Hides shortage hits furniture producers

The aisles of the Showtime fabric-and-leather trade show this week served as a microcosm of the economic opportunities and challenges in both industries. Showtime, a semi-annual show held in High Point, North Carolina, USA, typically draws about 2,500 participants. Leather exhibitors said that a shortage of hides, particularly in Argentina and China, is likely to raise the price of sofas and recliners in 2008. The Economic Times reported that the cost of raw hides and skins have gone up about 30% worldwide this year.

The shortage in Argentina is related to a governmental limitation on the export of beef in an attempt to keep food prices low for citizens, said Chris Thomas, a vice president of sales for Universal Leather.
‘Less beef being exported means less hides being exported, as well,’ Thomas said. Universal Leather has been minimally affected because of a partnership with a large family tannery in Argentina, he said.
Meanwhile, some Chinese tanneries have gone out of business rather than meet stricter government environmental standards. A death sentence is now a possibility for some of the worse polluters.
‘Adding to the price mix is that only about 7% of leather is used in upholstery furniture compared with 70% for shoes and 13% for automotive,’ Thomas said. ‘As you see more Chinese drivers, the demand for leather is only going to get tighter.’

Source: Winston-Salem Journal

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