Things were busier than we had expected for the U.S. Market last week. We thought we would see a lack of activity due not only to the fact that last week was a holiday shortened week, but also because a number of the individuals responsible for raw and wet blue hide sales at their companies were out of their offices. However, there were a good number of tanners in the market looking to buy some raw material, and placed bids with suppliers. The majority of the opening bids that were submitted to U.S. raw hide suppliers by tanners were $1.00 to $2.00 lower than producer’s most recent sales levels. As the week progressed, sellers were able to convince their customers to pay prices that were steady with the last sales prices. There were of course some Steer hides traded at slightly higher and slightly lower prices than their most recent levels. No raw hide or wet blue selection to our knowledge was sold for more than a $1.00 higher or lower than its most recently booked price. In the end, we would call the Steer hide market steady due to more than expected demand. Last week’s interest in U.S. Cow hides, like that for the Steer hide selections, was greater than we had expected. Consequently, there were more U.S. Cow hide sales finalized than we anticipated. We can say with relative confidence that the U.S. Cow hides that were sold, were done at no less than steady money with a number moving at marginally higher prices. The Chinese tanners were the most active in the market, but Korean tanners also had a presence. Cattle slaughter number here in the U.S. was down last week because of one less production day due to our national holiday. For last week, we are calling FOB plant price for seasonal average U.S. Big Packer Heavy Native Steer hides a steady $75.00 per piece. Big Packer Butt Branded Steer hide price at $72.00 per piece, FOB plant basis. This is steady with the high end of our prior week’s price range. Heavy Texas Steer hides were reported by one of the Big Packers at $69.00 per hide plant basis.
The USDA’s Export Sales Report released on December 30, 2016 for sales made during the seven day period ending Dec. 22, 2016, indicated that 431,300 U.S. hides and wet blue equivalents were sold for export during that week. This number is down from the previous week’s 491,300 pieces reported as sold for export. Weekly Exports (actual shipments) for the period ending December 22nd were reported to be 548,800 units.
The Federally Inspected Slaughter (FIS) for the holiday shortened week ending Saturday December 31, 2016 was estimated to be 507,000 cattle, down from the prior week’s 572,000 head. Year-to-date the FIS is up 5.7% from a year ago.
It is Tuesday, and our yearend holidays are behind us. We expect everyone in the U.S. who are involved in hide and wet blue sales will be back to work today and raring to go. How much demand will these suppliers find for their raw and wet blue hides this week is the question. We figure that any interest we see from the Chinese tanners this week, will be for February shipment. We feel they have bought what was needed for arrival in February, when they return from their Spring Festival/Chinese New Year holidays. Honestly, the Chinese tanning industry is the “straw that stirs the drink”, for U.S. raw and wet blue hide markets. Yes, there are other good destination country tanners such as those in Korea, Japan, Taiwan, Vietnam, Mexico and Europe who burn U.S. raw material, but with China taking well over 50 percent of the U.S. production, it is the one. On the positive side for the U.S. suppliers is the fact that they have decent sold positions, and hide prices are at levels that seem sustainable. Let’s see how it goes.
More Quotes from golf announcer David Feherty
“That’s a great shot with that swing.”
“It’s OK – the bunker stopped it.”
“That green appears smaller than a Pygmy’s nipple.”
