China – what to do with the domestic mega tanneries
Published: 12 Jun, 2019
Over the past 20 years China has built the largest hide tanneries ever known, many of these tanneries can process over 10,000 hides per day and employ a workforce of over 3000. At many tanneries the workforce lives on site for months at a time, only returning to their homes during national holidays. It is reported that some of the larger tanneries only become profitable when the through-put numbers exceed 6000 hides per day. So, it is perhaps no surprise that despite these very difficult times for the leather industry hides are still being purchased in large quantities by Chinese tanners. Stopping one of these enormous tanneries production, is said to be akin to slowing an oil tanker in full flow.
At present tanneries are buying hides at historical low levels (often, direct sales from the U.S. slaughter houses are said to be far below the reported prices). But vast quantities of the hides purchased and worked are going straight into wet-blue stocks, while the tanners wait for better finished leather conditions – in other words, just taking a position. For the very large tanners who employ thousands of workers, there is some government help. But the small / medium size tanners, mainly in the Wuji area are reported by one commentator as struggling to survive. The Wuji tanning area has had many problems in the past with pollution, at times tanners have been forced to close by the local authorities, when the pollution problems became too excessive. Wuji tanneries in the main process cow hides. One Chinese agency thoughts are that many of the smaller tanneries in this area will close or merge to save costs. But predicts the ability to process vast volumes of cow hides will become a thing of the past.
Only time will tell, if those tanneries stocking wet-blue have made financial wonder move or a disaster. That all depends on the future demand for finished leather. For further information from theSauerReport click here to register.