V. M. KHALEELUR RAHMAN
The reports available in the world press indicate that the global recovery of the economy is slow as a whole. While it is flat in Europe, it is better in Asia and South America but Chinese economy is growing well with its increasing imports and exports. The World Leather Business Week reported in March 2010 that "leather demand has not just recovered but the cheap raw material prices have also invited non-regular producers to re-enter or expand their productions in view of the attractive profit margins that have been obtainable in leather production in particular in China. This inflated demand and consumption of raw materials has added to the problem of shrinking supply." This seems to be the accurate assessment of the present scenario in the market. However just in about one month's time the prices of raw hides and skins have gone up considerably and even their availability is limited. One wonders if the leather market is also like the glamorous share market where there are more losers and few gainers despite expert consultations.
“AISHTMA” DELEGATION TO SYRIA AND IRAN
The Chennai based All India Skin & Hide Tanners and Merchants Association (AISHTMA) President Mr. M. Rafeeque Ahmed has sent a circular saying that they are planning “to visit Syria and then Iran on a later date also enabling the delegates to visit the 3rd Iranian Leather Exhibition during 25-29 May 2010.” The delegation of the interested members of the Association will leave Chennai on 19th May and return on 27th May 2010. The purpose of the visit is to find possibilities for importing the kind of raw hides and skins, which are in short supply here, to fulfill export targets apart from attending the above mentioned leather show.
EXPORT PERFORMANCE DURING APRIL 2009 TO FEBRUARY 2010
(Courtesy: Council for Leather Exports)
It is clear from the above data that there is a decline of 11.84% in the total exports of leather and leather products in US dollar values during the 11 months (April 2009 to February 2010) in comparison with the same period in the previous 11 months (April 2008 to February 2009)
Tanners who are in the leather industry since long believe that the strict “norms for identification of finished leather” is the main cause for decline of finished leather exports to the extent of 16.78%. They have been saying that tanners are not willing to do finished leather for export as they do not know what will happen to them at the time of export at the customs. The present situation in every field is for the powerful and daredevils. Innocent people cannot thrive in any field particularly in the leather industry as it is becoming more and more risky, tricky and unethical. Many tanners and exporters have even deserted the trade unable to face the current tendencies and challenges. It is rather very difficult if not impossible to survive in the trade for the small exporters who are voiceless and silent spectators to the goings on in the trade and industry.
E.I. TANNED HIDES AND SKINS
Some tanners lament: All the countries in the world allow export of even raw hides and skins, our government allows their imports without any restriction whatsoever but surprisingly despite repeated requests the age old Tamil Nadu speciality tanned hides and skins which are in good demand abroad are not considered at par with finished leather for export. They think that there is no strong lobby to represent this matter to the government.
SHOE INDUSTRY ON BETTER FOOTING
Generally speaking it is the shoe manufacturers who are running the show somewhat better in comparison with others despite global recession, declining exchange rates, increasing prices of raw hides and skins, chemicals etc. and giving employment opportunities to thousands of people, men and women, who mainly belong to the schedule caste, schedule tribe and backward communities, particularly in places like Chennai, Ambur, Ranipet etc. even though they are also handicapped by and large in not getting the required incentives from the government to face the unprecedented situation in the present lacklustre export market.
In spite of all best efforts by exporters, there is a decrease of 10.04% in the export of Leather Footwear and 18.87% in the export of Footwear Components. Exports of other items such as Leather Goods, Saddlery and Harness and Non Leather Footwear have also gone down 15.24, 14.63 and 4.93 per cent respectively. The only item which has shown a meagre increase of 1.65% is Leather Garments.
GENERAL IMPRESSION
The general impression in the market is that there is good demand for goat suedes, sheep nappa is also on the move and so is the case with cow hides in some select grades and marks. Indian exporters are not able to compete with their counterparts in Bangladesh and Pakistan who are getting not only more exchange rates but also more incentives for exports.
FAVOURABLE CHANGES NEEDED
One feels that changes in export and import policies, relaxation in export norms for finished leather, increase in drawback and other incentives are the urgent need of the time to make the leather industry grow and increase its exports in the highly competitive world market.
(Indian Leather, Chennai)
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