Sales activity in the U.S. hide market last week can only be described as lethargic. With the Lunar calendar New Year holidays commencing in full last week, Chinese tanners were shut down all week. It was not that the absence of these raw hide and wet blue buyers was unexpected, but many in the trade said it was quieter than they could remember it being during previous CNY holiday periods. The second largest buyer of U.S. hides, Korea, was also out for most of the week, but once they did come back there were a few tanners who were looking to buy hides. The hides that were sold last week were pretty easily sold at steady prices. As for last week’s traded levels, we would call the prices for U.S. Steer hides as follows: $71.00 for Heavy Native Steer hides, $69.00 for the Butt Branded Steer hide selection and regular-weight Heavy Texas Steer hides at $62.00 per piece, all FOB plant. All these prices are on what would be seasonal/regular weight range hides. Demand for Holstein and Plump cows was unchanged last week. Korea was active in the cow market last week, making up for the void left by the Chinese being on holiday. Prices for both Plump and Holstein cows were also steady.
The Export Sales Report released by the USDA on February 11, 2016 for the week ending February 4, 2016 showed net sales of 398,300 cattle hides and wet blue equivalents. That number is down considerably from the previous week’s total of 565,800 pieces sold. China was largest buyer taking 246,000 hides and wet blues. Vietnam was the second biggest purchaser, buying 44,100 units of which 40,200 we wet blues. Shipments for the week ending February 4th were 464,500 pieces.
The Federally Inspected Slaughter (FIS) for the week ending Saturday February 13, 2016 was estimated to be 544,000 cattle up 10,000 animals from the previous week’s estimated slaughter number of 534,000 head. For the same week last year the FIS was 540,429 head of cattle. Year-to-date estimated cattle slaughter is 3.397 million head down 1.9% from last year’s number for the same period of time.
We begin the week trying to get a hold on where the market stands after the CNY. As we mentioned above, it was the quietest many have seen it during this annual slowdown in the market, so this leaves many waiting to see what tanner’s ideas will be this week. It is safe to say that tanners are going to come back from the CNY with a pessimistic attitude about the market, and while that attitude is not without some merit, we still do not foresee much change in the market for this week. We look for there to be a feeling out period this week as tanners and suppliers try to get a grasp on the current state of the market. If previous years are repeated, we could see an active market this week as tanners fill their raw hide voids left by the holiday period. Then again, this year so far has been quite different than years past.
More of Mulligan’s Laws
You can lead a horse to water, but you can’t make it retrieve your ball
An extra ball in the pocket is worth two strokes in the bush
A penny saved is an excellent ball marker
