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APLF-SauerReport to address Hide Market Crash
26
Mar '09
These are challenging times for the Leather Industry.A chronic over-supply of raw materials is impacting dangerously on the market. The situation will likely get worse - certainly in the near future and likely in the medium to longer term.

The Hide Market Crash is the ripple effect of the global economic crisis: plummeting sales in the automobile and household furniture sectors, both big leather consumers, caused a radical decline in demand for animal skins. A similar trend followed in other leather articles like apparel, small leather goods and footwear.

What can be done to ameliorate the situation? theSauerReport is co-organising a brainstorming session with APLF, where top industry professionals will exchange ideas, experiences and solutions.

The seminar will address concerns such as:
- how the industry will deal with the lowest raw material prices ever seen
- what to do with the world-wide surplus of raw material
- how to resolve all the financial and contractual problems that the crisis has already caused
- how consumer demand will develop

The Hide Market Crash: Implications on the Leather Industry
This primary cause of the problem of today is disparity in supply and demand. Hides and skins are available in only very slightly lower numbers but demand for leather may be down as much as 30 - 40% over all.

"The leather industry has no control over the supply of its raw material. As long as there is a demand for meat - and there is, in spite of the crisis-its by-product, hides and skins, keep coming in hundreds of thousands, every day," notes Ron Sauer, founder of theSauerReport.

Cattle hides, which are the source of 70% of global leather production, have lost about 50% of their value since October 2008. Tanners saw their orders reduced tremendously by the reduced demand for the final products.

Businesses now are trying to survive in midst of chaos. Orders were cancelled or renegotiated at much lower prices, shipments and payments were delayed, factories closed, workers made jobless, essential credits cancelled and reduced.

The leather industry is facing serious and dangerous challenges ahead. Isn't it time to address these problems together?

Seminar Information
When: Thursday, 2 April, 10:30am to 12:30pm
Where: Room 607 Hong Kong Convention and Exhibition Centre

Agenda
Opening and introduction to today's problems and the objectives of the meeting by Ron Sauer of www.theSauerReport.com

View from China and the International Hide Skin and Leather Traders Association (ICHSLTA) by Mme. Zhang Shuhua, Chairman of the China Leather Industry Association (CLIA) and President of ICHSLTA.

View from the United States and what happened to the China/US hide market relationship by John Reddington, President of the US Hide, Skins and Leather Association.

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