Africa
Leather and Leather Products Institute
(ALLPI)

Member of: IULTCS    International Council of Tanners    

Leather for Health, Wealth and Luxury

Leather Related News Flash for the week (August 5 to 12, 2013)

Part I: General News
WORLD SHOE PRODUCTION
A new report by IBIS World says global footwear production advanced by an average of 4.2% in the period 2008-2013 to reach a value of 113.6 billion USD. During this period the US and Europe lost some of their importance but emerging countries put the total up.

For the coming five years the figures should improve since the economies of the US and Europe are expected to come out of their recessions while the emerging countries will grow further.

The biggest footwear companies in the world today are all in Asia:
Yue Yuen International Holdings Ltd.
Belle International Holdings Ltd.
Li Ning Company Ltd.
Feng Tay Enterprises.
United States 
Footwear maker Skechers has started to refund 40 million USD to the victims of the deceptive advertisements about the health advantages of its toning shoes (as court decided). The number of cheques that will be sent out to consumers is 509,175
Brazil
The performance of the Brazilian leather sector during the first six months of 2013 resulted in a surplus of US$ 1.18 billion. The numbers indicate that the Brazilian leather exports was determinant to prevent a more negative result in the national trade balance from January to June this year (US$ 3 bi deficit).
Considering only June 2013, sales to the external market reached US$ 197.891 million, a high of 9.4% in relation to the same period last year, according to presented data by the Foreign Trade Secretariat (Secex), with analysis of the Centre for the Brazilian Tanning Industries (CICB).
Considering the current scenario, the president executive of the CICB, José Fernando Bello, evaluates that along the coming months the leather industry has to act with caution. According to him, it has to be considered, the continuing problems in the global economic sphere, such as the issues faced by the euro zone, and the growing concern with the slowdown of the Chinese economy, among other difficulties for the expansion of international trade.
The main destination of Brazilian hides between January to June 2013 were: China / Hong Kong with 35.0 %, Italy with 23.1 %, and the United States with 10.1% (monetary participation).
A matter relating to the Brazilian exclusion in the European Union Generalised Scheme of Preferences (SGP) planned to January of next year is also a concern. "This implies in the increase of rates on Brazilian exports of hides to Europe in the order of 3,5 %, consequently risking the leather exports to the EU", Bello adds. Currently about 35% of Brazilian hide exports are destined to the European continent. The executive emphasises that CICB is articulating bilateral agreements to lessen this issue.
Ethiopia
Ethiopia’s leather industry generated more than USD 120 million in the last fiscal year. Finished leather accounted for the overwhelming majority of this (82 percent), with gloves (16 percent) and other leather products (2 percent) making up the remainder.
Compared with last year, leather exports went up by 11.4 percent, or USD 12.4 million.
Ethiopia makes and exports a large range of leather goods, including shoe uppers, garments, stitched upholstery, backpacks, purses, industrial gloves and finished leather. Ethiopia made USD 51 million from the export of finished skin and hide. This year the figure has almost doubled, having increased to more than USD 100 million. Shoe exports also rose in value, by 91 percent, topping USD 19 million. The export value of gloves and other leather products more than doubled, rising from USD 1.5 million to more than USD 3 million.
 

Rwanda
The 16th International Trade Fair 

Prime Minster, Dr. Pierre Damien Habumuremyi opening the 16th International Trade Fair at Gikondo Expo Ground
Prime Minster, Dr. Pierre Damien Habumuremyi opening the 16th International Trade Fair at Gikondo Expo Ground
The 16th International Trade Fair was opened by His Excellency Dr. Pierre Damien Habumuremyi, Prime Minister of Rwanda, on 25th July 2013 at Gikondo Expo Ground. The Prime Minster in his opening speech said that the 2013 International Trade Fair is a good opportunity for local manufacturers to learn from other countries and improve their products in order to be more competitive. He reiterated that the COMESA manufacturing sector shall be promoted through linking business to the COMESA market of 440 million consumers.
The theme of this 16th International trade fair is "linking businesses to markets; promoting the manufacturing sector in the COMESA region".
Over 21 countries from Africa, Asia and middle east participated in this  trade fair; COMESA-LLPI  sponsored (partially) the participation of 8 companies drawn from Ethiopia, Kenya and Uganda.
The 1st  COMESA Manufacturers Regional Dialogue, organized by the COMESA Business Council, was also held in Kigali-Rwanda for 2 days prior to the opening of the Fair. Experts, Manufacturers’ Associations and Manufacturers from the COMESA Region and representatives on International Partner Organizations participated in the two days Dialogue.
The theme of the dialogue was "Linking businesses to markets; Unlocking the potential of  the manufacturing sector in the COMESA Region". More than 10 discussion papers were presented and panel discussions and adoption of recommendation were made.
COMESA/Leather and Leather Products Institute was represented by two of its Experts, Mr Nicholas Mudungwe, Cluster Expert, and Dr. Mekonnen Hailemariam, Leather Value Chain Expert. Mr Nicholas Mudungwe presented a paper entitled “Unleashing the Potential of the COMESA Leather Value Chain: the Cluster Approach.
Leather excellence centre  opened in Chennai
Clariant, a world leader in specialty chemicals  said it has opened a new leather excellence centre, in Ranipet, Chennai.  "We are committed to the long term development of our services and products for India's leather sector. We see the country's leather related businesses growing and we expect to see above average growth for our products and services.  "We are looking for double-digit growth of the business in India," Clariant's global leather business Unit Head Oliver Kinkel said in a statement issued.  Clariant already has major production sites at Kanchipuram, Tamil Nadu and Roha, Maharashtra.
COTANCE calls for volunteers to determine leather’s carbon footprint
COTANCE, the European Leather Industry Association, is to submit an application to set up a pilot initiative to determine the environmental footprint of leather. If successful the pilot initiative will win funding from the European Union. However, the application has to be submitted soon and COTANCE has asked for tanners to become involved by sending letters of support by July 24, 2013.


