Slaughter volumes, raw material availability, tannery utilisation and downstream sell-through still follow familiar patterns in many regions, but politics remains, more than ever, a key factor when assessing conditions across the entire leather pipeline.

Two events stand out and are influencing trade, logistics, energy prices, and finance. First, on February 20, the US Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorise President Trump to impose tariffs. At first glance, this is a relief for global trade because it limits the risk of sudden, broad “emergency tariffs” and should, in principle, improve predictability for pricing and contracting. Yet it is only partially reassuring, because it does not end protectionism.

Instead of abrupt tariff waves, companies may face more reliance on alternative legal bases, export controls, sanctions regimes, procurement preferences and non-tariff barriers. For the leather industry this is very tangible, because, depending on the region, different parts of the pipeline are exposed to imports such as chemicals, auxiliaries, machinery and parts, and to exports of raw hides, wet blue, crust, finished leather and by-products. Removing one broad tariff lever may reduce immediate cost risk, but volatility remains high because uncertainty often materialises through stricter origin and declaration scrutiny, longer clearance times, more audits, disputes over HS codes and customs valuation. In short, the ruling improves legal clarity, but it does not replace the strategic need to build resilience.

The second event is far more immediate in its impact on pricing and logistics. On February 28, air strikes began against Iran, with retaliation following. In such situations the effects on global trade are clear and fast: oil prices, freight costs, insurance fees and lead times all increase. The expectation of escalation increases the geopolitical risk premium, and market attention quickly turns to energy and transport infrastructure and to potential chokepoints.

As a consequence, working-capital requirements tend to increase as companies build buffers and finance longer cash-conversion cycles, while credit conditions often become more restrictive in a higher-uncertainty environment. Finally, the demand channel matters as well: an energy-driven cost shock dampens consumption and margin-sensitive end markets—especially where leather competes intensely with alternatives and price tolerance remains fragile.

In such an environment, the debate around re-shoring, in leather production and in downstream processing, can regain importance, as companies reassess the balance between costs, availability, lead times and geopolitical exposure.

Against this political and logistical backdrop, we are leaning particularly far out of the window this time: leather is back. In many recent issues we have repeatedly reported on success in small areas, which we then, perhaps with a touch of understatement, called niches. That was not wrong, but it may have been more than that: the small seedling that eventually becomes a tree. Anyone who has listened carefully and looked closely over recent months could see a series of signals that, taken together, appear to be more than a brief flare-up. One of those signals has been a change in the public’s broader stance toward animal-based materials, leather included. In major cities, even materials that were once highly stigmatised have become visible again, initially through vintage or imitation products. This signals that the broader societal discussion around animal-based materials is moving. This is not a guarantee, but it is a catalyst that allows leather to move from defensive to more confident positioning.

We have repeatedly heard that major fashion houses are no longer hiding leather and have regained the courage to show it openly. In some collections, exotic types have reappeared, some as genuine reptile articles, others using creative embossing techniques. This was already visible and tangible at Lineapelle in Milan and was confirmed again at further fairs over the past week. The interesting part is that it does not feel like a single, top-down dictated trend, but rather a broader rediscovery of material culture, driven by a desire for durability, fatigue with sterile uniform surfaces, and a renewed appetite for products that are allowed to have character, value and performance.

Of course, some campaign groups are raging. Their protests may become more aggressive as their impact in public opinion continues to weaken. But this has nothing to do with downplaying animal welfare. On the contrary: animal welfare must be ensured for domesticated species. For wild species the protections already widely embedded in CITES must be respected without exception. Anyone in our industry who ignores the legitimate core of these debates simply makes themselves vulnerable. Yet the public verdict is becoming more differentiated, and simplistic black-and-white narratives are losing traction, an empirical factor we cannot ignore.

In the same context, another development, perhaps even more important for our pipeline, is gaining momentum: the often exaggerated demands for traceability, documentation, and proof, is beginning to weaken. We are not saying transparency is unimportant. But we do see “compliance fatigue” across many industries: ever more lists, seals, questionnaires, audit loops, and in the end the sense that paper has been produced, not necessarily better practice.

There is also an uncomfortable but logical point that matters: anyone speaking seriously about circularity cannot avoid leather as a by-product of the meat industry. If animals are slaughtered anyway and hides exist, utilising that resource is not the problem; produced cleanly and responsibly, it can be part of the solution. It is no coincidence that wool has experienced a meaningful comeback and that something similar now appears to be emerging for leather. Both are natural materials, both represent “authenticity” and both fit a time in which many consumers still talk about sustainability while increasingly wanting products that do not fall apart after two seasons.

From our perspective, however, it is not as simple as it may sound. There are two fundamental trends that must be considered. Leather can only regain market share if it becomes recognisable again for what it truly is. The classification and industrial mass use that have destroyed the material’s properties and character will not be successful. Leather can convince buyers through its intrinsic qualities. It can appear exceptional as a product, made and presented with the confidence it deserves. These are the classic core competencies of the leather industry. We need to put the industry back in a position to use them, to mobilise creativity and manufacturing competence.

