As expected there were fewer U.S. Steer hides offered last week, and of course this resulted in fewer Steer hide sales being consummated. The trading price for Steer hides last week advanced by $1.00 to $2.00 per piece from their previous levels. Cattle slaughter here in the U.S. remained basically unchanged, another week that came in below 550,000 head. All U.S. Steer hide suppliers continued to say that they were well sold ahead, and felt no pressure to sell hides. Another positive for suppliers was that L/Cs continued to be opened in good numbers. Shipments of hides and wet blue seemed to be running smoothly, which was easing any pressure producers might have felt to move additional product. As mentioned above Steer hide sale prices advanced a bit last week, so we would now put the Big Packer Heavy Native Steer hide values depending on origin, at between $ 75.00 to $ 77.00 per hide, and the Big Packer Butt Branded Steer hide sale prices at between $ 74.00 to 75.00 per piece, both price ranges FOB plant basis. The Heavy Texas Steer hide and Colorado Branded Steer hide selections saw their values move higher by $2.00 at the end of last week. Cow hide trading last week was more of a mixed bag. Holstein/Dairy Cow hides continued to be in good demand and sale prices, like Steer hide prices, move up by $ 1.00 to $ 2.00 per piece. To the relief of Plump Cow producers there did seem to be a little more buyer interest for Heavy Native and Branded Cow hides. On that interest the value of the Plump Cow selections moved up about $ 1.00 per piece, but not more. Low grades, Small Packers, Number Threes, Renderer hides, etc. all seem to be struggling to find buyers.
The Export Sales Report released by the USDA on August 20, 2015 showed that 671,800 cattle hides and wet blue equivalents were sold for export during the week ending Thursday August 13, 2015. This number was up almost 64 percent from the previous week’s reported sales of 410,200 units. China with 342,600 pieces purchased, 51 percent of the sales, and was the big buyer. Korea took the second largest share of the total sales with 186,800 hides and wet blue equivalents purchased.
The Federally Inspected Slaughter (FIS) for the week ending Saturday August 22, 2015 was estimated to be 540,000 cattle, steady with the previous week’s estimated FIS of 540,000 animals. The FIS for that same week last year was 596,002 cattle. Year to date FIS is down 7 percent or 1,355,000 head lower than a year ago.
Most if not all U.S. hide and wet blue suppliers, will have representatives traveling in Asia and calling on tanners prior to the “All China Leather Exposition”, held in Shanghai August 31st through September 2nd. In order to avoid confusion, we expect there will be very few hides offered through formal offer lists this week. With all the economic negatives floating around these days, plummeting stock prices, sinking prices on many commodities such as oil, slowing growth in China and Greece, plus continuing problems for tanners in parts of China with environmental and cash flow issues, one may ask how can hide prices go higher? A big part of the reason that hide prices have and may well move higher is that they dropped far lower in June and early July than they should have. This decline in hide values was in part due to problems caused by the labor dispute at the U.S. west coast ports and the resulting port congestion which have now been solved. Markets always seem to swing further, either up or down, more than they should. Now hide prices are more closely in tune to where they should be. This week we look for a few sales to be reported at steady to slightly higher prices.
Mulligan’s Laws
- Knowing the swing weight of your club is as indispensable to playing good golf as knowing the temperature of the grass in the fairway.
- A two-foot putt counts the same as a two-foot drive.
