Hide prices begin to fall15 October 2003
The rapid rise in Texas steer prices which moved from $62.50 in August to nearly $68 in the third week of September, finally hit the ceiling in the last week of the month. Branded material fell by one dollar and prices eased on natives as well. Tanners and traders resisted when heavy Texas steers were offered at $67-68. While a few sales were made at $67 on 62/64lb averages, towards the end of the week bids of $66 were being refused. However, by the end of the week, business was being conducted at this level in order to move production. Total raw hide exports for the week ended September 18 were 559,700. China took the most with 202,800 followed by South Korea with 160,000. Thailand bought 57,000, Hong Kong 33,800, Japan 33,500, Taiwan 17,500 and Italy 16,000 plus 18,300 calf and kip. Figures for the previous week were unavailable due to the hurricane which hit the eastern US seaboard. A week earlier, South Korea took lead place from China with 263,300 followed by Hong Kong 53,000; China 44,900; Japan 39,600; Taiwan 36,200; Mexico 21,300; Italy 13,900 plus 21,000 calf and kip. Total exports for the period were 452,600. Wet-blue exports during the period to September 18 amounted to 72,000: Hong Kong 15,400; South Korea 13,600; Thailand 9,800; Taiwan 5,500. Two weeks earlier only 28,900 wet-blues were sold: Hong Kong 16,000; South Korea 10,200 and Domenican Republic 8,500. The slaughter rate has begun to fall and it is expected that within the next month the rate will have dropped to 600,000/week. The consensus among packers is that many tanners are currently under stocked and will need to buy before too long, giving the packers a reason for refusing to accept much lower prices. However, tanners are likely to hold back until they can see a profit on processing the hides. A further factor is the earlier Chinese New Year in January. This may well deter tanners from taking December deliveries as they need to ship their finished inventory to fit in with the holiday shutdowns.