Leather sectors reject elimination of tariffs on exports of salted skins
Once again, the historical conflict between the segments that make up the leather chain in Argentina is reborn, due to a probable government measure that would substantially affect the operation of this market. This is the repeal of Resolution 537/92 that currently applies a 10% tariff to exports of salted hides.
The main sectors in conflict within the chain are: slaughterhouses and meat processing plants, tanneries, and the footwear and manufactured goods industries.
On the side of the former, they allege that having increased slaughter -in 2022 18.4% more than in 2021- and not having enough demand from local tanneries and industries, they suffer an accumulation of raw material, which entails a serious hygienic-sanitary problem.
For their part, the tanneries say they are overloaded with stocks and cannot afford new purchases. Meanwhile, the manufacturing industries are on alert before the eventual shortage of finished leather.
Interests come into conflict, when tanneries and industrialists of manufactured goods denounce that the opening of exports of salted leather without tariffs opens a fabulous business for some meat processing plants or "new companies" that with only commercial offices carry out exports, without the need for go through any tannery for industrialization.
For industrialists, this violates the principle of adding value to raw materials, preventing the creation of jobs in the country, and above all because of what the reprimarization of the economy means.
In this regard, they recall that allegation of the hero Manuel Belgrano in 1796: "Let's not export leather, let's export shoes".
The issue is still complex considering the characteristics of the different sectors that make up the value chain. The issue of productivity and volumes is put into discussion by the slaughterers before the industrialists, when pointing out their doubts regarding the capacity of industrial demand in relation to the total volume of leather production in Argentina.
At the time, the government used the argument that by freeing exports of salted skins, the price of meat would lower for the final consumer. According to the entities linked to the processing of salted leather, they assured that “this result was never obtained, and it will harm the tanneries and the value chain. The price of meat has nothing to do with leather, since it only represents 1.7%” of the price of cattle. Then they added that “fifty thousand jobs cannot be lost by going in search of an unverifiable and derisory decrease in the price of meat. Without work, without income, nobody goes to the supermarket”.
Later it states: "we request the Ministry of Economy of the Nation, that the announced measures not be put into effect, the consequences of doing so will be irreparable", concluded the document issued in mid-February 2023, entitled "DESTROY THE VALUE CHAIN OF LEATHER IS NOT FAIR" and signed by different sectoral chambers such as the Argentine Federation of Workers in the Leather and Related Industry (F.A.T.I.C.A.) - Union of Footwear Industry Workers of the Argentine Republic (U.T.I.C.R.A.) Chamber of the Argentine Tanning Industry ( C.I.C.A.) - Argentine Chamber of the Leather Manufacturing Industry (C.I.M.A.) - Tannery Association of the Province of Buenos Aires (A.C.U.B.A.) - Argentine Federation of the Footwear and Allied Industry (F.A.I.C.A.) - Tannery Workers Union of the Argentine Republic (S.O.C.R.A.) - Argentine Leather Manufacturing Union (S.A.M.C.) - Leather Goods Workers Union (S.O.M.) - Workers' Union of the Leather Industry (S.O.I.C.), Esperanza Province of Sta. Fe – Union of Employees, Foremen and Managers of the Leather Industry (S.E.C.E.I.C.) - Union of Workers of the Leather Industry (S.T.I.C., Province of Salta) – Union of Leather and Related Employees of La Rioja (S.E.C.A.La.R.) - Union of Leather Workers (S.T.I.C.) of Tucumán.
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