Luxury products made with leather have become increasingly expensive as U.S. hide prices more than quadrupled over the past five years, with no signs of a stopping. CCTV’s Hendrik Sybrandy reported this story from the LaSalle, Colorado.
Quadrupling of leather prices attributed to more demand, less supplyLuxury products made with leather have become increasingly expensive as U.S. hide prices more than quadrupled over the past five years, with no signs of a stopping. CCTV's Hendrik Sybrandy reported this story from the LaSalle, Colorado.
“The cattle prices are record high. It’s been a very strong industry now for about a year, year and a half. People have done pretty well. These prices taking off like they did, it’s been very lucrative, record profits,” Dan Timmerman, co-owner of the J.A. Timmerman Cattle Company, said.
Leather goods maker Harry Barth, the owner of Twin Peaks Leather, said that he paid $2.35 for a square foot of buffalo in 2008, and now he pays upwards of $7.85 per square foot.
The reason for the rise in prices is simple supply and demand, experts said. Several years of drought have forced ranchers to sell off cattle they couldn’t feed. Many ranchers have also retired or left the business.
“If there’s a shortage of beef, shortage of cattle, obviously there’s a shortage of leather,” Timmerman said.
At the same time, a growing worldwide middle class is looking to buy more leather furniture, handbags, shoes, and cars upholstered in leather. It’s estimated that U.S. consumers will spend $21 billion on leather goods this year.
Barth, who blames increased regulation of leather tanneries for the higher cost of his hides, says the lure of fake leather products has forced him to accept smaller profits on his merchandise.
Scott Rothbort of Lakeview Asset Management discusses leather, luxury goods
CCTV America interviewed Scott Rothbort, President of Lakeview Asset Management, about the rise in leather prices.