Kills run at very high levels12 January 2005
Kills ran at very high levels during November and into December, and were expected to continue right to the end of December with January very quiet until the effects of de-coupling fully impact the marketplace. Current kills are 40,000+ cattle per week and this will fall to 15,000 for the weeks commencing December 20 and 27. During the first two weeks of January the kills will fall to 10,000 cattle per week. After that we will have to wait and see what happens. However, all are agreed that European cattle numbers will fall by 20% over the next three years if beef selling prices do not improve. While kills have been at their seasonal peak, hides have been moving steadily to tanners with supply in harmony with demand. Italian tanners have been active in the last two months of the year, although their purchases appear to be according to soaking requirements and not for stock. UK tanners have been busy but warn that orders for January are very scarce. This is normal for this time of year. The leading footwear tannery in the UK still gives us cause for concern but we hope that their latest restructuring will help get them back into profitability. Unfortunately the weakness of the US dollar which has hit the tannery is also affecting the price of hides. This cannot be avoided and with all the predictions since the American presidential election indicating that further falls in the value of the dollar are unavoidable, the hide market must inevitably slide on the back of the dollar. Hide prices softened in November and into December on currency movements, not because of lack of demand. This was despite extra hides in Europe that arose from Chinese buyers not opening L/Cs for hides booked in September. Hide prices in early December were as follows: 36kg + 76p 31/35.5 86p 26/30.5 85p 22/22.5 93p It was announced that the testing of animals over the age of thirty months for BSE would be introduced in the UK with a view to getting the meat from these animals back into the food chain. This would be the first step into getting the cull hides back onto the international marketplace. This is seen as a very welcome step. Cows went for £17.50 salted in December. The skin business continues to be a disaster with lack of demand compounded by weak currency. Irish fellmongers went for £2.50 ex yard and doubleface sold for £3.50 ex yard.