Trade
5 years ago

Dispute over dues

Tanners, merchants meet today to resolve crisis

File Photo (Collected)
File Photo (Collected)

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Updated :

Tanners and hide merchants are meeting today (Saturday) in the capital to settle the arrears dating back to the 1990s.

The meeting will be mediated by the Federation of Bangladesh Chambers of Commerce and industry (FBCCI) at the Federation Bhaban in Dhaka.

Against the backdrop of price slump in rawhide and the resultant crisis, the two parties sat on August 24 to make a list of hide merchants who have dues from tanners as decided on a previous meeting brokered by the apex trade body.

Secretary of the Bangladesh Hide and Skin Merchants' Association (BHSMA) Tipu Sultan said they sat with tanners and prepared a list of hide merchants.

He said the list is not complete yet, but both parties agreed on many things.

"We are sitting tomorrow (Saturday) again at the FBCCI office and the remaining issues will be resolved," he told the Financial Express.

Representatives from the Bangladesh Hides and Skin Merchant Association (BHSMA), the Bangladesh Tanners Association (BTA) and the Bangladesh Finished Leather, Leather Goods and Footwear Exporters' Association (BFLLFEA) and industries and commerce ministries will be present at the meeting.

The country's tanners have agreed to pay the arrears to rawhide merchants in three installments in the previous meeting held on August 22.

Tanners owe money to rawhide merchants dating back to the 1990s, but insiders say the bulk of the amount falls from 2015 through 2019. The two other periods are 1990-2010 and 2010-2015.

BTA general secretary M Shakhawat Ullah said the issue will be resolved at the meeting.

Explaining the longstanding dues, Mr Ullah said the waning demand and supply crunch of hides in the global market, relocation of tanneries, discontinuation of production in many tanneries, the pressure of environmental compliance are among the reasons for the price crisis.

He said around 20 to 25 tanneries have discontinued their business in the last few years while around 33 more tanneries couldn't start production in the new industrial park at Savar yet.

"All parties including the government and hide merchants have to understand the causes that triggered the crisis," he said.

On August 18, the commerce ministry organised a meeting to resolve the deadlock between the tanners and wholesalers as the latter announced that they would not sell rawhides to the tanners until they paid around Tk 4.0 billion owed to them.

Initially, rawhide wholesale traders had refused to sell hides to tanners as they were offering lower prices.

After the August 18 meeting, hide merchants started selling hides and skins of sacrificial animals on a limited scale.

The government set prices of per square foot of salt-treated cowhide and buffalo hide at Tk 45-50 in Dhaka and at Tk 35-40 elsewhere.

The price of goat skin has been set at Tk18-20 and Tk 13-15 for 'baqri' goat across the country.

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