Chaos ensues in Bangladesh over Eid al-Adha hides
14/08/2019
In the build-up to the feast, when Muslim families buy and slaughter cows, sheep and goats, usually selling the hides or skins to traders immediately afterwards, the government set an agreed price for the material. This year the agreed price for cowhides was to be around $0.55 per square-foot in the capital, Dhaka, and $0.45 per square-foot in other parts of the country.
However, on August 14, as the festival was coming to a close, commerce minister, Tipu Munshi, said business syndicates of wholesale hide traders had been refusing to pay the agreed prices, insisting on lower offers in the knowledge that most small-scale local traders have nowhere to store the material.
For this reason, the minister said, the government had decided to allow traders to export hides and skins from Bangladesh. He told local media: “We fixed the price of raw hides ahead of Eid-al-Adha after consulting with leather traders, but unfortunately the price that came out in the market was extremely low and unacceptable. Hence, we decided to export raw hides.”
This announcement brought an immediate protest from the BTA. Its chairman, Shaheen Ahmed, said: “The government’s decision to export raw hides must be withdrawn immediately. Otherwise, the domestic leather industry will be in grave danger.”
Industry commentator and World Leather columnist Sam Setter, who is a frequent visitor to leather manufacturers in Bangladesh, said on hearing the news that Bangladeshi tanners’ inability to process the millions of hides and skins that have become available across the three-day festival is the main reason for the chaotic situation that is now affecting the leather supply chain there. But he insisted the blame lies mostly with the government.
He said the government’s decision to export some of the raw material is correct in terms of stopping hides and skins from going to waste. But he added: “This announcement shows the absolute failure of the government policy concerning the effluent treatment in the Savar tanning district. The tanneries have lost millions of square-feet in leather orders owing to non-compliance in effluent treatment.”
He said that the central effluent treatment plant (CETP) at Savar is beset by “total technical failure”; he said alleged financial irregularities are one of the causes. “There are several projects for the conversion of the Savar CEPT on the table and all it needs to move forward is for the authorities to make a decision. The cost of €25 million is peanuts for the Bangladeshi government. So why the delay? The government is listening to the wrong people.”
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