OUTCOME OF THE HONG KONG APLF

OUTCOME OF THE HONG KONG APLF

V. M. KHALEELUR RAHMAN

The Asia Pacific Leather Fair held from 28 March to 2 April 2009 was the 25th anniversary fair with more participants. It had the usual extravaganza and hectic activities such as get-togethers, seminars, buyer-seller meets etc. but dealings were generally lacklustre and far below expectations.

We are aware that a fair is an important meeting place where products are displayed for perusal and evaluation by potential customers. It may or may not lead to any contract on the spot but it definitely paves the way for future dealings. Nobody can go to a fair with high expectations of buying or selling – an industrialist explained to me thus when questioned about the fair.

The fair authority issued a press release which said that “the hide market crash is the ripple effect of the global economic crisis plummeting sales in the automobile and household furniture sectors, both big leather consumers, have caused a radical decline in demand for skins. A similar trend followed in other leather articles like apparel, small leather goods and footwear”.

The result was that “a chronic surplus of hides, triggering a host of other problems including the dwindling value of raw materials as well as financial and contractual changes” according to the said authority.

It is also learnt from reliable sources that more than 100 containers of hides and skins were in Hong Kong and other Far East ports unsold. Suppliers had tough time in trying to dispose off them. Raw and wetblue cow hides which were sold as hot cakes before the global meltdown are having restricted activity now at the reduction of about 20 to 25%.

FMM&T FAIR, INDIA EXPO CENTRE, GREATER NOIDA, MAY 8 TO 10, 2009

The APLF, in association with Indian Footwear Components Manufacturers Association (IFCOMA) is organising the first edition of Footwear Materials Manufacturing & Technology Fair (FMM&T Fair) at the Indian Trade Expo in Greater Noida from 8th to 10th May, 2009. The organisers are of the opinion that the new fair will create a platform for Indian as well as foreign manufacturers to keep abreast of the latest trends and a bridge between the footwear manufacturers and the component producers targeting this vast Indian footwear market according to Council for Leather Exports sources.

STEADY GROWTH OF INDIAN LEATHER INDUSTRY –FIGURES SPEAK

The leather and leather products industry occupies a prominent place in the Indian economy holding 8th rank in view of its steady growth, huge employment generation, invaluable foreign exchange earnings to the tune of US$3477.52 million in the year 2007/2008. If it had received the timely support from the government and made the prices competitive in comparison with those of Pakistan, Bangladesh and China, its position would have been still better. The leather industry is evergreen and growth oriented and the present slowdown is nothing to do with it – according to all sources. The export figure for the last financial year is not available now but leading industrialists say that it will be more than that of the previous year.

The following figures show that exports of leather and leather products had been increasing constantly from 2003/2004 to 2007/2008.

EXPORT PERFORMANCE FOR FIVE YEARS

India’s export of leather and leather products for five years - Value in Million US$

2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
Finished leather
555.71
607.73
636.27
724.00
766.93
Footwear
767.73
910.77
1045.24
1236.91
1475.83
Leather Garments
301.08
329.44
333.30
309.91
343.99
Leather Goods
539.21
585.72
660.17
706.28
784.95
Saddlery and Harness
52.71
61.71
77.52
82.33
105.81
Total
2216.49
2495.37
2752.50
3059.43
3477.52
Source: DGCI&S

Quality consciousness, price control, reliability, safety etc. are some of the main features for customers being attracted to India. The industrial climate prevailing here is perhaps one of the best in the world. There are innumerable industrialists in India having uninterrupted business connections with their overseas customers for decades together.

The following table shows country-wise performance of major importing countries of Indian leather and leather products for five years (Value in million US$)

COUNTRY

2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
Germany
329.82
350.79
363.24
410.08
488.72
Italy
285.02
258.23
317.04
413.35
479.04
UK
250.65
313.69
345.54
359.84
414.32
USA
251.58
290.42
318.36
317.59
306.69
Hong Kong
226.97
247.68
252.15
279.72
267.93
Spain
161.23
176.70
200.18
185.78
212.07
France
109.82
140.00
143.72
174.04
196.17
Netherlands
57.75
65.68
82.95
100.82
133.37
UAE
37.39
48.03
52.34
62.55
74.53
Portugal
34.07
38.38
42.20
49.92
56.06
Source: DGCI&S
However the present situation in Tamil Nadu and elsewhere in the country is that industrialists are operating cautiously as market is dull for leathers even at reduced prices whereas although there is demand for leather products particularly footwear, prices are comparatively lower which are considered highly unworkable. This is worrying the trade and industry.

NEW PLANNING

The present slowdown has made some industrialists to think of having some sort of collaboration with leading importers abroad for production and marketing of their products or marketing them in domestic and overseas markets with their own brands. (V.M. Khaleelur Rahman in Indian Leather, May 2009)
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