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United States – Price corrections ahead?

Published: 13 Jan, 2021

Bar a very brief couple of trading days at the start of the year, when some weights and grades of hides showed some slight price correction, generally speaking, most new trading since the start of the year has been at steady levels. Without seminally too much room for price negotiation on either side, the status quo appeared to be the pattern set for the short term. The only real problem suppliers reported was the ongoing issues with shipping logistics and ever increasing shipping rates, which not only eat into margins, but make forward programme making somewhat of a headache. Already suppliers where trying to work around hides’ arrival before or after the Chinese New Year, or face demurrage charges if containers arrived during that period. Then the news broke of the new virus cases within mainland China, which first started with port closures, quickly followed by lockdowns of entire provinces. This is now causing concern for not only shipping, but future sales. The slaughter is still running high in the U.S. on the back of strong demand for beef for the export trade. The slaughter finished the first week of January at over 650,000 head, which is above the corresponding week of last year, and that pattern is likely to be repeated again this week, and for the next few weeks at the minimum. Wet-blue hide sales were very hit and miss last year. Some weeks records were broken for the high numbers sold, followed by a period when weak sales numbers were reported. Some of the low prices of last year were needed to tempt tanners around the world into buying. Early reports from this year indicate that for the short term at least, the bumpy road will continue.

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