Leather From Africa In Demand
African countries are fast emerging as the leading suppliers to the global market for raw hides...
A frica is fast emerging as one of the future markets for sourcing quality leather and hides for the booming global leather industry. Leather and leather products are among the most widely traded and universally used commodities in the world. Already, the total value of annual trade is estimated at 1.5 times the value of the meat trade; more than five times that of coffee and more than eight times that of rice.
Formal international trade in leather and leather goods is estimated at over US$ 50 billion a year and the market is far from saturated. In the next decade, the demand for leather raw materials (hides) and finished products may exceed supply – making the leather industry one of the most lucrative business sectors in the years to come.
Africa’s abundance of livestock represents a natural strength for the sector, as leather is a by-product of the meat industry. Africa has about 15 per cent of the world’s cattle population, a percentage that grew by about a quarter over the last decade, overtaking the global trend. Similarly, Africa possesses about 25 per cent of the world’s sheep and goat population. This puts African at the centre of the booming leather industry as a key supplier of hides and raw materials to the growing industry of leather and leather goods.
However, despite its significance as a livestock producer, Africa accounts for only eight per cent of world production of cattle hides and about 14 per cent of goat and sheepskins. Further, even though African countries often rank leather high in importance as an export commodity, leather and leather products generally account for less than four per cent of total exports. This is largely due to the fact that the leather industry in most African countries remains an unorganised sector.
However, things are now changing repaidly as more and more countries around the world are looking to source their requirements for leather and hides from African countries.
India, for instance, is now looking to import leather from East Africa. Faced with the threat declining leather exports, the Indian Council for Leather Exports (CLE) recently sent a team of Indian exporters to Ethiopia and Kenya to identify future prospects of joint ventures with tanneries in these African countries.
The Indian leather industry’s export target of $7 billion by the year 2011-12 can only be achieved by finalising longterm raw material supply from Africa.
India produces approximately two billion square feet of leather but exports would need another two billion square feet per annum of superior quality hides. India’s total export of leather and leather goods stand at $1487.13 million and is set to register a drastic increase in coming years.
Exporters in India have already identified Africa with its huge livestock population as a good source of hides and skins. Ethiopia and Kenya are among the largest producers of raw leather in Africa. Indian exporters are exploring joint ventures with African companies looking for technical assistance, know-how and investments. These JVs would convert raw hides and skins into semi-finished leather for shipment to India.
Countries in the Horn of Africa are one of the largest ecporters of livestock, specially to the Middle East countries. For Ethiopia, for example, livestock and livestock products are the major foreign exchange earners, second only to coffee, with hides and skins contributing the most.
The Middle Eastern countries have been a traditional export market for countries in the Horn of Africa including Ethiopia. The Horn of Africa countries used to export up to 3 million sheep and goats, 100,000 cattle and 50,000 camels per year to the Arabian peninsula till 2005. In recent years, however, increasingly stringent health and quality control regulations in the importing countries restricted exports to these countries. In September 2000, Middle East countries banned imports of live animals from six countries in the Horn of Africa and Nigeria due to an outbreak of Rift Valley fever. Although the outbreak of Rift Valley fever triggered the recent ban on imports of animals from Ethiopia (and other Horn of Africa countries), most likely the ban has been prompted by a number of other factors.
Other major exporters of live animals are Somalia and Kenya, and to a lesser extent Sudan and Djibouti.Together, these countries export a fare share of requirements of the livestock and leather industry worldwide. The coming years can see these countries emerge as major players in the leather industry.