Leather firms cash in on falling exports

The price of semi-processed (wet blue) leather fell 8.87 percent to Sh191 a kilogramme, cutting exporters’ earnings to Sh4.42 billion from Sh5 billion in 2017.

This provided high quality leather to local article manufacturers leading to a 4.1 percent rise in finished product exports against a 7.1 percent reduction reported in 2017.

The Economic Survey 2019 shows last year’s positive performance in leather value addition ventures was enhanced by a Sh10.7 million government loan to small and medium enterprises based at Kenya Industrial Estates.

“This growth was occasioned by increased production of finished leather and shoes with uppers (above sole) of leather,” it said.

Leather is among Jubilee government flagship subsectors earmarked for support due to its labour-intensive nature that benefits all across the value chain. A major investment is expected at the 500-acre Kinanie Leather Park, an export processing zone currently under development in Machakos County.

Quality products

Old Kariokor Market is also receiving support for establishment of a mechanised common-leather facility that will improve processing to high quality products.

This will mechanise shoe production increasing annual volumes from two million pair of shoes to 10 million thereby enabling Kariokor shoemakers supply existing markets in Kenya, across east and West Africa.

Stakeholders have for decades lamented lack of quality leather adversely affecting production of finished products for the local and export markets. This has seen Kenya’s best quality leather exported with 2014 witnessing the highest outflows at 26,212 tonnes worth Sh7.6 billion.

Leather product manufacturers are also benefiting from the Build Kenya Buy Kenya Initiative where the government slapped a ban on import of leather products for the disciplined forces and ordered tenders be awarded local shoe industries.