Tanners look to Eid for recovery

‘This year most of the political leaders will sacrifice animals, while in last two years many leaders were not in a mood for public relations activities’, said Rezaul Karim Ansari, chairman of Bangladesh Finished Leather, Leather Goods and Footwear Exporters' Association.
The number of sacrificial animals was also low in 2007 because of cyclone Sidr that had devastated many people financially and left a big number of animals dead.
Prices of raw and finished leather are still very low both in domestic and international markets. However it will be possible to collect higher quantities of raw hides this year, and process those for export in a world market where prices have declined significantly in recent times due to global recession.
Bangladesh tanners process over 220 million square feet of leather every year, of which 100 million sft is sourced during Eid-ul-Azha.
‘The positive thing is that export demand has been on the rise for the last two months, helping the tannery owners sell their stock piled leather’, said Tipu Sultan, former president of the association.
Leather export plummeted almost 25% percent in the July-September quarter of the current fiscal year, earning $45.5 million, while exports of footwear during the same quarter was worth $56.2 million, a 2.9% fall.
The main destinations of locally processed leather are Europe and the Far East. The global recession reduced leather demand in Europe although demand is picking up in the Far Eastern countries after the slowdown.
‘China and Hong Kong bought a huge amount of leather in last two months, helping us sell off our stock piled leather’, said Mozaffar Rahman, executive member of Bangladesh Tanners' Association.
Prices of finished leather have declined 30-40% in the last year in the global market, causing a huge loss to the local tannery owners. As an impact, rawhide price has halved on the local market in the last year.
‘Prices of rawhide will remain at the level of its previous year's price but collection will be high, and the tanners will be able to collect it at a moderate rate’, said Tipu Sultan.
If it is possible to buy hides at lower price, it will also be possible to export at reduced rate, he added.
‘Leather exports didn't decline much in the last year in terms of quantity, but dipped in price, and a competitive supply rate will help the sector’, commented Shahin Ahmed, president of the tanners' association.
He also said that available funds from the banking sector will also play a vital role in rawhide collection, and urged bankers to relax loan disbursement rules, as many businessmen could not repay loans last year due to a gloomy export performance.
Source: Daily Star Dhaka