For U.S. Raw and Wet Blue sellers there was a little carry over business booked early last week with Asian trading partners. But, by last Wednesday the U.S. hide market was so quiet you could have heard a calf skin drop. We don’t think a lot of the U.S. raw and wet blue hide suppliers were surprised by their lack of interest from their Asian customers. Last week was not the first time the Lunar New Year holidays effected their business. We can say with confidence that the U.S. raw hide sales that did take place last week were done at steady to slightly lower per piece prices levels. We don’t think any U.S. supplier got up money on any selection last week. U.S. Steer hide prices pretty much held their own, but the Plump Branded and Spready Cow hide values remained under pressure due to lack of demand. The Export Sales Report for raw and wet blue cattle hides released by the USDA last Thursday again showed a weekly sales number that was well below what we expected. We can’t help but speculate that some seller(s) are not reporting their sales, at least on a weekly basis. Cattle slaughter in the U.S. remained below the 600,000-head number again last week. As we mentioned in last week’s report, historically this month and next are slow months for beef sales. It is being reported that beef packers profit margins have evaporated, and some reports indicate they are currently operating in the red. Trading was thin last week and, as mentioned above, sales prices did not move much during the week. So, we are only slightly adjusting our FOB plant prices quotes for the seasonal average weight Big Packer Steer hides selections. We are keeping the Heavy Native Steer hide prices at $66.00 per piece. We are calling the Butt Branded Steer hide value $61.00, which is the bottom of our last week’s quoted range for this item. We only know of one Heavy Texas Steer hide sale that was reported last week, and it was said to have been done at $50.00 per piece. That price sounds too low to us, so consequently we are leaving our estimated value for this selection at between $52.00 and $54.00 per piece.
The Export Sales Report released by the USDA on February 15, 2018 for the seven-day period ending Thursday, February 8th. showed that 342,100 whole cattle hide, and wet blue equivalents were sold for export during that week. This number is up from the 307,300 unites reported to have been sold the prior week. The exports/shipments during the period were reported to have been 485,200 pieces.
Federally Inspected Slaughter, (FIS) for the week ending Saturday February 17, 2018, came in at an estimated 596,000 cattle. Almost identical to the prior week’s estimated 591,000 head processed. Year to Date FIS is an estimated 4,164,000 animals, which is up 2.7 percent from the same period a year ago.
Look for this week to be a slow one for the U.S. hide market. Maybe not as slow as last week, but there will still be many Asian customers out on New Year holiday for at least half of this week. Korean tanners should be back at work early this week. But, the Chinese, Taiwanese, and some other Asian tanners will not return to their offices until Thursday or Friday, at the earliest, while a sizable number of them will not return to their offices until next Monday. We do expect, however, that many of the holidaying hide buyers will not be far from their handy phones. They will be keeping their eye on the market, looking for any chance that they may be able to pick up some raw material at a bargain price. Will there be any bargains out there? We don’t think there will be much of a chance to buy any of the U.S. Steer hides at lower prices, but Cow hides may well be another story.
Golf Quote
“He goes after a golf course like a lion at a zebra. He doesn’t reason with it…He tries to hold its head under the water until it stops wriggling.”
– Jim Murray on Seve Ballesteros
