In New Zealand we continue to witness two opposite trends characterising the ovine skin market. The long-term crisis in the nappa leather market continues to reflect negatively on demand for pickled lambskins, keeping prices depressed and volumes dropping. On the other side, the wool-on skins continue to enjoy good demand albeit at lower prices than last season. This is anticipated to last until the January/February kill, when the suppliers should restart pickling. A trader, only half-jokingly, wondered whether it will in fact take place as usual, or skins will be dumped instead, due to low value and interest from buyers.

Trade figures support the above scenario. In the first eight months of the year, NZ exported just over 8 million wool-on skins, showing an 8% increase from the previous year and a 32% increase from the previous three-year average. Over 95% of these skins is regularly destined for China.

Conversely, over the same period 5.8 million pickled skins were exported, down 28% from the previous year and a 39% from the previous three-year average, underscoring the magnitude of the drop. The top buyers of these skins in the Jan-Aug period of the current year were Pakistan (20% share of quantity), Turkey (18%), France (15%), Italy (14%) and India (12%).

From The Sauer Report