A new issue of our Market Intelligence newsletter went live on July 30. The full document is available at this link. By Leatherbiz.

With the start of the holiday season in the northern hemisphere, activity along the leather pipeline there is slowing significantly. Market Intelligence points out that this means there is little prospect of change in the short term to a situation of slow demand and reduced production in Europe.

It reminded readers of a point it has made in previous publications, that there is overcapacity in the leather industry in Europe now.

However, this time it goes on to say that there are challenges in China too, particularly in the north.

Smaller-scale leather production facilities in the provinces of Hebei and Shandong, which are heavily focused on producing furniture leather, are also “suffering from overcapacity at the moment”, according to the report.

“Local demand for leather in China is currently not sufficient to use up production capacity,” it says. “This has led to an increase in stock levels in recent months, not only in the production facilities in the northern provinces, but also at the intermediaries for semi-finished products and finished leathers.”

The lack of international demand for leather, but especially for finished products such as furniture, is playing a decisive role, Market Intelligence says.