With New Year’s Day falling on Wednesday last week, the amount of business that was put together on U.S. raw and wet blue hides was lower than normal. Suppliers put out their hide offer lists early in the week, which contained fewer selections and fewer quantities than the prior week’s lists. Tanners responses to those offerings, like the offer lists themselves, were also limited. By the end of the week, sellers and buyers did get together to put a limited amount of business on the books. Some of the hides sold last week were selections that suppliers did not have on their offer lists, like Dairy Steer and some specific origin Dairy Cow hides. It has been apparent for some time now that the demand for good grading/grain quality hides is out pacing the supply of those selections. We don’t expect that situation to change as we move through the winter and into the spring in the northern hemisphere. Prices for Plump/Beef type Steer/Heifer hides that were traded last week improved by $0.50 per hide on average. But, on a whole one must call the market for the Plump Steer/Heifer hides unchanged. Our feelings regarding last week’s business on the Plump Cow hide selections were mixed. It seems there has been decent interest in Plump Native Cow hides recently, and the value of those selections has moved higher over the last couple of weeks. Last week, interest for Branded Cow hides was minimal, but we believe any Branded Cow hides that were sold were done so at no better than steady money. Even with last week’s holiday-reduced cattle slaughter number, we don’t feel that hide sales matched the week’s production.
Below are our current per piece FOB plant price quotes for the seasonal average weight Big Packer Steer hides:
- Heavy Native Steer hides at $39.00 per piece, up $0.50 for the week.
- Butt Branded Steer hides at $36.00 per piece, up $0.50 for the week.
- Heavy Texas Steer hides at $26.00 to $28.00 per piece, up $0.50 for the week.
Last Friday the USDA released its Export Sales Report for the 7-day period ending December 26th. The report showed net export sales of raw and wet blue hides, for shipment this year and next to be 647,800 pieces. This number is up from the 548,800 pieces the USDA reported to have been sold the previous week. China was the biggest buyer, purchased 351,400 pieces or about 54 percent of the export sales.
The USDA estimated Federally Inspected Slaughter (FIS), for the holiday shortened week ending January 4, 2020 was 546,000 cattle. That number is up from the previous holiday shortened week’s estimate of 468,00 head knocked.
We certainly expect leather demand to improve as we move through 2020. We don’t know how much or how quickly that demand will grow. But, any demand for leather going forward will lift the demand and value of U.S. Packer hides. Our wish here at Braun & Co. is that this year’s increase in leather demand will return to a point to where the prices tanners can pay for Small Packer and Renderer hides will reach levels that makes them worth processing. It just such a shame that this recyclable raw material has been, and is still, going to waste.
GOLFERS
First golfer: “Hey. I don’t like the way you cheat all the time when we play together.”
Second golfer: “If you’ve got a better way, I’m open to suggestions!”
