners will follow.
Golf Quotes
“My best score ever was 103, but I’ve only been playing 15 years.” – Alex Karras
“In choosing a partner, always pick the optimist.” – Tony Lema
