Rawhide trade into a tailspin

Although tanners were supposed to start buying rawhide at the government-fixed rates yesterday, merchants refused to sell, demanding the payment of a “considerable” portion of their arrears.

It comes after seasonal traders, farmers and madrasas across the country threw away thousands of pieces of rawhide of sacrificial animals after this Eid, failing to sell those.

The traders and rawhide merchants put the prices of the dumped rawhide at around Tk 100 crore.

Delwar Hossain, president of Bangladesh Hide and Skin Merchants’ Association, yesterday said, “Many tanners came to the rawhide market at Posta in the capital, but we did not sell any. We want them to pay us dues of Tk 400 crore.”

Merchants said the tanners should at least pay 50 percent of the money in cash so that the total outstanding amount does get even bigger.

The tanners also should say when and how they will clear the dues, Delwar told The Daily Star over the phone.

“We will place this issue before the commerce minister at a meeting tomorrow [today],” he said.

The market in Posta is the biggest rawhide market of the country. The situation was similar in the rawhide markets in Amin Bazar on the outskirts of the capital, in Mymensingh, Thakurgaon and Jashore.

Tanners buy hide from the merchants on credit throughout the year and clear the dues in phases. They pay at least 40 percent of the dues every year before Eid-ul-Azha.

Several merchants told this paper recently that the tanners paid only 5 percent of the outstanding amount before the Eid celebrated on Monday.

Tanners paid merchants between Tk 30 crore and Tk 35 crore, which was inadequate to buy rawhide at the government-set rates, Delwar said.

He further said tanners had paid the merchants Tk 75 crore before the Eid last year, when rawhide prices crashed to a 10-year low, dealing a heavy blow to seasonal traders.

Alamgir Hossain, a rawhide merchant at Posta, said some tanners came to the market yesterday to buy rawhide, but they were ready to make only 25 percent of the payment

“We want assurance that all our dues will be paid. I followed our association’s decision of not selling rawhide today,“ he said.  Meanwhile, talking to journalists after an association meeting at Posta yesterday, Delwar said, “Tanners claimed they paid merchants all the dues. This is totally untrue. Tanners want to run their businesses keeping us in a tight spot.”

Meanwhile, leaders of Bangladesh Tanners Association (BTA) yesterday claimed that they had started buying rawhide from merchants.

BTA General Secretary Shakawat Ullah told reporters at the Savar Tannery Industrial Estate that tanners began buying hide at Shambhuganj market.

“Usually, we start buying rawhide 10 to 15 days after Eid-ul-Azha. For this year, we planned to start buying the hide from August 20, but we started earlier following a rumour that rawhide was thrown away amid a poor demand,” he said.

Before the Eid, the commerce ministry had fixed the rawhide rates in consultations with other ministries, different divisions and departments, tanners and rawhide merchants.

The prices of rawhide of cows and buffaloes were fixed at Tk 45-50 per square foot in the capital and Tk 35-40 elsewhere.

The price of rawhide of castrated goats was fixed at Tk 18-20 per square foot, while it was Tk 13-15 for that of uncastrated goats.

This Eid, over 1 crore animals were sacrificed across the country. Of them, some 45 lakh were cows, bulls, and buffaloes, said rawhide traders.

Rawhide merchants have collected some 90 lakh pieces of hide from seasonal traders and farmers, said Delwar.

Talking to The Daily Star yesterday, Md Mofizul Islam, senior secretary to the commerce ministry, said his ministry was not aware whether tanners started buying rawhide yesterday.

“We have called a meeting at the ministry Sunday [today] to discuss the issue. Tanners, merchants and other stakeholders will attend the meeting,” he said.

The secretary also said the ministry may also fix a minimum price rate of rawhide at the field level to avoid similar crisis in future.