Traditional Leather Market

Traditional Leather Market: Overview

• Leather is a durable material produced through the process of tanning raw animal skin and hide to preserve for longer duration
• Traditional leather has several features, which make it superior to synthetic products, including durability, comfort, beauty, suppleness, and resilience. Traditional lather is used in various industries, such as footwear, automobile, furniture, garments, and luxury goods. 

Rise in Utilization of Waste from Meat Industry to Drive Traditional Leather Market

• Animal skins and hides are considered waste products in the meat industry. The traditional leather industry recycles the skins and hides to produce leather.
• According to the UN Food and Agriculture Organization (FAO), the meat produced in 2018 was around 335 million tons. In 2017, the meat production stood at around 330 million tons. This is an increase of 1.5%, which is the highest since 2014. Over the past few years, there has been a significant increase in meat consumption in China, the U.S., Japan, Mexico, and South Korea. For instance, every individual in the world currently consumes 43.7 kilograms of meat every year on an average, which was around 25 kilograms in 1965.
• Rise in meat consumption ultimately leads to higher production of wastes, including skins and hides. These skins and hides are disposed of by dumping in landfills. This dumping in landfills is likely to be expensive in the near future, as governments are planning to increase the landfill tax. For instance, in the U.K., the standard rate of the material dumped was around GBP 88.95 per ton in 2018, which is expected to rise to GBP 94.15 per ton by 2020. These stringent regulations are intended to promote the reuse of waste materials being dumped in landfills.
• Dumping of skins and hides in landfills is not financially feasible. However, use of skins and hides in traditional leather manufacturing would lead to creation of new jobs, rise in wealth, and enhancement of lives of people associated with the traditional leather industry.
• Rising use of waste from the meat industry is estimated to drive the global traditional leather market during the forecast period. 

Concerns over Usage of Hazardous Chemicals during Tanning Process

• The leather industry is one of the major pollution-generating industries. Leather processing causes unfavorable impact on the environment. In the tanning process, hazardous chemicals are used, some of which are carcinogenic. These include chromium compounds, limestone soda ash, cyanide-based finishes, arsenic, coal-tar derivatives, sulfuric acid, sodium chlorate, and aldehydes. All these untreated chemicals are released in nearby water bodies, which causes sharp increase in water pollution.
• In India, the Jajmau area of Kanpur has witnessed hazardous effects of pollution from the leather industry, wherein untreated chemicals are released in river. The same water is used for irrigation to farmland, which leads to a steep decline in the productivity of food, crops, and vegetables. More than 11 million people are affected by this water, and around 10,000 have died due to various diseases, including cancer.
• The chromium tanning process generates a large quantity of waste, due to the repetitive process of soaking raw hides and wringing them out, which are contaminated with several chemicals. This wastewater not only damages water bodies, but also soil in nearby areas, which cause a severe impact on marine as well as land life.
• Vegetable tanning, however, is a more eco-friendly method to produce leather, but the time taken to produce leather is much higher than that in case of chromium-tanned leather. Vegetable tanned leather is also more expensive and has limitations in terms of color. Unavailability of skilled labor is another disadvantage of the vegetable tanning process.
• Rise in awareness about environment and stringent government rules and regulations are projected to restrain the growth of the traditional leather market during the forecast period 

Innovation in Lab-grown Leather from Animal Cells to Offer Growth Opportunities

• Traditional leather is made of animal hides and skins. Due to rise in awareness about animal welfare and environment-related concerns, the demand for traditional leather in North America and Europe has declined marginally in the past few years.
• In the U.S., there has been 32% decline in cattle population in the last decade, as several individuals are avoiding meat as well as traditional leather products
• In order to address this issue, some companies are producing leather through the animal cell culture method in labs. In this method, animal cells are grown in a lab in a suitable medium to produce products that can replace animal leather.
• Few companies are using advanced technologies, such as 3D printing. In this method, a layer of animal skin is printed, which can be used as a substitute for traditional leather. This type of traditional leather is produced without hurting the animal and it has a lower carbon footprint than traditional leather. This factor is considered a key driver of the global traditional leather market. 

Traditional Leather Market: Key Developments

• In April 2019, Wollsdorf Leather Mexico invested US$ 44 Mn in its new production facility located in Guanajuato, Central Mexico. The company is expanding its production to up to 15,000 animal hides per week; earlier, the production capacity was 5,000 to 7,000 hides per week. This plant would process from wet-white and wet-blue to traditional leather, to target the rising demand for traditional leather in the U.S. automotive segment.
• In October 2019, ECCO opened its new high-tech leather cutting plant in Xiamen, China. The new plant is among the most advanced cutting plants in the world, with state-of-the-art technology and reduced environmental footprint.
• In July 2018, Gruppo Mastrotto presented new leathers meant for use in the manufacturing of footwear, leather goods, belts, and accessories at the International Shoes & Leather Vietnam Fair held in Ho Chi Minh City, Vietnam
• In September 2019, ECCO Sko A/S reopened its OMOTESANDO store in Tokyo, Japan. It is ECCO’s first store to have the new fused concept of Premium Concept X Tannery Exclusive. 

Asia Pacific to Dominate Traditional Leather Market

• Asia Pacific dominated the global traditional leather market in 2018. The market in the region is estimated to expand at a significant pace during the forecast period, due to rapid growth in end-use industries, such as footwear, automobile, furnishing, garments, sporting goods, and luxury goods, especially in developing countries such as China, Japan, and India.
• Europe also accounted for a large share of the global traditional leather market in 2018. European countries are considered as fashion hub of the world, and the traditional leather products are known for their quality and premium appearance worldwide.
• The traditional leather market in North America is projected to expand at a moderate pace during the forecast period, as the market in the region is mature 

Traditional Leather Market: Competition Landscape

• The traditional leather market is highly fragmented; there is a presence of a large number of players operating at local, regional, and international levels
• Key players operating in the global traditional leather market include
  • Rahman Group PAKKAR
  • Superhouse Group
  • JBS
  • KG Leathers
  • Özyüksel Leather Company
  • KOKTASLAR LEATHER
  • Gruppo Mastrotto
  • ECCO Sko A/S
  • Siddiq Leather Works (Pvt) Ltd
  • SAMSONS INTERNATIONAL
  • TANNERIE D'ANNONAY