Bangladesh leather faces troubles amid suspended orders and outstanding debts

Bangladesh leather faces troubles amid suspended orders and outstanding debts

Dealing with suspended orders and outstanding debts. That is why Bangladesh leather tanning industry is in serious trouble. Since markets are stuck, several companies are stockpiling raw hides and skins in their warehouses. Furthermore, because of missed sales local entrepreneurs cannot manage to settle accounts with banks. Such short circuit might heavily jeopardize a relevant part of the national leather industry.

Bangladesh leather faces troubles

While speaking to thedailystar.net, Shad Ahmed, president of the Bangladesh Tanners Association (BTA), illustrated the current difficulties of the trade industry. For the records, such crisis began one year ago: at that time, several retailers had to dump thousands of hides and skins because they could not sell them at a convenient price.

Over those days, tanneries were not able to pay off wholesalers, who could not settle accounts, in turn, with their own suppliers. “Yet the situation might even go worse now”, pointed out Ahmed while talking to the Bangladesh daily newspaper. The association of tanners asked the government to allocate a 63-million-euro fund, in support of domestic tanneries, alongside the annulment of due interests on loans formerly granted by banks in favour of business companies.

Orders collapse

Ahmed emphasized that Spain, Italy, Hong Kong and South Korea are the four most important end markets for Bangladesh leather. In fact, the four countries account for 60% of exports: in the last few months, their orders slumped by 40%. Simultaneously, China’s demand has been running steadily, though offering prices are much lower. Many tanners are therefore trading there their own hides: selling price is even 40% lower.

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