With livestock shopping at an all time low this Eid, leather manufacturer are feeling the heat

Economic downturns have meant people buying fewer animals on Eid. The effects have been wide ranging

Every year when Eid-al-Adha comes around, massive urban centers are all of a sudden bombarded with livestock. All year people in rural areas raise goats, sheep, cows, and camels for sacrifice on Eid, and around two weeks before the religious festival, they bring their animals to the cities to sell them. What kind of sacrificial animal you buy, what its colour is, what it’s breed is, and where it is from all factor in the price – and since these sacrificial beasts are a bonafide status symbol the prices they fetch can be astronomical. 

The economics behind livestock buying and selling on Eid are fascinating. Around 250,000 to 300,000 animals make it to the main animal market of Karachi that is spread over 900 acres of land, slightly bigger than Central Park in Manhattan, and about eight times bigger than Vatican City, the smallest country in the world by land area. 

And it is not just the rich who splurge on buying expensive animals during Eid-ul-Azha. Many middle class buyers save money for the whole year to buy a sacrificial animal of their choice, often forgoing other purchases in order to be able to buy an expensive animal during that time of the year. Social prestige, combined with perceived religiosity are a powerful motivator for many people, though others perceive it as the best way to fulfil what they consider a religious obligation.

But for the past few years, this economic activity has seen a serious dip. This year and the year before that can easily be attributed to the coronavirus pandemic, and people having less money to buy cattle as well as being not as willing to go to crowded marketplaces. However, the trend has been seen since before the pandemic as well. 

Back in 2019, the PBIF forecasted up to a 40% drop in Eid-related economic activity in 2019 compared to the previous year. The main reason: the wide economic slowdown is likely to impact people’s spending on what is still largely viewed by many buyers as a discretionary item of spending. Add to this the realities that came with lockdowns and mass unemployment after the coronavirus pandemic, and you have even worse conditions. Along with this, naturally, one market that has been affected is leather. 

The leather market and Eid 

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Everyone has seen how big the kerfuffle over hides is after Eid-ul-Adha. Well before the Islamic festival that honours sacrifice has even begun, NGOs, government bodies, charities and political parties are all out to collect the hides of the sacrificial animals that are supposed to be given away as charity.

We have all been through it, from the catchy slogans like “Sacrifice for God, hides for Shaukat Khanum” by charity organisations to the less attractive threats of certain political parties in certain cities [yes, we are talking about the MQM in Karachi], the hides business is a free for all, since the raw product is essentially being given away for free. It is all a question of who can collect them, and how cheaply leather manufacturers can buy them. And the leather industry waits with bated breath every year for Eid, because this is one of the reasons Pakistan’s leather is so good. Livestock reared for meat and hides is usually small, and thus gives smaller hides. The animals bought and sacrificed for Eid are bred for beauty and size, which ends up meaning that the hides are of a greater size and quality, both of which are desirable for leather production. The price of hides depends on the demand and supply in the market. The prices of sacrificial animal hides were high seven or eight years ago but are now very low. This situation is not only in Pakistan, but also in the international market.

Recently, as the number of sacrificial animals in Pakistan is declining every year, the trend of collecting skins is decreasing every year as compared to the past, whereas in the past, besides religious parties, charities and madrassas, campaigned to collect skins. Every effort was made to collect the skins and then sell them to raise capital. The race to collect skins was so intense that in the country’s largest city, Karachi, skins were snatched from each other and shootings erupted against each other on the basis of such incidents. People associated with Pakistan’s leather industry were already predicting a reduction in sacrifice and skins this year. 

Why is the number of sacrifices in Pakistan declining every year and why is the practice of collecting sacrificial skins declining? In this regard, Profit has approached people ranging from cattle sellers to people associated with the leather industry, from which it is not difficult to predict that the leather industry will not be able to benefit much from this festival in the years to come.

Why were the sacrificial animals expensive this time?

