Bangladesh’s leather exports have witnessed a sharp decline in the first half of the current fiscal year, dropping by 11.65% year-on-year. According to the Export Promotion Bureau (EPB), exports totaled $62.48 million, down from $70.72 million during the same period in FY24.
Industry leaders and exporters blame the decline on Bangladesh’s failure to secure Leather Working Group (LWG) certification, a key requirement for exporting leather to major international markets, particularly in Europe.
The lack of certification has severely impacted the country’s competitiveness, forcing it to rely primarily on China, where buyers are exploiting the situation by pushing prices down.
Tannery owners point to the poor compliance of the Central Effluent Treatment Plant (CETP) and solid waste management in the industrial city as the main obstacles to obtaining LWG certification.
Despite repeated concerns, no clear roadmap for resolving these issues has been provided by the authorities.
Md Sakhawat Ullah, General Secretary of the Bangladesh Tanners Association, echoed these concerns, emphasizing that without LWG certification, European buyers remain out of reach, leaving Bangladeshi exporters at the mercy of Chinese buyers who exploit the situation to push prices down.
“Everyone knows the crisis in this sector and the solution. Without LWG certification, we have no access to the European market, and brand buyers can’t come. Our dependence on China has allowed Chinese buyers to exploit the situation, constantly driving down leather prices.”
“When a buyer orders high-grade leather, they downgrade a large portion during inspection, reducing its value by 20 to 25 cents,” Sakhawat explained.
Industry insiders claim that a syndicate of Chinese buyers is taking advantage of Bangladesh’s export crisis. A tannery owner, requesting anonymity, alleged:
“They place bulk orders, then cancel or downgrade a large portion, forcing us to sell at lower prices. This manipulation has made it impossible to get fair rates from other buyers.”
Related News – Bangladesh Leather Exports Drop 11.65% to $62.48 Million in First Half of FY25
