Dip in export order, mismanagement hit rawhide business hard
35-40 percent less rawhides was collected this year compared to the last year as they suffered losses last year as the demand for the rawhide was low
Apex Tannery, the largest rawhide processing company in the country, had 15 lakh rawhides in stock before Eid-ul-Azha. The company with a capacity to stock 30 lakh rawhides did not set any target to buy new rawhides during this Eid as there was no demand from the buyers this year.
Executive Director of Apex (Operation) AMA Mazed said they did not find it necessary to collect during Eid as the price of processed rawhide in Europe or China was low.
Almost all of the 188 tanneries registered with the Bangladesh Tanners Association (BTA) shared a similar experience.
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Owners of warehouses and tanneries said 35-40 percent less rawhides was collected this year compared to last year as in that year they suffered losses because of low demand for rawhide. Besides, owners of rawhide warehouses and tanneries could not manage any loans to buy new rawhides.
This caused a chaos in the rawhide trade all across the country and a big slump in price. Cow rawhides were sold for Tk150-600 in the capital, while the goat skins were sold for Tk2-10 depending on their sizes.
In many places including Chattogram, people buried their rawhides underground or dumped them.
Businessmen in Dhaka's Posta area, where the largest rawhide warehouses of the country are located, said they could collect cattle rawhides at much lower prices than the previous year, but they were uncertain about selling those.
Hazi Abdur Rauf, owner of Abdul Mazed Warehouse, said he bought 15,000 of rawhides this year, while he bought 25,000 pieces last year.
He also said the tannery owners owed the warehouse owners money for the rawhides they bought in the last couple of years, so the warehouse owners are suffering from cash shortage.
Meanwhile, Majakat Harun, senior vice president of BTA, said the European buyers have stopped buying from them for the last three years, so the tannery owners have to stock up to 40-50 percent of the rawhides they collect every year.
"We chose China as an alternative market but that is also closed since January this year. So the tannery owners are not buying new rawhides," he added.
69 percent warehouse owners have not bought any rawhide
The Warehouse Owners Association said 69 percent of the warehouse owners in Chattogram could not buy rawhides during Eid-ul-Azha due to a severe crisis of funds.
They said they did not get their previous dues from the tannery owners and also did not receive any loans from the banks or any other sources.
Abdul Kader, former president of the Rawhide Warehouse Owners Association in Chattogram, said there are 112 warehouse owners in Chattogram, but only 35 collected rawhides due to the fund crisis.
He said this year the warehouses collected 3.5 lakh pieces of rawhides, which were priced between Tk200 and Tk500.
According to Abdul Kader, tannery owners in Dhaka owe Tk40 crore to rawhide warehouse owners in Chattogram.
Meanwhile, seasonal rawhide traders have dumped 15,000 pieces of rawhide as they could not sell those after collecting. The Chattogram City Corporation collected those and brought those to the dumping ground. Many others buried their rawhides underground.
According to the Rawhide Warehouse Owners Association, cattle skins are collected in three stages. First, one group collects rawhides from houses, then they sell those to seasonal traders, who sell those to the warehouses.
To keep the volume of rawhides collection normal during Eid-ul-Azha, the government has taken some initiatives including arranging loans for the tannery owners, giving an opportunity to export rawhides, and monitoring the prices, but all these failed.
Despite the facility to reschedule loans to the tannery owners, no businessmen received any money till Monday.
Shakhawat Ullah, general secretary of the BTA, said, "Many businessmen have applied for the loans, but no money was disbursed."
After a ban for 31 years, the government has permitted exporting rawhides to mitigate the anarchy in the rawhide business, but no businessmen have applied to export it till Tuesday, said the Ministry of Commerce.
What the government is saying
A monitoring team, led by the commerce ministry to ensure the fair price of the sacrificed animals' rawhides, was active since before Eid-ul-Azha.
The monitoring team said some goat skins were ruined in some isolated incidents, but other than those no cow rawhide was wasted this year.
However, they acknowledged that the rawhides were bought and sold for a very low price.
Members of the monitoring team said there was a campaign among the wholesale traders, warehouse owners and seasonal businessmen about preserving their rawhides by applying salts before selling those.
So the seasonal businessmen are preserving their rawhides to sell those at a convenient time. This would prevent the wastage of the rawhides.
Another member of the monitoring team – a deputy secretary – said the seasonal traders bought the rawhides at a low price and sold them at low price to the warehouse owners, so they suffered no losses. If anyone cannot sell their preserved rawhides, the government will help him.
