Last week’s Holidays here in the U.S. and in Asia made for a short trading week. Coming off a couple good weeks of sales, U.S. Steer hide suppliers put out offer lists that were smaller than they had been for several weeks. The asking prices on those lists were at steady to slightly higher than their prior week’s offerings. In the end, the lack of bids from tanners and the reluctance of suppliers to accept those lower bids kept the volume of Steer hide business that was put together to a limited level. Offering lists put forward by U.S. Cow hide suppliers were even more limited than offerings from the Steer hide sector. Not that the lack of Cow hide offerings in the market generated much interest from tanners, but rather, it seemed that both sellers and buyers of U.S. Cow hides seemed content to tread water for the week, putting together a limited amount of business at steady to $1.00 higher levels. Tanners continue to complain about their leather sales, saying that the volume of orders is just not there. While we understand this to be true for the shoe leather business, other leathers, like handbag and upholstery, seem to keep moving along at respectable levels. Last week’s U.S. Cattle slaughter number was low because of the one day holiday here. The Export Sales number reported on Friday of last week for U.S. Raw Hide and Wet Blue equivalents sold the week (7-day period) ending May 25th was expected by most in the trade to be a healthy number. But, it was even larger than most all estimated it would be. We are going to call last week’s FOB plant sale prices for U.S. Big Packer Steer hides basically steady with the prior week’s levels. So, we are keeping the Heavy Native Steer hide selection at $67.00 per piece, the Butt Branded Steer hide value at from $64.00 to $66.00 per hide. For the Big Packer Heavy Texas Steer hide selection, we are going to put its value at $62.00 per piece FOB plant basis, which is the number that is the average of both the high and low end of reported trades for this selection. We are going to call last week’s sale prices for U.S. Cow hides fully steady to slightly higher. Sales of U.S. Cow hides, as we mentioned above, were limited last week but we don’t believe any seller book any business at lower prices.
The Export Sales Report released by the USDA on June 5, 2017 stated net sales for export of a whopping 870,200 U.S. cattle hides and wet blue equivalents for the 7-day period ending Thursday May 25, 2017. This number is up from the already large 753,100 pieces reported to have sold for export during the prior week. The leading buyer was China with 345,900 units purchased. Korea booked 138,100 of the pieces reported sold during the 7 days ending May 25th, making it second largest buyer for that period.
The Federally Inspected Slaughter (FIS) for the holiday shortened week ending Saturday June 3, 2017 was an estimated 550,000 cattle. For the same period, last year, the FIS was 527,496 head. Year-to-Date FIS is up an estimated 698,000 head or 5.7 percent from a year ago.
After sticking to their guns last week and refusing to take low bid prices from tanners, we expect U.S. Steer hide suppliers to come out this week with more resolve. By the close of business last Friday, U.S. Raw Hide suppliers could fully hold the line on prices while still putting some business on the books. A couple of the U.S. Steer hide suppliers stated, late last week, that they are sold through July shipment on some of their selections. If this is the case, it will bode well for the market. Some buyers do not feel that is the case, pointing to the USDA Export Sales Report’s Outstanding Sales number. U.S. Cattle slaughter will move back over the 600,000 weekly number this week as the beef pipeline restocks itself after the holiday week. Will U.S. Raw Hide and Wet Blue suppliers be able to move sale prices higher for their wares this week? Well we think they can, but not by much. But, we do not think suppliers will consider bids below their last traded levels.
GOLF TRUISMS
Any swing change works for three holes.
One birdie is a hot streak.
