Domestic demand for finished leather goes up
Saturday, 25 July 2009
Jasim Uddin Haroon
The demand for finished leather has surged in the domestic market in recent months, which is in contrast to stiff fall in its shipment due to global financial crisis, industry insiders said.
The rise in demand for leather from the local footwear manufactures might be around 20 per cent in recent period ending sluggishness in the local market, they claimed.
"We have enough orders for shoes and this is the main reason behind the surge in demand for finished leather," Md Saiful Islam, chairman of Picard, a leading footwear manufacturer and exporter, told the FE.
However, industry people said relocation of a number of shoe factories in Bangladesh by China, Vietnam and Taiwan has also caused the sudden surge in demand for local leather.
Withdrawal of quota by European Union on Vietnam in 2008 and imposition of anti-dumping duty on China encouraged many leading shoe manufacturers to shift their plants to Bangladesh.
Taiwanese shoe maker Pau-Chen has already built a plant in the Chittagong Export Processing Zone and Youngone Corporation is planning to set up a plant at a cost of US$ 110 million there. This plant is supposed to be one of the biggest shoe plants in the world.
However, local footwear manufacturers alleged that they had been facing shortage of quality leather in the domestic market.
"There is now scarcity of quality finished leather as only a small number of tanneries produce quality finished leather," said a footwear maker.
Bangladesh procures around 200 million square metres of leather per annum, of them the country's 52 shoe manufacturers consume around 60 million metres a year.
Sources at the Bangladesh Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh said the local shoe producers have consumed more than 75 million square feet over the past one year.
An official at the Jenny's, a shoe maker, told the FE, his company is getting increased orders from different reputed companies mainly because of the existing GSP (generalised system of preference ) facilities in EU market.
"We recently tied with Fatface, a leading UK company, for supply of shoes," said Mazharul, a general manager of the Jenny Shoes.
"Our products are good and competitive in prices," he added.
An official at Riss Leather, a tannery, said his factory is failing to meet the demand for finished leather.
However, local shoe manufacturers earned $169.77 million during July-May period of the last fiscal. This is a 16.50 per cent higher than that of the previous financial year.
Export of leather dropped by 37.51 per cent to $163.51 million during the first eleven months of the just ended fiscal year.
The demand for finished leather has surged in the domestic market in recent months, which is in contrast to stiff fall in its shipment due to global financial crisis, industry insiders said.
The rise in demand for leather from the local footwear manufactures might be around 20 per cent in recent period ending sluggishness in the local market, they claimed.
"We have enough orders for shoes and this is the main reason behind the surge in demand for finished leather," Md Saiful Islam, chairman of Picard, a leading footwear manufacturer and exporter, told the FE.
However, industry people said relocation of a number of shoe factories in Bangladesh by China, Vietnam and Taiwan has also caused the sudden surge in demand for local leather.
Withdrawal of quota by European Union on Vietnam in 2008 and imposition of anti-dumping duty on China encouraged many leading shoe manufacturers to shift their plants to Bangladesh.
Taiwanese shoe maker Pau-Chen has already built a plant in the Chittagong Export Processing Zone and Youngone Corporation is planning to set up a plant at a cost of US$ 110 million there. This plant is supposed to be one of the biggest shoe plants in the world.
However, local footwear manufacturers alleged that they had been facing shortage of quality leather in the domestic market.
"There is now scarcity of quality finished leather as only a small number of tanneries produce quality finished leather," said a footwear maker.
Bangladesh procures around 200 million square metres of leather per annum, of them the country's 52 shoe manufacturers consume around 60 million metres a year.
Sources at the Bangladesh Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh said the local shoe producers have consumed more than 75 million square feet over the past one year.
An official at the Jenny's, a shoe maker, told the FE, his company is getting increased orders from different reputed companies mainly because of the existing GSP (generalised system of preference ) facilities in EU market.
"We recently tied with Fatface, a leading UK company, for supply of shoes," said Mazharul, a general manager of the Jenny Shoes.
"Our products are good and competitive in prices," he added.
An official at Riss Leather, a tannery, said his factory is failing to meet the demand for finished leather.
However, local shoe manufacturers earned $169.77 million during July-May period of the last fiscal. This is a 16.50 per cent higher than that of the previous financial year.
Export of leather dropped by 37.51 per cent to $163.51 million during the first eleven months of the just ended fiscal year.