Seasonal traders across the country have thrown away thousands of pieces of rawhide of sacrificial animals, failing to sell those for a lack of demand.
The traders and rawhide merchants put the prices of the dumped rawhide at around Tk 100 crore.
“I bought 250 pieces of cowhide from farmers for Tk 100-500 per piece. But I could sell only 150 pieces to merchants at less than the purchase prices. I left the remaining 100 pieces on the roadside,” said Moinul Islam, a small trader in Oxygen area in Chattogram city.
Like him, many small traders all over the country dumped rawhide beside roads as they could not find any buyers.
Merchants said they had to stop buying rawhide from seasonal traders for a lack of capital as tanners were yet to clear their dues.
Besides, there are allegations that a syndicate has been behind this sudden fall in demand for rawhide.
Commerce Minister Tipu Munshi yesterday blamed a section of businessmen for manipulating the market prices of rawhide, reports Bangla daily The Prothom Alo.
Rawhide was sold at significantly low prices over the last 11 years as merchants didn’t buy it at the government-fixed rates, he told journalists at his Rangpur residence.
Before the Eid-ul-Azha, the commerce ministry fixed the prices of rawhide of cows and buffaloes at Tk 45-50 per square foot in the capital and Tk 35-40 elsewhere.
The price of rawhide of castrated goats was fixed at Tk 18-20 per square foot, while it was Tk 13-15 for that of uncastrated goats.
Around one crore sacrificial animals are slaughtered on the occasion of the Eid-ul-Azha every year.
Commenting on the issue yesterday, Road Transport and Bridges Minister Obaidul Quader said the government is investigating whether any syndicate has been behind the fall in demand for rawhide.
“Action will be taken if anyone is found guilty… no one will be spared,” Quader, also Awami League general secretary, told reporters at the Secretariat, reports BSS.
In Chattogram City Corporation areas, seasonal traders dumped more than one lakh pieces of rawhide of cows and buffaloes on the roadside as there were no buyers.
The situation was similar in parts of Dhaka, Narayanganj, Narsingdi, Sylhet, Rajshahi and many other districts.
Cowhide was sold between Tk 100 and Tk 150 a piece whereas the usual price was around Tk 2,000, a number of seasonal traders and farmers told our correspondents in different districts.
In many cases, farmers gave small traders rawhide of goats and sheep for free as there was no demand for those.
Many madrasas, which received thousands of pieces of rawhide in donation during the Eid-ul-Azha, failed to sell those due to a lack of demand.
Abdur Razzaq, a teacher at Ehsanul Ulum Madrasa and Etimkhana in Narayanganj, said they sold around 450 pieces of cowhide for around Tk 500 a piece against the usual price of Tk 1,700.
He said that every year they used to get around Tk 8 lakh from the sale of rawhide, which could meet almost 70 percent of the madrasa’s expenses.
“But this time, we have so far managed to get only Tk 2.2 lakh from rawhide sale,” he added.
Talking to this newspaper, a number of rawhide merchants blamed a lack of capital and excessive supply of rawhide for the fall in demand.
Delwar Hossain, president of Bangladesh Hide and Skin Merchants’ Association, claimed that merchants had to stop buying rawhide from seasonal traders as tanners had paid the merchants only a small portion of their dues before the Eid.
Tanners buy rawhide from merchants on credit throughout the year and clear the dues in phases. The dues stood at around 400 crore as of yesterday, he said.
Delwar mentioned that tanners usually pay at least 40 percent of the outstanding amount before the Eid-ul-Azha every year, but this time they paid around 5 percent of the sum.
Tanners had paid merchants between Tk 30 and Tk 35 crore, which was too inadequate to buy rawhide at the government-fixed rates, he said.
Delwar, however, said a few tanners had cleared all the dues before this Eid.
He further said tanners had paid the merchants Tk 75 crore before the Eid last year, when rawhide prices crashed to a 10-year low, dealing a heavy blow to seasonal traders.
The situation has worsened this year, he added.
Contacted, Md Shaheen Ahmed, chairman of Bangladesh Tanners’ Association, opposed Delwar’s statement on the outstanding amount, and said they paid rawhide merchants Tk 150 crore.
He also said tanners would start buying rawhide from merchants on Saturday at the government-fixed rates.
Shaheen mentioned that tanners buy 70 percent of the rawhide from merchants and the rest from small traders. And around 60 percent of the rawhide is collected during the Eid-ul-Azha, he said.
Replying to a query, he said tanners were reluctant to buy rawhide this year as they already had good stocks of tanned leather. Besides, the demand in the international market was low.
About a recent government decision to allow export of rawhide, the tanners’ association chairman said the move could harm the tanneries and leather industry in the country.
The industry might not get adequate rawhide if it is exported, added Shaheen.
Talking to this newspaper yesterday, Md Mofizul Islam, senior secretary of the commerce ministry, said the government took the decision to allow export of rawhide to ensure fair prices.
“We will allow shipment of rawhide if anybody wants,” he said.
About dumping of rawhide by seasonal traders, he said, “It was an irresponsible act. They should have applied salt on rawhide to preserve it.”
Nasir Khan, vice president of Footwear Manufacturers and Exporters Association of Bangladesh, said tannery owners were cautious about purchasing rawhide as prices of finished leather goods were showing a downtrend in the international market.
Nasir, also managing director of footwear maker Jennys Shoes, expressed doubt whether the government decision to allow export of rawhide would bring positive results for the sector.
The export may lead to a rawhide crisis in the country, he added.
In the newly-established tannery estate in Savar, 131 of the 155 tanneries are in operation.