18 October, 2017 - 22 October, 2017
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24 October, 2017 - 27 October, 2017
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25 October, 2017 - 26 October, 2017
Domestic sales of leather footwear in Argentina has fallen by an estimated 30% since the beginning of 2017 compared with the corresponding period the prior year.
Alberto Sellaro, President, Argentina’s Chamber for the Footwear Industry (CIC), told local media that "beyond imported products, the problem is the domestic market". In 2015, the local industry is reported to have manufactured 125 million pairs of footwear, which dropped to 111 million pairs in 2016, while a total of 21 million pairs were imported in 2015 and 27.4 million pairs in 2016. "This year over 32 million imported pairs will enter the market and we expect to produce around 105 million pairs due to the fall in consumption”, said Sellaro.
In April, the Argentinian government is reported to have included footwear together with textiles within an agreement signed with employers and trade associations as part of a protection measure and incentives for the leather value chain. However, leather goods producers are said to have been left out of the agreement. According to Argentina’s Ministry of Production, it is difficult to advance in sectorial agreements since all parties involved demand cheaper inputs and sometimes one measure may benefit some but harm others, adding that technological investment is needed to adapt to changing demand.
According to the Ministry, the key for leather and footwear manufacturers is to boost sales in the domestic market, but much more is needed in terms of innovation, design and quality, especially as synthetic products are increasingly competing with leather.
In the beginning of 2017, Puma and Alpargatas are reported to have closed their manufacturing plants located in La Rioja and San Luis. Alpargatas is also said to have reduced production in its Florencio Varela factory and suspended 1,100 employees in the Aguilar, Tucumán unit.
In the first five months of 2017, imports of handbags grew 42% in volume, but the products are reported to be mainly composed of synthetic materials. However, even with a 35% tariff duty, imports in the segment are said to have increased 148% in volume. It is estimated that about 50 small-medium Argentinian enterprises operating in the sector have closed down since January 2016, representing 10% of the total with a loss of over 1,000 jobs.
Further upstream in the value chain, the tanning industry has also seen the number of cattle available for slaughter decrease, meaning fewer hides for the industry. The most profitable tanneries are said to focus on the export of finished and semi-finished leathers. Up to 2014, Argentina exported leather worth US$1 billion, while in 2016 exports totalled US$734 million, down -13% against the previous year according to Indec, Argentina’s National Statistical Institute.
Source: Clarincomments powered by Disqus