Pakistani leather manufacturers have a bit of a chip on their shoulders. Generally, when you think leather, you think Italy, not Pakistan. Italian leather, like Italian sports cars or suits, screams luxury. Other than the quality of the product, the idea of wearing shoes or having a belt or a wallet made of Italian leather comes with a certain oomph factor. Which is why, perhaps, every businessman involved in the leather industry in Pakistan is constantly raving about how Pakistan produces the best quality leather after Italy. The claim, which sounds like a tall one at first, is not without substance. Sporting leather apparel from Pakistan may not have the same appeal and brand equity that its Italian competitor does, but leather products from Pakistan constantly hold up their own quality wise on the global market.

For starters, most of the leather produced here is vat-dyed instead of the spray-dyed stuff that is more commonly available, which means it keeps its colour for longer. The frequency with which American bikers and biking enthusiasts on Harley Davidson forums extol the virtues and affordability of Pakistani leather is amusingly high. And if you egg local manufacturers on enough, they will eventually break and say their leather is the best in the world, and the Italians are simply getting by on brand value. 

Unsurprisingly enough, since it is a rare quality product that Pakistan is capable of producing, it is one of our top exports. The second largest export oriented industry in the country, Pakistan is not even among the top 10 leather producing countries in the world, but its product does offer high quality.

But as we have mentioned earlier in this article, this high quality leather is only possible largely because of the high quality animal hides collected every Eid. And if Eid cattle shopping declines, there will be less Pakistani leather to go around – and already it is barely enough to be an important player on the international market. So why are fewer animals being sacrificed on Eid? 

Shafqat Qadri, a sacrificial animal trader at Lahore’s renowned cattle market, Shahpur Kanjran, said he had bought animals from different villages across Pakistan in the market and many animals had to be sent back because this time there were more sacrificial animals in the markets and fewer buyers.

“This situation is not only on Eid days but also on normal days. Customers are less likely to go to the markets. I have collected sacrificial animals from different villages in South Punjab and Khyber Pakhtunkhwa and taken more than a hundred animals. Now that the prices of mutton and beef had gone up before Eid, the prices of traders in the market were skyrocketing. Another reason for the rise in livestock prices was that traders had to work hard to get stalls in cattle markets and had to pay bribes to market staff to get stalls. The daily rent of a 30-by-30-meter stall in the market was more than RS 20,000. Now think for yourself that the merchants had to cover their expenses by selling the animals. Now when the price of the animal is increased for these expenses, the customer goes back to the market without buying the animal,” he said.

Mudassar Yaseen, who hails from the Punjab town of Arifwala used to bring sacrificial animals to the Lahore market every year on the occasion of Eid. He informed Profit that the increase in mutton and beef rates and market stall prices were just two of the reasons for the increase in the price of an animal, but despite all these reasons the prices of sacrificial animals were unrealistic.

“Now the thing to consider is that if traders buy animals from the villages at cheap prices, then why do they sell animals at high prices in the market, then the answer is clear as the pricing of any animal takes into account the cost of transport, fodder, stalls and the risk of loss. For example, we pay between 18,000 to 22,000 rupees for a goat that weighs between 30 kg to 35 kg. Simply put, we offer a live goat rate of RS 500 per kg, similarly, the rate of sheep is 400 to 450 per kg and we offer RS 300 per kg for live lamb. Sometimes we buy these animals by weight and sometimes we estimate the weight of the animal from our own experience. However, using your experience can sometimes be very rewarding,” he explains.  

“Secondly, by looking at the age of the animal, it is also estimated how much weight gain is possible if the animal is bought one month before Eid and given a good diet and that, too, is likely to pay off. However, we do not offer more than Rs 200 per kg for a live ox or a cow and the purchase of a large animal is mostly done by guessing because it is a difficult task to weigh them and the villages do not have such large scales.” 

“In order to bring these animals into the city, you have to understand that the pockets of the traffic and police personnel standing at most of the nooks and crannies have to be heated and then we have to pay huge bribes to get stalls in the market and then we are in a position to do business.  Now, for example, if we have bought animals worth Rs 1 million, then bringing them to the market and selling them till the day of Eid would also cost us RS 300,000. Now let’s turn to the customer, the customer did not find a goat weighing 25 kg in the market this time for less than RS 40,000. If anyone outside the market has managed to buy a goat of this weight at a low price, he is lucky. Now the trader has bought the same goat for RS 500 per kg and he kept trying to get double profit on it which was wrong practice and this practice is done every year on the occasion of Eid. The same is true with the prices of cows, oxen, sheep and lambs. That is, traders try to sell animals at twice the price of their purchase.” 

