Leather Pipeline: Do Asian tanners need to replenish their raw material stocks?
20/02/2018
After a couple of weeks of significantly reduced trading activity, with some reports that a number of tanners took a longer holiday than normal, next week should see a return to business as usual.
The report says there has been a great deal of discussion over how well the tanning industry is covered with regards to raw materials for the second quarter of 2018. It points out that there is uncertainty about whether or not Asian tanners will need to replenish their inventories when they return from the break.
It explains: “The optimists are convinced that the industry in Asia has been bluffing, with negative information about leather business being released in order to force suppliers to reduce their asking prices.”
This group believe the Asian tanning industry greatly needs to replenish its raw material stocks, which means tanners in the region will finally be forced to pay the asking prices of suppliers.
On the other hand, there are those who take the opposite position and insist poor sales figures in recent weeks suggest Asian tanners already covered their raw material needs at the end of 2017. “They expect suppliers to be disappointed in the coming weeks,” the Leather Pipeline report says.
It predicts the forthcoming APLF exhibition in Hong Kong (March 14-16) will be “the next breaking point” for raw material prices. This event will offer the first indication of who is correct – the optimists or the pessimists.
The full report is available here.
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