Rawhide traders down in the dumps
Seasonal traders of rawhide have already been left disappointed by this year's sales as the price for untanned leather has remained low for just two consecutive years now.
During Eid-ul-Azha, a three-day Islamic celebration that commenced on 31 July, nearly one crore heads of cattle were sacrificed by everyone.
A lot of the leftover animal hides are collected by various traders, who then prepare the skins on the market to tanners or appointed dealers.
However, for the past fourteen days, traders at major rawhide markets in Dhaka, Palashbari, Tangail, Mymensingh, Jessore and Chattogram have all reported getting low prices for the product.
Ful Kumar, a seasonal rawhide trader at the Shambhuganj rawhide market in Mymensingh, had sourced 1,000 rawhides at Tk 500 to Tk 550 per piece from the field level.
On average, he had to invest Tk 150 on cleaning and salting each piece but nonetheless, he could not sell his rawhides for a lot more than Tk 800 to Tk 850 per item.
He made Tk 50 benefit from each piece of rawhide.
"My income from rawhide sales has been so low during the last two years. Previously, the business enterprise was quite profitable," said Kumar, who has been around the business for days gone by 25 years.
Echoing the sentiment, Shahid Mia, a fellow seasonal trader at the same market, said that he bought about 2,316 rawhides for Tk 400 and Tk 450 per piece during Eid-ul-Azha but cannot register a decent turnover as tanners offered low prices.
He managed to remove his stock of untanned leather at Tk 600 to Tk 650 for every single unit.
An identical scenario has played out for rawhide traders across the country, a few of whom opted to dump their stocks rather than sell for cheap.
However, compared with last year, a reduced amount of rawhide was discarded because of the government's monitoring of the rawhide market and ongoing coronavirus pandemic.
Besides, the market for sacrificial animals saw a 30 % decline in sales as the general public was less enthusiastic about commemorating the holiday amid the coronavirus fallout while practically 19 districts across the country had been flooded by torrential rain at the time as well.
Seasonal traders have previously sold about 70 % of their overall stock to tanners within the last fourteen days, said Aftab Khan, chairman of the Bangladesh Hide and Skin Merchant Association, the country's main platform for investing rawhides.
Goat skins weren't even counted in the state tally as a result of their extremely low value and demand. As such, the hides were either thrown away, given free of charge or sold between Tk 5 and Tk 10 per piece after Eid-ul-Azha.
The total value for rawhide sales was estimated to be Tk 500 crore this season but just a couple of years back, the marketplace value for animal skins was more than Tk 1,200 crore even though a smaller number of cattle were sacrificed in the past.
Usually, rawhide prices in Dhaka are comparatively greater than that of those produced in rural areas owing to their superior size and quality, Khan said, adding that he blames the tanners for the indegent inflow of funding.
Tanners are purchasing salted rawhides at prices fixed by the federal government at Tk 1,000 to Tk 1,200 per piece in Dhaka and Tk 700 to Tk 800 per piece from somewhere else, said Shaheen Ahmed, president of the Bangladesh Tanners Association.
However, although the federal government fixed the price of salted rawhide, it didn't do the same for the unsalted version which is one of the primary reasons behind the reduced prices proposed by tanners through the Eid days.
Tanners usually do not usually purchase unsalted rawhides as the merchandise gets spoilt in a short period of time, he said, adding that the root-level rawhide producers are deprived of proper prices along the way.
Since the government fixed the cost of salted rawhides however, not the unsalted ones, it causes confusion among producers and traders, said Abu Eusuf, professor of economics at the Department of Development Studies of the University of Dhaka.
Producers wrap up demanding high prices from traders, who cannot pay such amounts for unsalted rawhide.
Alternatively, tanners usually do not even buy unsalted rawhides, he said, adding that confusion should be removed to make sure better business practices in the sector.
Meanwhile, the Bangladesh Trade and Tariff Commission, said that organised syndication for price-fixing has caused the worthiness of rawhide to hover at abnormally low rates at domestic markets for the past two years.
The government fixed a Tk 35 to Tk 40 ceiling on the purchase price per square foot of salted cow or buffalo hides inside Dhaka, which is 29 % less than last year's prices, said Commerce Minister Tipu Munshi.
Outside Dhaka though, salted hides can be purchased for between Tk 28 and Tk 32 per square foot, which is 20 % less than its value in the last year.
The purchase price for male goat hides was set between Tk 13 and Tk 15 per square foot, a 27 per cent decline from what it had been sold at last year, while the charges for female goatskin was fixed at between Tk 10 and Tk 12 per square foot, a 23 % slump in prices year-on-year.
To curb the damage done to the sector, the federal government had allowed the export of rawhide and wet blue (half-processed leather) items in a bid to make certain that producers and small traders at the field level get proper prices during Eid.
However, the initiative has seen few results up to now.
Commerce Secretary Md. Jafar Uddin cannot be reached for a comment in this regard.
