Weaker raw materials market in Europe

The Ron Sauer blog
Published:  13 June, 2014
Ron sauer

The general trend in the European raw materials market is now clearly weaker. Today we are seeing lower prices for hides in France, the UK and Ireland, Sweden, Poland and Finland. In other countries, which did not really reduce their asking prices (such as Germany), surely everything can be negotiated.

All the now known prices reductions were necessary but it took quite a long time before it actually started happening in the market between suppliers and tanners. It all began with the cows and the low grades but better selections now have to give in as well to downward corrections.

The question is whether it will continue and for how long and how much. It is fast approaching the summer holidays in Europe, which should assist further depreciations, however this has to be counter balanced against low summer kills.

The fact is that in Europe the big meat groups, the luxury groups and the car makers have their long term contracts (3 months and more) which have already secured a large volume of production. This will work as a counter against too large overall price changes for the hides that remain freely traded. The lions have taken their meal, now the rest of the family may fight for what is left.

Ron Sauer

www.theSauerReport.com

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