Fallen stock costs are set to increase

editorial image

A significant and continued fall in hide values due to a drop off in demand for leather from the footwear and the automotive industries will have a knock-on effect on fallen stock collection charges this autumn and winter, warns NFSCo (The National Fallen Stock Company) – the organisation which works with fallen stock collectors across the UK to co-ordinate the collection of fallen farm animals and horses.

The hide market has collapsed over recent years with most collectors now receiving less than £10 a hide today, whereas back in 2014 those same fallen stock hides were worth in excess of £30 – a two thirds drop!

“This devaluation may force collectors to increase service costs for bovine collections and disposals, potentially before the end of 2018,” warns Ian Potter, who runs NFSCo’s administration.

“The dramatic fall has resulted in most collectors questioning the commercial value and effort in continuing to remove, trim, salt, pallet and load hides,” he adds.

“Several collectors have recently thrown in the towel on hides entirely and laid off their skinning teams, while others soldier on against the odds because they do not wish to lose the valuable and irreplaceable skills that are now at risk.

“These collectors hope the market will do a U-turn, however all the signs are that the demand for leather is fragile, with synthetic substitutes gaining popularity. The uncertainty of possible tariffs as a result of Brexit also adds to the negative sentiment and culminates in a generally pessimistic outlook.”

Mr Potter continued: “I have spoken to two collectors this week, who have indicated that market prices could fall back to £6 per hide once we get into October.

“Northern Ireland will not be immune from these changes. It is up to individual collectors to set the prices they charge. But’s it’s hardly likely that they will be able to absorb the ongoing market changes without passing the impact of these developments down the line to farmers.”

On October 1, all registered members of NFSCo who have elected to receive collector prices by email will receive an up-to-date price list detailing the prices for collectors operating in their postcode areas. These prices will include collection & disposal charges as well as disposal only prices.

Commenting on these developments Ulster Farmers’ Union (UFU) deputy president, David Brown said: “It is a concern that farmers could see fallen stock collection prices rise this autumn and winter. We understand the hide market is supply and demand driven, however, the news couldn’t come at a worse time.

“Typically, on-farm costs increase during the winter and many farms will still be counting the additional costs the last few seasons have brought. Despite the good spell of weather this summer, the last few years of poor weather have resulted in an increase in fallen stock numbers and ultimately this has put significant pressure on farm businesses and farmers’ mental wellbeing.”