Foot and mouth disease: Low automotive demand ‘a blessing’

Pretoria, Gauteng, SA – “Obviously FMD has an effect, you only have to look at the meat prices to see that,” said Gerrie de Jager, MD of Brits Leather Group’s Rosslyn Tannery. “All the red tape and protocols for biosecurity associated with FMD add further costs to a stressed market.

“Fortunately, the State Veterinary Department has adjusted the protocols around hides from FMD vaccinated cattle allowing us to process hides from cattle slaughtered at sterilized, approved abattoirs (cattle free of FMD and vaccinated) with strict biosecurity measures which keep the risk to a minimum. Also, FMD is pH sensitive, and the high pH liming process kills the virus if it’s present. So we can continue with production.

“In my opinion, the slaughter has dropped, probably due to smaller producers slaughtering out their herds due to the risk of FMD. That has caused meat price to skyrocket.

“From a hide point of view, it’s quite fortunate that the current leather demand from European automotive OEMs is down. That unfortunately doesn’t help a tannery which has budgeted for production of, for example, 40 000 hides and only gets 20 000 to produce – yes, you can reduce some of your costs, but not all of them. In our case, we fortunately had hides in stock to process.”

He said there is some demand for leather from Europe for footwear and certain leather goods.

“This is good business, but it’s very competitive. If you get orders you have to give the best service and terms. We are blessed to have a healthy orderbook.”

He said hide prices are relatively stable “but selling prices are very competitive locally and Internationally”.