I received these replies from my post on another leather guild site. Very good info. I love it when I learn something (it happens every once in a while).
Art
Cattle numbers are really not that low. They have been declining for some time now because more people are eating chicken!!! Just like the commercial tells 'em to do.
As a point of reference, Jan2009 cattle inventory stood at 94.5 million compared to 96 million last year or down only 2%. Going back 5 and 10 years, Jan 2004 inventory was 94.9 and Jan 1999 was 98.5.
Gary
An old Ag Economist from VaTech
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Art,
It will have little short term effect on leather prices. Those prices seem to be more driven by demand than supply. That demand seems to mostly hinge on orders from the Asian tanners. With sagging auto and furniture sales, the demand will slow for hides processed into upholstery leather. There is yet another glut of dairy cows and many of those cows will coming on the market. Also the US is not the only source for hides globally.
Also like most other agriculture commodities, the cost of the raw material is a small part of the final consumer cost. Transportation, processing, and marketing add much more to the final price.
Bruce Johnson