Finished leather goods export on rise

http://newagebd.com/newspaper1/business/12117.html

Finished leather goods export on rise

A file photo shows a worker drying leather hides on a river bank in Dhaka. An EPB report shows export of finished leather goods has surpassed the earnings from intermediary leather products. — AFP photo

Kazi Azizul Islam

As an intermediary product, leather has been among the top three products of Bangladesh’s export’s basket for the last several decades. But the scenario is changing now.

Export of finished leather goods or fully value-added items has surpassed the earnings from intermediary leather products, shows a report of the Export Promotion Bureau.

Industry people said fast expansion of export-oriented footwear and fashion leather goods industries has pushed Bangladesh’s leather industry into a new era.

They said more expansion would be there as global importers are taking new interest in sourcing from Bangladesh.

Many in the industry say that a billion dollar worth leather goods export sector for Bangladesh would emerge before long and would flourish like the apparel industry.

Footwear shipments earned $197 million in eight months of the current 2010-2011 fiscal year, growing more than 48 percent over the corresponding period of the last fiscal year.

Exports of non-footwear fashion leather goods, like handbags, travel bags, purses, and belts etc, increased by 153 per cent in July-February of the current fiscal year to $36.4 million.

On the other had, leather shipments earned $176 million in July-February, growing 35 percent year-on-year.

Industry insiders said growth in leather exports in term of volume remained slow but increased unit price in global market kept the earning growing.

But, they said, leather footwear and other finished leather goods shipments continued sharp increase in volumes also as production capacity in these industries are growing quite fast.

‘Bangladesh’s leather sector has entered into a new era of maximum value addition,’ said Syed Nasim Manzur, managing director of Apex-Adelchi Footwear, the country’s largest shoe-exporting factory.

Nasim sees that a huge room is there for Bangladesh in several hundred dollars worth of global market of footwear and fashion leather products.

Industry people say EU and Japan have been the traditional market for Bangladeshi footwear industry, but huge demands are coming recently from USA, which is quite a new market destination for Bangladeshi footwear exporters.

Apex’s Nasim said demand from earthquake-ravaged Japan might slow down in the coming months, but industry sees that fresh demand from USA, EU and other markets are very much convenient for further expansion of the industry here.

Though in the next two years the existing factories are likely to export more shoes, it is the new capacity [expanded and new factories] that will come on stream from early 2011 that is expected to cause the huge spur in growth.

The Export Processing Zones at present have 18 shoe and leather goods factories but there are at least seven large factories under construction, mostly owned by big manufacturers in the shoe world.

The factories under construction include Korean company Youngone’s footwear complex which is said to be the largest in Asia.

An official of Bangladesh Leather Goods Manufacturers’ and Exporters’ Association told New Age that shipment of fashion leather goods like women hand bags and purses increased sharply in recent times.

‘Increasing number of western retailers, who are working on diversified sourcing, have spotted Bangladesh as a potential source of fashion leather products as some manufacturers here have put efforts in product development,’ said the official.

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