Merchants started selling rawhide to tanners yesterday, a day after the FBCCI assured them of resolving their arrears of Tk 400 crore.
“We started selling rawhide to the tanners from today [yesterday]. Tanners have been buying rawhide at government-fixed rates,” said Delwar Hossain, president of Bangladesh Hide and Skin Merchants’ Association.
He said they were hoping to sell nearly 1 crore pieces of rawhide of animals which were sacrificed across the country during the Eid-ul-Azha last week.
The sales of rawhide, which would continue for the next three months, would be worth Tk 2,000 crore, Delwar told The Daily Star.
Earlier, tanners had assured that they would pay a significant portion of Tk 400 crore arrears to the merchants. Both the merchants and tanners agreed to accept the FBCCI-brokered decision in this regard.
The merchants were supposed to start selling rawhide on Saturday, five days after the Eid, but it was delayed over the arrears issue.
However, tanners and merchants estimated that some 35 lakh pieces of rawhide out of more than 1crore pieces were damaged across the country this year as some seasonal small traders and farmers threw away rawhide after failing to find buyers. They put the price of the dumped rawhide at Tk 100 crore.
However, Industries Minister Nurul Majid Mahmud Humayun claimed that only 10,000 pieces of rawhide were damaged.
Yesterday, tanners were buying rawhide of cows, bulls and buffaloes at Tk 45-50 per square foot in the capital and Tk 35-40 elsewhere as per the government’s decision.
Rawhide of castrated goats was being purchased at Tk 18-20 per square foot. For uncastrated goats, the price was at Tk 13-15.
Some 60 percent rawhide of the tanners’ total demand is collected during the Eid season as more than 1 crore animals, including bulls, goats, and sheep, are slaughtered across the country each year.
Shakawat Ullah, general secretary of Bangladesh Tanners Association, said all the tanners started buying rawhide at the government-fixed prices.
He said there was no problem in rawhide trade as both the tanners and merchants agreed to accept the decision of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), the country’s apex trade body.
Shakawat said although a good number of pieces of rawhide has been damaged this year, there would be no crisis of rawhide as more animals were sacrificed this year compared to previous years. “Our target is to buy 1 crore pieces of rawhide.”
He said there were 155 tanneries at the Savar Tannery Industrial Estate which went into operation more than two years ago.
Of them, 123 have already started production and the rest will go into operation soon, he added.
Besides, there are three tanneries outside Dhaka.
The major rawhide trading markets outside Dhaka are in Chittagong, Natore, Jashore, Mymensingh, Kishoreganj, Tangail, Dinajpur, Rangpur, Palashbari, Cumilla, Feni and Sylhet.
Ali Hossain, owner of Hazi Awlad Hossain and Sons, a rawhide merchant at the capital’s Posta, said he sold about 1,000 pieces of rawhide of cows to the tanners yesterday.
Some 15,000 pieces of rawhide were sold at the Posta market on the first day of sale, he added.
Rawhide from outside Dhaka were yet to reach Posta. Merchants from outside the capital would bring rawhide to the market within next 10 to 15 days, Hossain told this newspaper.
He said tanners, who were financially sound, were buying rawhide now.
Tanners blamed their unsold old stock of leather, shifting of tanneries from the capital’s Hazaribagh to Savar and fall in leather prices in the international markets for the problems in rawhide trade this year.
They claimed that nearly half of the tanned leather in almost all tannery units in Savar remained unsold due to lack of buyers and strict compliance conditions set by some buyers.
According to tanners, they have already invested Tk 7,000 crore in the new tannery estate and now they were facing a shortage of capital although they received Tk 2,500 from the government as financial support.