With many Asian tanners gone from their offices for a good portion of last week sales of U.S. raw and wet blue hides were noticeably reduced. By Thursday and Friday enough buyers were in the market to make it interesting, but a larger percentage of those bids came from tanners located outside of China. Korea, Europe and Mexico were in the market and purchased many hides before weeks’ end. Many of the bids for U.S. Steer hides came in lower than their last traded levels, but we do not think that any supplier accepted such orders. From our viewpoint the Steer hides that were sold last week were done at prices one would consider fully steady with the prior week’s sales. U.S. Cow hide prices remain on firm footing as suppliers remain well sold ahead. Those suppliers were successful in squeezing out marginal price increases on Plump Native Cow and Dairy Cow selections, as they continue to be the most sought after of all the Cow hide selections. U.S. cattle slaughter last week was up a little from the prior week. This slaughter level is within the lower end of the range that is expected for the first quarter of the year. So, our quotes for the value of the seasonal average Big Packer Steer hide selections remain steady with our prior week’s quote. We are keeping the U.S. Big Packer Heavy Native Steer hide price at $76.00 per piece and we are keeping our quote on the U.S. Big Packer Butt Branded Steer hide at the $74.00 per piece, both prices FOB plant basis. Likewise, we are putting the value of the seasonal average Big Packer Heavy Texas Steer hide selection at $71.00 per hide plant basis. Although sales prices of U.S. Dairy Cow hides inched up last week, sales volume slowed for several reasons, such as fewer offers and fewer buyers in the market.
The USDA’s Export Sales Report released on February 2, 2017 showed net sales of 469,700 U.S. cattle hides and wet blue equivalents for the weekly period ending January 26, 2017. This number is down considerably from the 708,700 pieces reported to have sold for export the previous week. But, still a pretty good number when one considers that the Chinese New Year holidays were pending in Asia and that a good number of the tanners there did not work for part of the measured period. Another interesting thing about the report was the rather large percentage of wet blue hide sales reported
The Federally Inspected Slaughter (FIS) for the week ending Saturday February 4, 2017 was estimated to have been 593,000 cattle, creeping up from the previous week’s estimated 577,000 animals. For the same period last year, the FIS came in at 535,000 head.
We do not believe that U.S. producers/sellers, as a whole, were able to move a full week’s production of their raw or wet blue material during either of the last two weeks. But, we do believe that most suppliers, Cow hide suppliers for sure, have decent sold ahead positions. We do not believe that the tanner/customers for U.S. hides and wet blue have comfortable raw material ownership currently. Which leads us to believe that things may start slowly this week as buyers return to their offices and began to assess the market and their positions. But as the week progresses we expect to see an increase in confirmed sales. We expect contract prices on all hide and wet selections to hold at least at steady levels or to move slightly higher. Welcome back to all those returning from holiday. Have a great week!
Mulligan’s Laws
All of the basic movements of a perfectly executed pivot can be easily duplicated by using a forceful turning motion of your body to toss a bag full of clubs into a pond.
