Raw materials


prices rising, no matter what was happening with US cattle slaughter.


The overall feeling was that sellers should be happy with current market levels being stubbornly steady. This is particularly true as these levels will likely persist into 2024 and possibly until after the Lunar New Year holiday.


Throughout the final months of 2023, packers often struggled to conclude sales. They tried to hold prices unchanged, but customers were bidding aggressively lower. Of course, when the market begins to soften, rumours abound regarding below- market sales. This dovetailed with assertions by packers that customers prefer to buy directly rather than from other sellers. While that’s probably true, it was also probably true that those sales were discounted deals.


Automotive leather demand was unscathed by the US autoworkers strike and prices remained quite steady. Ultimately, suppliers did not have to make any adjustments to their purchasing due to the strike and continued to see “normal” volumes from customers. Sadly, one of the reasons that the strike did not have a big impact on auto leather is because the removal of leather from car interiors is a reality. Sources say that some programmes that have historically purchased 3,000-plus hides per week have been reduced to fewer than 100. The market’s view that leather is less environmentally friendly than the alternatives is a fallacy that our industry so far has not done enough to quash.


Still, many times, auto leather has been one of the drivers that helps keep the hide market stable – as it was in recent months. As one producer stated, at least the automotive leather sector has been OK because the footwear leather market is not.


Increase in demand?


For things to improve overall, the shoe tanners in China need to ramp up purchasing. This doesn’t seem possible in the near term as sources say that many shoe tanners are working at 60% capacity. Unfortunately, it will likely be some time before a general increase in demand can be expected. China’s economic struggles are well known and consumer purchasing in other regions is also lagging. Additionally, Chinese customers report that the lime split market has dropped, which is also not helping the situation. It’s not just tanners who are pushing for lower hide prices either. Sources say that gelatine and collagen customers are also holding out for lower levels thanks to too many hides going to that market, which is also seeing low demand. The overall sentiment among sources has turned rather negative. ●


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