“Now the rich customer’s pocket allows him to buy an expensive animal but the common man easily realizes that the trader is demanding more money for the animal in terms of height, age and weight. This year, under the pretext of rising prices of beef and mutton, traders sold animals at higher prices, but this time more animals were also sent back than last year. Now it is up to the government and the price control committees to think that the lower the number of sacrifices, the greater the impact on the economic circle. The solution, in my opinion, is for the government to fix the prices of live animals in the markets according to their color, breed, type and weight. For example, if the government fixes the rate of live goat at RS 700 per kg and if this rate is implemented in the cattle markets, the number of sacrifices will also increase significantly and all related businesses will also prosper. To do so, the government will have to take all small and large livestock farmers into the loop, and this is not a difficult task, as many livestock farms sell the sacrificial animal at a reasonable price each year by weighing the live animal,” Yaseen suggested.

What was the number of sacrifices this time?

An official of the Pakistan Tanners Association (PTA) told Profit that more than 25 million animals have been sacrificed in Pakistan in the last three years. Taken as a whole, these sacrificed animals include more or less 8 million cows, about 10 million goats and 2.6 million sheep and 100,000 camels.

“Similarly, in the year 2020, as many as 2 million cows, 3.14 million goats, 800,000 sheep and 60,000 camels were sacrificed. If we take a look at the previous year 2019, a total of 3 million cows, 4 million goats, 1 million sheep and 100,000 camels were sacrificed, while in 2018, approximately 2.6 million cows, 3 million goats, 5,000 camels and 300,000 lambs were sacrificed,” said the official.

They added that 2 million to 2.2 million cows had been sacrificed across the country this year, while 5.5 to 6 million goats and sheep had been slaughtered. “Similarly, 100,000 camels were sacrificed. If we talk about Lahore, about 0.45 million cows were sacrificed and 5.5 to 6 million sheep and goats were slaughtered and inflation led to 20 percent fewer sacrifices than last year,” he said.

On the other hand Ejaz Ahmed Sheikh, a member of the core committee and managing committee of the PTA, told Profit that the economic impact of the Covid-19 pandemic and inflation have broken the backs of citizens, as a result, there was already a trend of 10-15 percent reduction in the nationwide sacrificial this year.

Tanneries receive 95 percent of the skins of sacrificial animals, which makes the annual sacrifice statistics clear. The leather industry, like other industries, is suffering due to the economic impact of the Covid-19. The number of raw hides on Eid-ul-Adha this year was already expected to decrease by 10 to 15 percent. However, the price of skins has increased slightly compared to last year.

“This year, cow skins were bought for Rs 700, goat skins were bought for Rs 200 and sheep skins for Rs 100. However, last year, cow skins were bought for Rs 500 to Rs 600, goat skins for sS 125 to 150 and sheep skins for Rs 25 to 35. In three years, the number of skins fell from 11 million to 8 to 8.5 million last year, while this year the number is expected to fall further to 6 to 7 million,” he informed. Because there are fewer skins, the prices have increased. This means that tanneries are now producing less leather at a higher cost, making the business all the more difficult. 

Complications of leather production

There is a lot more to the treatment of these hides than meets the eye. For example, whether it is the hide of a sacrificial animal or a routine animal, there are three steps to converting it into usable leather that determine its value. One stage is the hide itself, the other stage is the chemical used on the hide and the third is the labor cost of the process. Clumsy butchers, due to their negligence, make cuts on the hide and with one cut; the A-plus hide becomes category A. While two cuts put it in B category and three cuts put it in C category. “For the common man, these seem to be small cuts, but for us, the cut hide becomes useless. Garment patterns cannot be formed on the cut hide,” said one manufacturer.

