Leather Prices Continue To Rise, Imbalance Between Supply And Demand Is The Main Reason.

Earlier than a year ago, the president of the leather industry admitted that he was at a loss as to the price of the rising raw leather, and that professionals in the industry had warned the potential shortage of raw materials for P.

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< p > but at the opening ceremony of the Asia Pacific Leather Exhibition in Hongkong, a speech from leather industry professionals showed that the speed of the price going into the rising orbit did not show signs of slowing down: the first 3 months of 2014 witnessed the fact that the price of raw leather reached the highest point in history.

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< p > "where is the peak of the market? We don't know.

At the moment, we can not see the peak of the market. "

Don Oshman, chairman of Hidenet, thinks.

Last year, at the China International Leather Exhibition held in Shanghai, Mr. Oshman told reporters in China Leather net that the demand for raw leather in the global market has been rising all the way, but the supply has not changed accordingly.

In the Asia Pacific Leather Exhibition, Mr. Oshman explained again that in the US market, the price of Texas cowhide (mainstream leather in the US market) increased by 17.4% from 2012 to 2013, and in just 3 months this year, the price has soared 9.7%.

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The "Domino dominoes" effect of "P >" is obvious.

As the price of finished leather has not kept pace with the price of raw materials, tanneries are trying to narrow the gap and raise the price of finished leather.

Taking the average price of shoes as an example, it increased by 8.6% last year, but has jumped by 6.4% since the beginning of this year.

Then the major shoe brands and retailers were affected. They signed the raw material procurement contract with suppliers 3 to 6 months in advance.

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< p > in fact, not only the price of leather raw materials is rising, but also the price of other subsidiary products of leather products has recorded a "record" increase.

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< p > < strong > supply and demand < /strong > /p >

The rising trend of < p > stems from many factors, one of which is the basic principle of economics, supply and demand.

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For P, the supply side is still limited due to the increased consumption of meat by consumers in China, India and even EU countries, and the by-product of the meat industry.

In India, Brazil and China, the number of cattle stocks in the world's largest raw leather supply market has remained stable.

In the United States and other countries, the competition for land between other crops and pastures means that the number of cattle can not grow.

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< p > but market demand for leather products including shoes remains strong.

Among them, footwear products require about 50% to 55% of the world's leather raw materials, and other industries such as auto manufacturers (currently using around 12% of the world's leather) and other products including gloves, clothing, wallets, handbags, belts and furniture manufacturers (currently using about 38% of the world's leather) make the competition for leather materials more competitive.

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At the same time, other factors are also inhibiting the supply of leather industry, resulting in the increase of raw material prices. P

According to Joss Fernando bellow, President of the Brazil tannery industry center (CICB), nearly half of the world's raw leather supply is controlled by the government, including Argentina, and Brazil and other countries have not increased the benefits of EU GSP customs since the beginning of this year, resulting in an increase of 3% to 4% of the price of raw leather.

But he believes that tanneries and downstream customers demand for raw and finished leather in Brazil, so that they are ready to pay higher prices.

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< p > Oshman adds that people are willing to pay such a high price because the brand enterprises can pass the extra cost to the retailers.

In the future, he expects that this year's market trend may be similar to that of last year, and the price will decline in the summer because of the low sales season.

"What will the future market be? The supply is basically stable, and consumption will rise as a result of the global economic recovery and the demand for fashion."

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