Most all reports are in and the conclusion is that there is only one way to describe last week’s All China Leather Exhibition (ACLE) in Shanghai, and that is QUIET. The consensus was that there were fewer attendees and fewer patrons and visitors at the show this year than last. However, many feel that this show was still far better for the hide and leather industries, than the Asian Pacific Leather Fair that is held annually in Hong Kong at the end of March. The number of hides and wet blue traded last week was less than packers, processors, and dealers, had hoped for, and we think well below the week’s production. There were a good number of Tanners bidding on raw hides and wet blue last week, however a lot of those bids were not within the range of acceptability for suppliers. Most suppliers did mention that they were able to do good business in the days prior to and after the show than during the show itself. Shoe leather tanners who attended the ACLE stated that their business remained slow. On the other hand, the auto upholstery makers said they continue to be busy, as did some of the handbag leather tanners. The word was that the furniture leather tanner’s business has improved marginally. The U.S cattle slaughter number creeped up to just over 600,000 head last week. That number can be attributed to a number of factors. This week, being a holiday shortened one, will reduce the number of slaughter days available to packers. The Labor Day holiday is normally a good one for beef sales, there are currently plenty of market ready cattle available to packers and the packers have positive margins. The big news last week however, was the announcement that Hanjin Shipping Co., the world’s 7th largest by capacity, was filing for bankruptcy after years of losses. Everyone in the export business will have to monitor this situation carefully to see what affect this will have for the immediate and distant future. As for hide prices last week, the FOB plant market value for Big Packer and equivalent steer hides did not change much last week. The Heavy Native Steer hide price was between $73.00 and $74.00, up a half dollar from a week ago. The value of the Big Packer Butt Branded Steer stood at between $71.00 and $72.50 which is up $.50 on the high side for the week. The FOB plant value for Big Packer Heavy Texas Steer hides remain unchanged at between $65.00 and $67.00 per piece. Demand for U.S. Cow hides was good for the premium productions last week, with prices on those origins remaining firm. It was said that the lesser, lower quality Cow hide productions, were under lower price pressure.
The USDA’s Export Sales Report released on September 1, 2016 for sales made during the seven day period ending August 25, 2016 showed that 573,700 hides and wet blue equivalents were sold for export during that period. This number is about 12 percent higher than the 506,100 pieces reported sold for export the prior week. China was reported as the destination for 309,800 units or 54 percent of the pieces sold.
The Federally Inspected Slaughter (FIS) for the week ending Saturday September 3, 2016 was estimated to be 604,000 cattle. This number is up just slightly from the estimated 600,000 head knocked the prior week. Year-to-date cattle slaughter is an estimated 19,998,000 head up 4.3 percent from a year ago.
Those who were traveling in Asia the last week or two, visiting customers and attending the ACLE, will be back in their offices this week. They will be settling in and checking their sold positions on the various selections they produce. We believe that few if any of those assessments will indicate that any supplier extended their sold position on any selection. As mentioned above, the shot in the arm that the U.S. hide market was looking for last week was not administered by the activity that was seen at ACLE. The show was not a total loss, there was business done there, but we don’t think anyone came away from the show with the feeling that the leather business was on the verge of a big demand period. It was more just status quo. This week may just continue uneventfully in that mode.
More of Mulligan’s Laws
No matter how early your tee time, there will always be a foursome in the middle of the first fairway.
The only really useful golf tip is one given to the starter to get you out ahead of a mixed foursome.
