Hide Prices-ACLE

Hide Prices-ACLE

The following chart tracks BBS and NBC hide prices post ACLE from 2011 through today. Although the story has yet to be written for the 2015 fair, follow through early signals indicate a recent uptick with the US steer market seeming to have stalled with prices holding steady during the leather show into this week.

The chart below shows a mixed pattern of hide price trends post show with prices increasing three out of the last five years. Despite record-low kills, the slowing growth in China is weighing heavily on its leather markets, particularly those for domestic consumption which rely heavily on US cowhides and other global sources.

The US hide market was steady for steers and dairy cows with plump branded cows and lower-end hides remaining under pressure last week. The Jacobsen Hide Index closed on Friday with little change from the prior week at $64.92 from $64.20. Heavy Native Steers and Butt Branded Steers traded steady at $77 and $75 on the top ends while Northern and Southwest Branded Cows traded down about $1.50 ending the week at $36 and $34.50 respectively. Several people said it was extremely difficult to find buyers for both Branded Cows and special low-end material. The shortened holiday week, along with low kill and people traveling to Lineapelle in Milan, is expected to keep the market on the quiet side this week.

Today’s Market
The market was quiet today with few offer lists out and no carry-over sales reported. Hide shipments from some Canadian hide sources have been suspended to China, Taiwan and Vietnam due to Canada losing its bluetongue-free status. Findings of bluetongue in three cattle from one farm in Southwestern Ontario tested positive for bluetongue. Impacted hide suppliers report they are working on the issue.

INTERNATIONAL

Argentina (September 10)

All variables remain unchanged from last week.

Wet salted Buenos Aires steers hides are trading unchanged at around US$1.15 per kg.
Expectations regarding the Milan Lineapelle results are not positive.

The slaughter in August was 3% less than in July and 5% more than in the previous August (2014). It was affected by an agriculture strike during the last week of the month which affected the livestock marketing movement. The first eight months of the year, the annual increase is 2%. In turn, the percentage difference for the last quarter is +2%, but for the last 12 months it is -1%.

Paraguay (September 10)

Raw hide prices are settling lower. Frigorificos fresh hides are trading at US$0.70 per kg and fresh hides from abattoirs are US$0.50 per kg.

Wet blue hide prices remain unchanged from last week. Wet blue full substance TR1 hides are around US$1.10 per sq. ft. and wet blue TR1 divided hides are around $1 per sq. ft. TR3 is $0.75 per sq. ft.; however, many speak about important prices reductions for next week.

The meat industry continues to grow. During mid-2016, two new large frigorificos will come into operation. These plants will each have an installed capacity to process 1,000 heads per day. The export growth this year shows an increase of 5% over the same period of 2014, ranking as the world’s sixth largest exporter of beef.

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