FRENCH LEATHER INDUSTRY EXPORTS ARE IN GOOD HEALTH, UP 6.9% IN THE FIRST HALF OF 2016

September 16th, 2016

Sophie Marionnet
Sophie Marionnet
Credits: 
CNC/P&M

Leather Goods: Exports up 8% for the first half of 2016

Exports, worth some 2.9 billion euros, grew by 8% against 2015, with the trends varying greatly according to the country.

Hong Kong, the No. 1 customer for leather goods: exports up 12%

Hong Kong is France’s largest customer for leather goods. After a period of fluctuation, the sector has stabilised with an increase of 12%: at the same period in 2014, exports stood at 385 million euros, in 2015 exports represented 347 million euros, while in 2016 they reached 390 million euros. The drop in 2015 can be explained by the effects of the Chinese government’s efforts to crack down on corruption, which penalised the luxury market, a strong presence in Hong Kong. France is the second largest supplier of leather goods to Hong Kong, after China.

The United States, one of France’s loyal customers: exports up 5%

France has experienced constant growth in its exports to the United States. They grew by 29% between 2014 and 2015, and by 5% between 2015 and 2016. In value terms, 60% of items exported to the United States are handbags and 21% are small leather goods.

Singapore, the new outsider, a strong consumer of French bags: exports up 90%

For the first time, Singapore has entered the top three of leading customers. Sales almost doubled there between 2015 and 2016, increasing from 193 million euros to 367 million euros. The luxury industry is developing rapidly in the country and demand following suit:  53% of exports to Singapore are handbags and 30% are small leather goods, representing in value terms some 196 million euros and 110 million euros respectively. 

China, growing demand: exports up 11%

Export to China increased by 5% during the first half of 2015 and the first six months of 2015, and by 11% for the same period between 2015 and 2016. This growth is driven almost entirely by luxury articles. One quarter of the handbags exported by France worldwide, in volume terms, are leather handbags. With regard to China, this proportion stands at 80%, some 80.7 million individual items.

Sales to Japan have collapsed: exports are down by 46%

The second most important event of the first half of 2016 for the leather industry is the collapse of sales to Japan. In value terms, hand bags represent 56% of Japanese imports. They have dropped by 43% in value terms and 10% in volume. The average price of handbags exported to Japan was 241 euros in 2014, 332 euros in 2015 and 209 euros in 2016, which is 13% lower compared to 2014. Japanese purchases are currently oriented towards cheaper products. In 2015, 36% of exported handbags were made of leather but this dropped to 29% in 2016. The number of leather handbags exported fell by 28% whereas the number of handbags made from other materials remained the same as 2015.

Luxury bags are still in high demand internationally

A French handbag is exported with an average price of 373 euros. The average price is 233 euros for the European Union, but increases to 671 euros for China, 872 euros for Singapore and 903 euros for Hong Kong.

Shoes: Exports up 8% for the first half of 2016

French footwear has shown encouraging results thanks to the trend for sportswear. Exports have shot up by 8%, growing from 1.36 to 1.47 billion euros.

Sales within the European Union, which represents three-quarters of our exports in value terms, have increased by 13%. The number of pairs sold is the same as in 2015, some 47.9 million pairs, with an increase in the average transaction value of exported shoes. This increase is notably driven by shoes with leather uppers (not including slippers). 13 million pairs were exported, some 0.9 million fewer than in 2015 but with an equal value to the previous year. The average customs transaction value has risen by 7% and now stands at 56 euros. The fall in overseas sales of leather shoes (a 6% drop in volume) is affecting most of France’s main clients – Germany, Italy, Spain, Belgium, etc.

Sales of shoes with textile uppers (not including slippers) stood at 17.5 million pairs for a value of 382.5 million euros. They have increased sharply, by 14% in value terms and 26% in value. The increase of their average transaction value has been higher than that of leather shoes and stands at 11%.

At the same time, French production has fallen by 2.4% and revenue has shrunk by 5.5%. The drop in national demand is linked to the terrorist attacks, the poor weather and a generally difficult economic context.

Tanning: Exports up 6% for the first half of 2016

The leathers and finished hides sector has seen activity increase slightly. For French tanneries, the earlier part of the year appears to have been less difficult than in 2015.

The production of finished bovine leathers and finished ovine hides has enjoyed growth of 3.2% and 11.6% respectively. Exports grew by 6%. For finished bovine or ovine leathers, the situation is therefore much better than in 2015. Exports are taking off, increasing by 20% (53 million euros) and 10% (32 million euros) respectively.

The sales of finished bovine leathers are almost unchanged in the European Union (-0.7%). Sales to Tunisia, Morocco, China and Hong Kong have increased sharply by 2%, 36% (6.2 million euros in 2015 compared with 8.4 million euros in 2016), 28% (3.2 million euros in 2015 against 4.1 million euros in 2016), and 87% (2.2 million euros in 2015 against 4 million euros in 2016). It should be noted that France has a new customer: Bosnia – Herzegovina. France exports leathers to a value of 4.4 million euros to this country.

The climate is more delicate for finished calf leathers. Production and exports shrunk by 4% and 3% respectively. Exports of finished calf leathers grew by 6% in Italy, 5% in Spain, 10% in Morocco and 29% in Tunisia. But sales dropped by 25% to the United Kingdom (3.6 million euros in 2015 against 2.7 million euros in 2016), by 7% to Portugal, by 34% to the United States (1 million euros in 2015 compared with 0.7 million euros in 2016) and by 66% to Hong Kong (1.8 million euros in 2015 against 0.6 million euros in 2016). Globally, sales of finished calf leathers fell from 34.5 million euros in the first half of 2015 to 33.4 million euros in 2016.

 

Frank Boehly, President of the Conseil National du Cuir: "While the economic context in 2016 has not facilitated the sale of leather articles in France itself, the Made In France identity with its exceptional savoir-faire is still in high demand internationally, particularly in Asia.  We should encourage and develop this fact so that the French leather industry remains one of the largest in the world, to the benefit of all our industrial companies.”

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Le Conseil National du Cuir

The confederation brings together 21 federations and professional unions of the French leather industry, ranging from the farming of livestock through to the finished products.

The French leather industry

  • 12 800 businesses
  • 25 billion euro turnover, 
  • 133,000 people employed in the leather, tanning, footwear, leathergoods and glovemaking and leather goods retail industries.
  • One of the world leaders for finished calf leather and exotic leather
  • 3rd biggest exporter in the world of leathers and raw hides
  • 13th largest exporter of finished leathers
  • World No.3 for exports of leathergoods