THE HIDE MARKET – APRIL 23, 2018
U.S. Raw and Wet Blue Steer hide suppliers lowered the prices they would accept last week to move product. Those prices were reported at levels down between $1.00 to $2.00 per pieces on the Branded Steer hide selections and, depending on who you talked to, steady to down $1.00 for the Heavy Native Steer hide. According to tanners, the main reason for the weakness in the Branded Steer selections was a lack of shoe orders. At the same time, the continued demand for auto and furniture upholstery leather has increased the spread between the values of the Native and Branded Steer hide selections. It is hard to determine how much product U.S. Steer hide suppliers were able to move after lowering prices last week. The activity reported and seen in the market did not appeared to be large. But, rumors persisted regarding some U.S. producers/suppliers made large volume sales, at lower-than-reported prices, to some of the larger tanners. We may see the results of those sales when the USDA releases its Export Sales Report for the week ending April 19th. Last week’s cattle slaughter number jumped up to over 620,000 head, which was expected. We assume all U.S. hide suppliers had dialed the expected increase in the slaughter numbers going into the grilling season into their sold positions.
Despite the continuously discouraging reports from Asian tanners regarding the competing items from South America and Europe, prices for U.S. Cow hides seemed to have stabilized last week. While most of the U.S. Cow hides that were sold were done at steady money, the Southwestern Branded Cow hide selection saw a jump of $1.00 per piece in their reported sale prices. Seemed that U.S. Cow hide suppliers were more at ease, last week, with their sold ahead positions than they had been for some time.
Our FOB plant price quotes for the Big Packer Steer hide selections at the close of business last Friday are as follows: Heavy Native Steer hides $63.00 per piece, unchanged from the previous week. Butt Branded Steer hides $55.00, down $1.00 to $2.00 per piece, and Heavy Texas Steer hides at from $47.00 to $48.00 per hide, also down $1.00 to $ 2.00 per piece from our last week’s quoted price range.
The Export Sales Report released by the USDA on April 19, 2018, for the seven-day period ending Thursday April 12th showed that a net 536,100 whole cattle hide, and wet blue equivalents were sold for export during that period. This number is down from the net 720,800 pieces reported as sold during the prior week. Exports/Actual shipments during the week ending April 12th were reported to be a healthy 608,800 units.
Federally Inspected Slaughter, (FIS), for the week ending Saturday April 21, 2018, was an estimated 624,000 head of cattle, versus the 600,997-head processed during the corresponding week last year. Year to Date FIS for Cattle is up an estimated 218,000 head or 2.3 % from a year ago.
Expecting U.S. hide suppliers to be asking the same prices for their Steer hides as they did last week and looking for sale prices to be in line with the business they put together last week. For the Cow hides that U.S. suppliers will be offering this week, we expect to see some steady and some higher asking prices, depending on selection and origin. We do expect U.S. cattle slaughter move stay well above the 600,000 number for the near term. With most of the added production coming from the fed/fat cattle side, not the Cow sector. U.S. hides, especially the Cow hide selections, remain on what we can call the cheap side. Let’s see how tanners feel about those prices this week.
GOLF QOUTE
A great round of golf is a lot like a terrible round. You drift into a zone, and it is hard to break out of it.
– Al Geiberger
