LEATHER MARKET IN A DILEMMA

                                LEATHER MARKET IN A DILEMMA

                                          V.M. Khaleelur Rahman

Leather market in India as well as overseas is passing through a difficult period. Tanners and manufacturers of leather products are in a dilemma not knowing how to fulfill their contracts as raw materials are not only in short supply but their prices are also ruling high beyond ones imagination. There is heavy competition for all sorts of raw hides and skins among tanners and exporters in all centres in the country. Even imports of these items are difficult due to internal problems in some Arab countries and weakening Indian Rupee.

It is reliably learnt that there are delays in shipments and claims on delayed shipments and consequently banks are reluctant to negotiate export bills and release payments. There is also a widespread grapevine of two or three big shoe units in North India going bankrupt. This may or may not be true but the reality is that many units are trying their best for survival due to the present unprecedented difficult market situation. Some of the small job units which depended on big factories have already been closed and some others are in the state of closure if they are not able to get support.

Asked about the present situation, a tanner pointed out that “the big exhibitions, frequent foreign trips, and even increased export etc. are of course the necessities of the present day and not necessarily the signs of profitable business. There is an urgent need for more government support for survival of the industry”.

Arrivals of tanned goat skins continue to be limited and are sold like hot cakes. Prices are almost unchanged in higher selections and slightly lower in lower selections. All  Suedes (up to Rejection) are sold at around Rs.54 per sq. ft. whereas A/B/C linings are fetching at around Rs.42/40/38 per sq. ft. Grain selections R/V/IF combined are sold at around Rs.60 per sq. ft. Rejection and Langda are also in good demand and sold at different prices depending on the quality and selection.

As far as export business is concerned, there is resistance by customers. Contract is not easy at the present unchanged prices. There is no report of any big business in the market. It is said that some patchy business has taken place here and there with customers in Hong Kong, Singapore, Taiwan etc.

Quotations of exporters are at around the following lines:

                            S/C OR F/C GOAT LEATHERS

Material	Size/sq. ft.	Substance	Selection	Price US$ per sq. ft. C&F
Goat upper leather	3/5 or 4/7	0.6/0.8 mm	ABC	2.50
Goat milled leather	4/7	0.6/0.8 mm	E	2.00
Goat suede leather	3/5 or 4/7	0.6/0.8 mm	ABC/D/E	2.30/1.80/1.60
Goat lining leather	4/7	0.5/0.7 mm	TR-1/2/3	1.60/1.50/1.40
	6/9	0.6/0.8 mm	TR-1/2/3	1.65/1.55/1.45
Goat lining leather lot	3/9	0.5 up mm	Stock lot	1.20

                                                                   

 (VMK in Indian Leather, July 2012)