Ctg traders struggle with unsold rawhides and low offers
Tanners offering Tk12-Tk15 less than set rate
Nearly a month after Eid-ul-Adha, Chattogram's rawhide traders are struggling with the burden of almost three lakh unsold hides, facing offers significantly below the government-set price.
They collected 3,60,905 skins of sacrificial animals from across the district, expecting to sell them for Tk50 to Tk55 per square foot as set for areas outside Dhaka.
However, tanneries are currently offering them only Tk37 to Tk40 per sqft.
Besides, rawhides collected during Eid-ul-Adha typically require two months to sell, and with only 80,000 pieces (22%) sold thus far, traders fear potential losses amid rising costs for salting, wages, and storage.
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They said the situation is similar in other parts of the country. Hide traders outside Dhaka struggled to sell more than 50% of their leather and faced low prices.
Muslim Uddin, president of the Chattogram Rawhide Traders' Association, told The Business Standard that tannery owners are not meeting their expectations.
Even those who are buying are offering Tk12-Tk15 less per sqft than the government-set rate. Selling leather at these lower prices makes it hard to cover costs, he added.
He expressed concern that many businessmen have taken loans to invest in rawhides, and without fair prices, everyone stands to lose.
A trader in the port city explained that each cow's hide averages 20-22 sqft, purchased for around Tk400. Adding the costs of salting, wages, and storage—amounting to Tk450-Tk500—it becomes unsustainable to sell them at Tk900-Tk1,000 to tanners.
While Dhaka traders receive fair prices, those outside Dhaka face lower prices.
Abul Kalam Azad, the association's general secretary, said Chattogram once had numerous tanneries, but now only one remains.
"This has left merchants reliant on Dhaka's tanneries, which are offering lower prices for leather as a consequence," he added.
According to the Chattogram Rawhide Wholesalers Cooperative, there were once 112 registered wholesale rawhide traders under the association. Additionally, 70 to 80 wholesalers traditionally purchased rawhides.
However, currently, only 25-30 traders remain operational.
Mokhlesur Rahman, director at Reef Leather, Chattogram's sole tannery, said they have purchased around 50,000 pieces of rawhide from various regions, with plans to gradually acquire 50,000 more.
Responding to concerns about tanneries not meeting government-set prices, Rahman stated they can not purchase rawhides at prices that would put them in loss.
"We buy based on prevailing market rates, considering hide quality," he added.
Omar Hajjaj, president of the Chittagong Chamber of Commerce and Industry, told TBS that one reason for lower leather prices is the challenge in maintaining leather quality.
"This affects traders' ability to fetch desired prices," said Hajjaj, suggesting that increasing technological adoption in the leather sector could mitigate financial losses.
According to a report by Bangladesh Small and Cottage Industry Corporation (BSIC) titled "Current Status of Leather Industry in Bangladesh, Challenges, and Ways Forward," sacrificial animal skin prices have remained low for a decade.
The report identified seven reasons contributing to sustained low prices, including oversupply, rising salt prices, transportation costs, reduced buyer numbers, liquidity issues among traders, tannery and market syndicates, and inadequate payment by tannery owners.
Tipu Sultan, secretary general of Bangladesh Hide and Skin Merchants Association, noted that while Dhaka traders receive fair prices, those outside Dhaka face lower prices.
Oversupply and syndicate of tannery owners also play a major role for lower prices, he added.
