According to the Centre for the Brazilian Tanning Industry (CICB) despite having reported record leather exports in 2007, production is set to fall by between 5% and 10% in 2008 due to lower beef consumption.

Commenting on the prospects of the industry next year, managing director of CICB, Luiz Augusto Bittencourt, said that although the demand for leather is increasing as people are now eating less beef, the availability of raw material will inevitably keep falling??and as a result he estimates that only 40 million cattle will be slaughtered in 2008, three million fewer than this year.

At present Brazilian tanneries process an average of 45 million hides per year of which 35 million are exported. Exports are expected to grow 23% in terms of revenue this year to a record $2.3 billion, but the trend towards lower volume is already becoming apparent. Although leather exports had increased 25% in terms of value up to September, volume had already fallen 1% year-on-year as a result, according to Dr Bittencourt, of the reduced slaughter. He also predicts that wet blue exports will fall 8% while finished leather exports are expected to grow 16%, mainly as a result of increased demand from the automotive sector. 

The situation is also causing concern in the chemical industry. Fábio Bellotti da Fonseca, manager of the Leather business unit at Germany-based Lanxess, believes that revenue from chemical sales will drop 7% this year to $296 million and approximately 5% in 2008. He also noted that tanneries are already producing less finished leather. He said, "Brazilian finished leather consumption is lower. Footwear production has dropped from 348 million pairs to 206 million pairs in the last two years." In 2007, the leather chemicals market has seen an 8% decline in sales of wet blue leather chemicals to $120 million, a 4% drop in crust leather chemical sales to $103 million and a significant 12% fall in finished leather chemicals, which have fallen to $ 74 million. 

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