At the core of its application is COTANCE’s conviction that the start of the lifecycle of leather is in the slaughterhouse, where hides and skins are recovered as a by-product of the meat industry. “There should be no carry-over of any environmental burden from livestock breeding to the leather industry,” the organisation insists.

General secretary of COTANCE, Gustavo González-Quijano, said on announcing the development: “This is a unique opportunity for the global leather industry to get fair Product Category Rules (PCR) that recognise the system boundaries that the UNIDO leather and leather products panel overwhelmingly endorsed last autumn in Shanghai for our sector. In this context the leather industry is challenging conventional thinking. Only through a united industry position will we succeed.”


More broadly, the European Commission wants to test the scale of the environmental footprinting of products across the EU and has agreed to fund a number of pilot initiatives to do this. It has invited companies and organisations responsible for various product categories to volunteer to take part; COTANCE wants the leather industry to be one of the sectors to volunteer.


This could lead to an official framework for “hammering out” the sector’s Product Category Rules, Mr González Quijano said, adding that the framework would have global reach. He said an official framework in the European Union could be “an important parameter” and “a trendsetter” for the global leather industry.

He called on other leather industry bodies around the world and “like-minded stakeholders” everywhere to send letters of support for COTANCE to present with its application, saying: “The more international and inter-sector support COTANCE can show at the time of application the more influential leather can become in the process. This is a win-win exercise where the leather industry is the real winner.

COTANCE has drawn up a template for a letter of support and has asked companies and organisations all over the world to respond quickly, putting their details into the template, creating their own document on their own headed notepaper and sending it back to COTANCE for submission to the EU.

Organisations or individuals who believe that they can play a part in helping COTANCE develop environmental Product Category Rules for leather by being part of the technical secretariat the organisation wants to set up, can express this extra support in their letters.

Source: http://www.leatherbiz.com/fullitem2.aspx?id=130491



Part II: Some Indicative Prices of Leather and Leather Products

Product name

Grade

USD/sqft fob/ori/c/off

Ethiopia

 

 

full aniline

i-iii

2.60-3.00

iv

1.95-2.60

v

1.70-1.95

Semi aniline and golf leather

i-iii

2.10-2.70

iv

1.75-2.05

v

1.45-1.75

Resin lining

A

1.25-1.50

 

B

0.95-1.20

Fully finished Cow upper leather

TR (i/iv)

1.05-1.50

 

v

0.80-1.05

aniline lining

A

0.90-1.15

 

B

0.70-0.90

Kenya/Uganda

 

 

Suspension dried hides

Weight/pce 8/12  lb

2.80 nominal

 

iv grade

2.20  nominal

 

v grade

1.75  nominal

Wetsalted hides (Kenya)

 

 

 

i/ii

1.65

Wetblue hides

 

 

Sqft/pce =av 23/27

tr/iv/v/vi

1.00-1.10

av 31/33

tr/iv/v

1.10

av 20/26

vi

0.70

 

vii or rejects

0.55

Sqft/dzn

t/r iv/v

68.00

55/60

vi

36.00

vii

21.00

tr/iv/v

70.00

Wetblue goats

 

USD/dzn fob/ori/c/off

sqft/dzn 55/60

tr/iv/v

70.00

sqft/dzn 70/75

 

75.00

sqft/dzn 55/60

vi

38.00

sqft/dzn 40/50

vii

22.00

 

 

 

Malawi

 

USD/kg cfr/ori/c/off

Kg/pce, 14/16

i/ii

1.65-1.68 cfr/ori/c

Suspension dried goatskins  Lb/100 pcs, 90/100

i/iii

42.00 cfr/ori/c/off

Drysalted hides kg/pce, 9/+ av 10/11

a/b

1.85

Sudan

 

 

Drysalted hides,  kg/pce,  av 10/11

 

USD/kg cfr/ori/c/off

 

a/b

1.85

Zambia
Kg/pce in wetblue (pressed)

 

USD/pce cif/t/c/off

10

 

29.50

 15

 

43.50

19

 

53.50

27

 

63.50

 

 Madagascar

 

Wetsalted cattle hides

Zebu type

Kg/pce

Flay

selection

previous price

USD/kg cfr/ori/c

 

9/11

 

70/30 i/ii

 

nq

 

13/15

good h/f

70/30 i/ii

 

nq

 

18/22

h/f

80/20 i/ii

 

nq

 

21/24

   

1.27-1.32

1.23-1.25

 


 
Source: Compiled from Sauer Report and other sources
Abbreviations
a/b/c; Private quality indication by supplier; 'a' is not necessarily 1st grade, etc
Av: Average
c: cash payment
cif: Cost, Insurance & Freight
fob: Free On Board
off: Offered
ori: Price payable to supplier in country of origin of the goods
pce : Piece
sqft: Square Feet
t: Price Payable to Traders outside the country of origin of the goods

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Africa Leather and Leather Products Institute (ALLPI)
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Addis Ababa, Ethiopia.