Over recent decades, the trend has moved in the opposite direction. In brand offices, products were designed backwards on slides, and leather was then expected to fit the concept. This narrowed usage standardised the product further and further, and the more interchangeable a product becomes, the more price-sensitive it inevitably is. Today large volumes of leather can be produced in broadly similar quality in many places across the world. The situation was exacerbated by a standardisation obsession and a certification frenzy: more constraints and less freedom of movement for the industry.

But if you remove from the producer the ability to develop, to adapt to the natural realities of the material and, most importantly, to integrate all quality grades, you prevent sensible, resource-efficient production and use of leather. Leather is, by definition, a material with a range. There is not only A-grade; there are scars, brand-marks, insect marks, structural differences, thickness variation, differences in dye uptake. In a healthy leather economy, this range is not a defect; it is raw material for different applications, designs and price points. If you standardise that range away, you end up with only a narrow strip of what is marketable, while the rest is devalued or pushed into channels that make little ecological or economic sense.

This is where we have arrived. And we believe that more and more players are recognising the hopelessness of these conditions. Whether and how change can be implemented now depends on the dialogue between producers and processors. Major hurdles have already been removed. One hears sentences again that have been absent for a long time. Brands want  “We want “real materials” again, they want differentiation. They are willing to use materials that are “not perfect, but true.” Many consumers are tired of synthetics, tired of products that are sold as sustainable but do not feel like it. They want authenticity.

At the same time, this moment is fragile. The industry can waste it if it assumes that leather being back automatically means selling more. If leather returns, it returns differently. It returns as a material that must be explained. It returns as a material that must be shown, not as an interchangeable surface. It comes from a hide and a hide has a story. For too long we have justified leather instead of presenting it. Those who sell leather with eyes lowered will ultimately receive the price that matches that posture. Those who sell it with confidence, with facts, transparency, respect for animals and resources, but also with joy in aesthetics will find demand again. That demand does not have to be mass to create a new dynamic; it only needs to grow steadily, be visible, occur in the right segments and reward differentiation.

And then there is the logistics dimension, which may shape the coming months strongly. We have all seen how quickly a two-week delay can shift an entire season, and how brutal pricing becomes when that happens. Precisely here, the re-shoring debate can intensify, not as a political slogan, but as a business calculus. When transport becomes expensive, unreliable or risky, and planning certainty declines, questions over having everything travel around the world become pressing again. Re-shoring can affect leather production and downstream processing. Capacity and know-how are not available at the push of a button, and cost structures are real. Yet the parameters are shifting: labour costs are no longer the only argument. Energy prices, risk, financing costs, lead time, carbon footprint, regulatory requirements and reputation all form part of the equation. 

In sheepskins, the pickup in the apparel sector is clearly noticeable, and rising wool prices add a second driver. This has not yet translated into sharply higher raw material prices across the board, but the direction is visible. If the positive impressions from fairs and pre-showings translate into solid orders, higher prices must be expected. And then a reality returns that many have almost forgotten: availability is not guaranteed. In such a scenario, more than one tanner may suddenly realise that their preferred article is no longer available in the required volume, certainly not in the quality and selection needed for their programmes. Sheepskin materials are not a scalable industrial commodity; it depends on slaughter and shearing cycles, regional demand and sorting. If demand and the by-product logic tighten at the same time, apparel on the skin side and wool on the fiber side, constraints can start quietly and then become expensive very quickly. Anyone who believes they may be affected should not treat this as a footnote, but address it concretely: which articles are critical, where are real alternatives, which specifications are realistic, and what is the sourcing strategy if material is no longer available on demand?

In splits, two factors play a weighty role: the fashion trend for suede and the collagen market. Suede currently looks more like a broader material movement than a short-lived look; it runs into multiple segments and changes how split material is valued in quality and volume compared to phases where “smooth and uniform” was the only dogma.

At the same time, the collagen market pulls material away. The market is not yet balanced because not all options for alternative use or substitution have been exhausted. Our expectation, however, is that this adjustment process will accelerate and, ultimately, cannot be avoided. The clearer demand shifts in leather articles toward differentiation, surface effect and material character, the less the old models work, those in which split material and by-streams were treated as residuals. Those who ignore this may not be “wrong” immediately, but they will be surprised when a material assumed to be safely available and price-stable suddenly competes with alternative uses and thereby develops a new price floor. In this context, our remarks on leather production are relevant: if value creation returns through character and variety, by-streams must be integrated systematically: not at the end, but from the beginning.

The next two weeks will be marked by the APLF exhibition in Hong Kong (March 12-14). After that, a final and more complete picture of the global leather pipeline will emerge before the second and third quarters of 2026, which traditionally bring weaker production. The only factor that could still materially change this seasonal pattern is the footwear industry and its material mix. If leather content returns there at scale, then “moderate pickup” turns into “real pressure” very quickly. It will be worth watching signals from this segment particularly closely over the coming weeks. 

We hope that everyone can travel and travel safely to Hong Kong. At the time of writing this could become a problem for everyone coming from or travelling via the Gulf region.

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