During the first two days of Eid-ul-Azha, Madrasa E Baitul Mamur, an Islamic seminary in Mirpur, Dhaka, collected 450 pieces of rawhide from the local community and sold them to rawhide traders at an average price of Tk 850.
According to Mufti Nurul Isalm Showaibi, the head of the hostel at the madrasah, the average price per piece of rawhide has increased by Tk 100 to Tk 150 compared to last year, when buyers paid around Tk 700 to Tk 750 per piece.
Mamun and Brothers, a rawhide trading house at Posta, the largest cattle skin market in Dhaka, has already purchased thousands of rawhide during the three-day Eid period. They are currently mixing salt for preservation purposes.
Hazi Mohammad Zakir Hossain, the purchase in-charge at the firm, mentioned that they purchased rawhide at Tk 28 to Tk 31 per square foot based on quality and size. Additionally, they had to spend Tk 18 for preservation, labour, and transportation. The company offered prices ranging from Tk 550 to Tk 1,100 for rawhide measuring 20 to 25 square feet and increased the price per piece by at least Tk 100 compared to the previous year.
Despite unfavourable weather conditions, low export earnings, and high salt prices, the prices of sacrificial rawhide have experienced a partial increase during this Eid-ul-Azha. However, there is a demand crisis for he-goat rawhide and head skin, leading to their disposal in landfills. Thanks to the price hike, seasonal and permanent traders are in a cheerful mood after a long time.
Tanners ready to purchase rawhide
The rawhide business operates in three steps. The seasonal traders collect rawhide of sacrificial animals from commoners madrasahs, and charitable organisations and then sell to permanent traders. The permanent traders preserve the rawhide by applying salt and subsequently sell it to tannery owners. During the Eid season, tanners also collect unsalted rawhide to maximise their profits.
Every year, the government sets a fixed price for salted rawhide, but the price for unsalted rawhide is determined through negotiations with seasonal and permanent traders. On June 24, the government increased the prices of salted cow rawhides by 6 per cent to Tk 50-55 per square foot in Dhaka, but no price was set for unsalted rawhide.
In the three days of Eid-ul-Azha, tanners have collected nearly six lakh pieces of salted rawhide from traders, paying government-fixed prices this year. Tannery owners and rawhide traders suggest that if the government could control salt prices, they would be able to offer higher prices to seasonal traders.
Md Ashikur Rahman, the managing director of Tajin Leather Corporation, said they have already collected 20,000 pieces of rawhide, most of which are without salt, and he is offering at least Tk 150 more per piece compared to the previous year. He expressed satisfaction with the better flow of rawhide compared to the previous year, although concerns remain regarding the quality of rawhide due to the Lumpy Skin Disease.
Tanners are concerned about the significant power cuts and low gas pressure they experience daily, which has forced them to halt production during working hours in the last month. If the situation persists, it could pose a disaster for the industry.
He-goat skin discarded again
The demand for goat rawhide has significantly declined, leading to the discarding of a large quantity of goat rawhide in landfills this year, similar to previous years. Tanners and rawhide traders attribute this to the increased processing costs. Zakir from Mamun and Brothers stated that they can hardly sell salted goat rawhide for Tk 50, while the processing cost amounts to Tk 40 to Tk 45. Consequently, they are not interested in purchasing goat rawhide.
Additionally, head skin and other byproducts of cows are also being dumped in landfills due to a shortage in demand, despite being valuable items in the past. Previously, dozens of factories used to process these byproducts, generating revenue of over Tk 1,000 crore annually. However, the Bangladesh Small and Cottage Industries Corporation (BSCIC) has failed to allocate plots to entrepreneurs in Savar Tannery State after their relocation from Hazaribagh, resulting in the waste of these valuable items, according to Ashikur of Tajin Leather.
Tanners facing challenges
While Bangladesh considers leather and leather products as emerging export items, tanners have been facing challenges since 2017 when the government ordered the relocation of tanneries from Dhaka's Hazaribagh area to the tannery industrial estate in Savar following a High Court order, discontinuing all facilities in Hazaribagh.
However, significant progress in the relocation process has not been achieved even after six years, and solid waste continues to be dumped in nearby open spaces. Compliance issues and the requirement of LWG certification for exporting leather and leather products to the Western market have yet to be fully addressed.
Consequently, the leather sector in Bangladesh continues to struggle, and the country is compelled to export major finished leather to China, Vietnam, and Thailand at below-fair prices. Out of 222 tanneries, the BSCIC has allocated plots to only 154 tanneries at the BSCIC Leather Industrial Park in Savar. Although the BSCIC established a central effluent treatment plant (CETP), its capacity is insufficient to treat the entire waste generated during the Eid season. As a result, tanners have to use the CETP judiciously, causing production stoppages for at least two days a week.
Md Shaheen Ahamed, chairman of the Bangladesh Tanners Association, said that only two tanneries in the country have LWG certification, leading to reputed brands not purchasing leather from Bangladesh. He emphasised that obtaining LWG certification for at least 20 factories would create brand value and attract buyers, ultimately increasing rawhide prices.
