Home ECONOMY Raw leather exports fall as local use rises

Raw leather exports fall as local use rises

by biasharadigest
Market News

Raw leather exports fall as local use rises

Workers in a shoe factory in Limuru.
Workers in a shoe factory in Limuru. Local demand has reduced export of raw and semi-processed leather. PHOTO | FRANCIS NDERITU 

Raw and semi-processed leather exports fell 27.5 percent in the first nine months last year with 12,888 tonnes exported, earning Kenya Sh2.46 billion as the State sought to discourage the trade.

The drop was acute in the third quarter of 2019 at 2,966 tonnes valued Sh625 million, compared to an all-time high of 7,500.8 tonnes exported between January to March 2018 valued at Sh1.43 billion.

This indicates a growing local consumption of processed leather by upcoming cottage, small and medium enterprises that make leather articles for sale locally, regionally and across the globe.

Kenya has invested heavily in building a leather value chain — starting at the farm where pastoralists are being advised on proper animal husbandry to improve quality of leather to processing, which ensures availability of high quality leather for local use.

According to the latest Economic Survey, local artisans, medium and small enterprises’ demand for processed leather saw finished product exports rise by 4.1 percent against a 7.1 percent reduction in leather exports reported in 2017.

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During the same period, export prices for semi-processed (wet blue) leather fell 8.87 percent to Sh191 a kilogramme, cutting exporters’ earnings to Sh4.42 billion from Sh5 billion in 2017.

This resulted in leather processors selling raw materials to local products manufacturers who have been increasing production to meet demand.

Small and medium enterprises based at Kenya Industrial Estates last year received a Sh10.7 million government loan to enhance production as well as buy quality leather that results in quality products.

A planned mechanised common-leather facility at Old Kariokor market is nearing completion giving artisans access to industrial facilities that will see them improve quality of finished products at a minimal cost.

Old Kariokor currently produces about two million pairs of shoes and branded African sandals sold locally and exported to East and West African markets by road.

A 500-acre Kinanie Leather Park is also under development with commercial leather stakeholders invited to set up shop to process leather-products for export at the proposed special export processing zone.

The facility will have 15 tanneries next to leather products processing factories giving pastoralists a new market for their hides and skins.

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