The view of Giancarlo Betto who deals in raw hides

Federpellami is a firm in Santa Croce specialized in selling raw butts in particular for Italian production of soles and belts, that can also count on a branch in Poland that deals in whole hides and since recently also in marketing wet-blue destined for Southeast Asia. We asked Giancarlo Betto, seeing his long experience in buying and selling raw hides, to help us understand
the current market situation.

– How was 2013 for you?

Last year was positive, it’s now the clouds are starting to gather with a drop in demand. In general conditions are getting worse: on one hand it is hard to find hides and on the other we find increasing difficulties in receiving payments and with always narrower margins.

– Prices have remained high and there is some talk of speculation. Do you agree?

Absolutely not, the rises are connected with a long term trend due to various factors. The major one is a drop in meat consumption, explained both by the economic crisis and general alarm concerning possible health risks. Even the Americans who are traditionally big meat eaters and have greater spending power, have reduced their consumption: last year they bought 1.7% less red meat. This might sound quite a small percentage but in big numbers it means thousands of fewer hides on the market compared to the previous year. In Europe the decline was even heavier. Then, cattle breeders no longer find their work remunerative. The whole chain suffers…

– Do you think prices can drop in the near future?

This is not to be expected. Insufficient supply compared to demand mathematically translates into progressive increase. Many tanners are falling back on hides of lower quality or less expensive provenance. Some manufacturers are obliged to turn to other materials.

– Some experts maintain that in future leather will become exclusive to the luxury segment. Do you agree?

I would say this could be the case seeing the growing scarcity of raw material.

– How are trends in outlet sectors at present?

Car interiors is doing very well but furnishing sees a slight decrease. Soles are only for women’s luxury footwear and even leather for uppers is declining although this is still the major consumer sector. Leather goods are doing decidedly better.

– Which are the best markets today?

Asia continues to be important in the general picture even if it is slowing down a little, while in my opinion the Chinese are having problems paying, just like the Europeans.