Usman Malik, owner of a tannery in Sialkot, informed Profit that there are many stages in the manufacturing of leather through which leather is prepared as required and many chemicals are used for it. “Cows, buffaloes, camels, goats, sheep and lambs are slaughtered and their skins are peeled off and salt is added to them for short periods of time so that they do not stink. Once salted, it can be stored for up to a month. The skins are then soaked in sodium sulfate and lime and kept in large ponds for four days so that the skin becomes soft and the hair separates from it. Then it is washed in open water and its peeling is done skillfully with very sharp tools,” he explains. 

Because this is skilled labour, the wages are also higher, making it a more expensive business to be in. And since the Pakistani leather industry is trying to frame itself as a luxury leather producer of quality rather than quantity, they have to use top of the line products and chemicals to maintain their standards. “Workers skillfully clean the skin by separating unnecessary ingredients and it is then poured into large wooden drums and washed thoroughly in open water with fertilizer bisulfate, chemical bat and only soap etc. After about four hours of washing, the effect of the first chemical disappears. After which salt, sulfuric acid, sodium phosphate and other chemicals are mixed in the same drum and activated for about 4 to 5 hours to strengthen the skin,” adds Usman. 

“The finished skin is bleached through various chemical processes and the skin can be bleached for up to three years with the use of petrochemicals. In the next and final steps, leather sheets are made to order and then it is dyed according to the order. It is then dried on large plates and temporarily glued to the chemical. After drying, it is buffed and finally, it is sprayed for polish and gloss and finished. Now that we have bought the skins from the leather markets, we leave the entire process of preparation to the contractors. From the leather market to the leather finishing, the products made from it and the demand and supply in its market, we are paying the price of the skins keeping in view our business because export orders in our industry have been reduced due to artificial leather and the price of a leather product is a bit expensive anyway, the common man does not touch it quickly.” 

However, an employee working in a tannery in Sialkot, on condition of anonymity, informed Profit that although thousands of people are employed in the leather industry, people still work here for low wages. “Leather workers suffer from various diseases, especially young children who are afflicted with various diseases. This is because the tannery owners have contracted out all the stages of leather manufacturing and the contractor prefers to work with young children in the lure of maximum savings. There are no restrictions on child labor laws in these areas,” they said. 

“The owners have put up signs saying that their tanneries do not employ anyone under the age of 16, while dozens of minors are employed by them. The tannery owners say that these children are not their employees but the employees of the contractor and acquit themselves. Most tanneries do not have the number of employees on the leave form to avoid the rules of paying monthly salary and 8 hours working hours as per government rules. There are no fire extinguishers or emergency evacuation arrangements.” 

Why are fewer skins being collected? 

Already there are fewer sacrifices taking place, and on top of that, fewer skins are being collected from the ones that are available than normally would. The Edhi Foundation, a leading name in the field of welfare services, also ran a nationwide campaign to collect skins, but this has almost disappeared since the death of its founder, Abdul Sattar Edhi. Saad Edhi, a spokesman for the Edhi Foundation, said that when the skins were collected six or seven years ago, the price of cow skins ranged from RS 4,000 to RS 5,000 and goat skins were sold for RS 1,500.

“Now that we have issued the tender, the highest bid for the big skin was RS 450. If a skin sells for RS450, the resources spent on collecting the skins are not met, on the contrary, we have to bear the loss. We don’t run campaigns anymore, but if we get a call from four or five houses in an area, we go and get the skins. Pakistan’s biggest buyer of leather is Europe, but being on the FATF gray list has led to a decline in exports, so leather buyers have also shown a lack of interest in investing. That is why the prices of skins have come down,” he informed.

Maulana of a Madrassa near Lahore Raja Market informed this scribe that it was true that the price of skins has come down a lot so now the madrassas have started collecting skins locally.

“When volunteers from charities organizations do not come to pick up skins, people donate skins to madrassas at the local level. Although these skins do not provide the madrassas with the resources they need, it is better to get something without trying. In the same way, people are now turning their attention back to the poor and needy in their areas,” he said.

Shahab Omer
The writer is a member of the staff and can be reached on [email protected]

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