The All China Leather Exhibition (ACLE) is celebrating its 20th Anniversary this year that coincides with the 30th Anniversary of the founding of the China Leather Industry Association (CLIA) and the culmination of an environmental revolution that has taken place in China’s leather sector.
Some three years ago China’s central government decided to tackle the growing and dangerous problem of polluting industries to safeguard the environment and the health of its citizens that live near industrial installations.
This clean-up ended about six months ago and polluting tanneries that could not invest in modern equipment and effluent treatment plants have been closed leaving the slack in production to be taken up by modernized tanneries. These do not pollute the environment and can produce sustainable leather that is more marketable and attractive to fashion buyers and end consumers alike.
Against this background APLF spoke in detail with Su Chaoying, Honorary Chairman of the CLIA to learn about the progress of China’s leather sector and the latest statistics that illustrate the progress taking place.
Latest Figures from China’s leather sector
Mr Su remarked that there was a lot of uninformed gossip being spread about China’s leather sector when those making such comments did not have access to the facts of the current situation.
Here are some important facts mentioned by Mr Su for companies doing or wishing to do business with China:
- Import tariffs on hides & skins into China have not changed. They range from:
- 5-14% for sheepskins
- 5-8% for crust and wet blue
- 7-8% for cow hides
- Import tariffs on leather shoes have been reduced from:
- 24% to 10%
- 10% to 8%
- 15% to 6% according to the type of shoes.
- Imports of raw hides from January to March have dropped:
- by 8% in volume
- by 15% in value
That is mostly due to the drop in demand from the Hebei region but all the other clusters have increased their imports by 13%.
The top 5 tanning clusters are in the provinces of:
Fujian + 8.1%
Note: The volume of light leather from January-March produced by medium and large sized tanneries achieved 9.3% growth compared to the same period last year reaching 155 million sqm.
In relation to Hebei, which has been mentioned quite often in the international media, it is only here that imports of raw hides have dropped significantly.
This is because the tanning clusters in Wuxi and Xingji are undergoing a second round of restructuring which will lead to more closures of polluting tanneries and further reduce the number of tanneries in those clusters from 103 to about 35 through mergers and acquisition but volume production should be back to normal by the end of this year.
The increase in light leather production in Q1 of 9.3% is a positive sign that the industry is consolidating and imports of raw hides indicates that production is on the increase and will receive a further boost when the restructuring in Wuxi and Xingji is completed.
Lower import tariffs offer opportunities to footwear exporters as the sector consolidates and consumer spending continues growing at around 10%.
With China producing and buying most of the world’s new vehicles and passenger cars (see graphs as below), as well as leathergoods, garments and above all leather footwear, there are ample opportunities for western suppliers of leather and tannery chemicals to do business with the auto seating and fashion accessories sectors in China.
Despite growing production and exports from ASEAN nations, principally Vietnam, China still remains by far the biggest volume producer of leather and leather products surpassing the combined production and exports of all ASEAN neighbours put together.
The CLIA and APLF offer the ideal platform for exporters to position themselves and do business with China (and ASEAN) by participating at the 20th Anniversary edition of ACLE that will take place in Shanghai from 29 August – 1 September 2018.