Raw materials


but economic forecasts and product orders made it clear this would have to wait until sometime in the second half of 2023. One of the issues for some sellers was the weight of hides, which were trending heavier throughout most of the first three months. This meant that regular-weight steers were in shorter supply, allowing packers to edge prices a little higher in February. Alas, what looked like the start of a promising period has fizzled out. As packers continued to push for higher levels, customers became increasingly reluctant to buy and certainly not at higher prices. The few weeks of a slightly firmer market turned out the be a ‘dead cat’ bounce that didn’t last all that long. Moreover, it wasn’t a select group of customers who refused to pay more – it was generally all of them. The lack of common ground between buyers and sellers when it comes to price was the norm for most of March, and its therefore not surprising that export sales were far from healthy. While not as problematic as it was in 2021, shipping was again causing issues for hide sellers. Ocean freight carriers are idling a growing share of their capacity and cancelling some sailings, on top of the decline in demand. The increase in blank sailings has led to a shortage of empty containers, as they are all stacked up in China. In fact, the Journal of Commerce reports that US container imports from Asia hit a three-year low in February. Another market focus has been cattle supply. Some pointed to the projected shrinkage of the cattle herd as a reason for optimism, and that lower supply would help the hide market. Supply can give the market an indication of direction but it’s not going to happen without demand.


For a few weeks, it seemed that even lower prices could not entice customers to buy. And, while slaughter was slightly declining each week, by the last week in March it had popped back up to 651,000 – not welcome news for hide sellers. That said, packing plant capacity utilisation at the end of March was estimated to be 85.2% compared with 88.1% last year.


The outlook going forward is not very positive. Numerous sources felt that prices would have to go lower for sellers to move all the hides produced in the US. Moreover, leather business is just not good right now, and the market is likely to remain under pressure for the foreseeable future. ●


Leather International / www.leathermag.com


Colorado steers 60 –


50 – 40 – 30 – 20 – 10 – 0


1020304050 Weeks


Dairy cows 45 –


35 –


2021 2022 2023


25 –


2021 2022 2023


15 –


5 – 0


1020304050 Weeks


Heavy native heifers 50 –


40 –


2021 2022 2023


30 –


20 –


10 – 0


1020304050 Weeks


Heavy native cows 40 –


30 –


2021 2022 2023


20 –


10 –


0 – 0


1020304050 Weeks


23


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