People have their own views on whether Asian leather orders will decline or decrease. Some producers stated that based on their perceived willingness to purchase and willingness to ship, and their very low inventory (perhaps the lowest in six months), they believe the situation does not exist. A packager said that some car and footwear leather buyers are fully purchasing leather, which is not related to domestic demand. For him, this proves that Asia needs leather at any time.
What needs special attention is that the price of live cattle has reached a record high. This makes all businesses (except slaughterhouses) unprofitable. Therefore, in order to regain profits, businesses must push up the price of by-products, of which hides are the most valuable.
Car sales continue to grow and is expected to increase to 14 million units in 2012. There is no doubt that this is related to the consumer confidence index rising again (up to April 2008). Good news!
However, the number of hides available for use in automobiles and for use in the coming years is small. Since January 2011, the number of cows that have reached the lowest point (no more, many, one cow is a hide) has dropped by 1.5% again.
The main reason for the decline in the number of cattle was the worst drought in Texas this year, which was mainly produced in Niuzhou. Another reason is that due to the rising cost of food, many cattle owners have pushed their cattle to slaughterhouses. Now that the number of cattle has decreased, experts say that not only this year, but also in 2013 and 2014, the supply of cattle will be very tight. Once the number of cattle has risen again, it will take 2 years to return to normal supply levels. The total number of cattle this year is expected to drop by 1-2%.
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