The Bangladesh Tannery Association (BTA) on Wednesday backtracked on its earlier decision on rawhide purchase, agreeing now to start it on Saturday after an emergency meeting with trade officials at commerce ministry.
The BTA in a press briefing held at its Dhanmondi office in the morning on the day announced that they would start purchasing rawhides on August 20.
Later on the day, after an emergency meeting with commerce ministry officials, the tannery leaders changed their decision.
"As per request from the commerce ministry, we have agreed to start buying rawhide on Saturday," BTA President Shahin Ahmed told Dhaka Tribune.
He said the association, however, requested the government to withdraw its decision on rawhide export.
"This will affect the leather industry badly if the government does not reconsider its abrupt rawhide export decision," he said.
The commerce ministry on Tuesday issued a notice saying the government decided to allow rawhide export in a bid to ensure fair prices.
Commerce Minister Tipu Munshi on Wednesday again asserted that the government’s decision of rawhide export would come into effect immediately.
"The commerce ministry officials assured us of considering our appeal for scrapping rawhide export decision after observing the market situation in the next few days," Shahin said.
If the government allowed export of rawhide, the local leather industry would face severe problems as the price of the raw material would go up, the BTA leader said, expressing grave concern.
There was a huge number of people engaged in the leather industry who might lose their jobs and around Tk7,000cr investment would come under risk if the government stuck to its decision, he observed.
Asked if the tanners had any role in price manipulation, Shahin answered: "We do not buy rawhide directly from the seasonal retailers. So there is no way we had any role in the price fall."
The price of rawhide fell sharply this year where the cowhide was sold as low as Tk100-200 per piece in the wholesale market, causing huge losses to small traders who bought those at Tk400-500 per piece.
The goat-hide sold as low as Tk10, frustrating the small traders further.
On the low prices of rawhides, Tipu Munshi on Wednesday said such low price of rawhide indicated price syndication.
He said the government noticed that the rawhide was not being traded as per the government-set prices.
‘Although the price was set after discussion with the industry stakeholders, it has no reflection in the market. It indicates that only a handful of traders are being benefited,’ he said while talking to reporters at his Rangpur residence.
According to the industry insiders, 50% of total rawhide collection is made during Eid-ul-Azha.
They think the relocation of the tannery industry to Savar has affected the overall industry as most of the leather exporters and tannery owners are suffering due to their relocation from Hazaribagh.
In the last fiscal year, Bangladesh’s export earnings from leather sector suffered a huge drop of over 12% at $1.08 billion, down from $1.23 billion in 2016-17.
Ahead of Eid, the government set the prices of cowhide at Tk45-50 per square foot for the Dhaka region and Tk35-40 for other parts of the country.
The price of rawhides of goat was set at Tk18-20 which was Tk20-22 last year.
