U.S. Steer and Heifer hide sale prices last week were basically steady to slightly higher on a few productions. Our feeling was that the volume of business booked was a good deal lower than the average sales of the prior three weeks. We say this, not only because of the interest we saw from tanners but also because there seem to be less pressure for sellers to move product. This was indicated by the fact that suppliers in general presented shorter offer lists to their customer base. Also, along the same line, several Asian buyers indicated that they were waiting to meet with sellers who are or will be traveling, calling on customers this week and next week during the “All China Leather Exhibition” which will be taking place from Wednesday, August 30th thru Friday, September 1st. There were a select few packers/suppliers who indicated that they had put together a good volume of sales last week. We are guessing, from what we saw and heard from tanners last week, that a good many of these sales may have been made to traders who were either buying to cover shorts or buying some product to have in their pockets to sell when meeting with their tanner/customers in the coming two weeks.
The USDA Export Sales Reports on raw hides and wet blue hide sales reported last Thursday was a decent number, below the prior two week’s reported numbers, but not bad. Last week’s harvesting of cattle by U.S. Beef Packers remained over the 625,000 head per week number. We still believe that this weekly cattle slaughter number will remain for the next couple of weeks before it starts to retreat a bit.
As mentioned above almost all reported sales last week were done at steady levels, only a few at slightly higher levels an only a few at slightly lower levels. Therefore, we are going to leave the top end of the Big Packer seasonal average Heavy Native Steer hide value at $62.00 per piece FOB plant. We are also going to keep the FOB plant prices, for the Big Packer Butt Branded Steer hide and the Big Packer Heavy Texas Steer hide values unchanged at between, $55.00 and $57.00 and between $50.00 to $51.00FOB respectively. Last week’ sale prices for all the U.S. Cow hides did not appear to be brisk but the sales that were made were put together at prices we would call steady to $1.00 higher.
The Export Sales Report released by the USDA on August 17, 2017 for the 7-day period ending Thursday August 10th stated that 549,400 whole hides and wet blue equivalents were sold for export during that week. This sales number followed the large 688,300 pieces number reported for the week prior. China was credited with taking 286,100 units or about 52 percent of the number sold. Korea was the second largest purchaser taking 88,000 raw hides only.
Federally Inspected Slaughter (FIS) of cattle for the week ending Saturday August 19, 2017 was estimated 634,000 head. Year-to-Date FIS is estimated to be up 1,127,000 head or 6 % from a year ago.
All involved in the marketing of U.S. raw and wet blue hides will have their eyes and ears focused on Asia this week and next with most of that focus being on the Chinese tanners. No question the U.S. hide market was grounded last week, but we did not see much, if any, bounce in hide prices that we have come to expect when the market bottoms out. We have been told by a sizable number of Asian tanners that they do expect to get some finished leather orders soon and we assume that means over the next few weeks. For sure, a steady to firmer hide market would help tanners in their negotiations with their finished leather customers. This week and next should be interesting, and should give us a good clue as to the direction of hide prices this fall.
GOLF QUOTES
If you can’t enjoy the time between the golf shots, then you are going to have a pretty difficult life because most of your life is the time spent in-between.
– Peter Jacobsen
