1. Product Description: There two types of tanned leather- vegetable tanned and basic chrome tanned produced by using vegetable extracts and basic chrome sulphate respectively. According to leather experts, chrome tanned leather is soft, supple, strong and permeable to air. This type of leather is extensively used for making finished leather goods like sports goods and shoe uppers.
2. Rationale: The Amhara region had the second highest number of cattle, sheep and goats in the country. In 2005/06, this number was estimated to be about 22.5 million. Out of this livestock resource, about 1.8 million hides and skins are harvested every year. Practically all this resource is sold to merchants in Addis Ababa where it is processed in the leather and shoes industry or where it is exported in raw or semi- processed form. Any raw material will bring more income to the area where it is grown or produced if it is further processed in that area. That is why the Region’s resource must be further processed in the Region so that more financial resources could flow to the region. The will increase the income of producers and processors.
3. Market Potential: As there has been domestic and foreign markets for the hides and skins produced in the region, so there will be market (at home and abroad) for tanned leather to be produced in the region.
4. Source of Raw Material: Of the 1.8 million pieces of hides and skins produced from the region, at least some portion of it will be supplied to this project if it materializes.
5. Production Process & Technology: Socking the raw hides and skins in large quantity of water, liming with lime and sodium sulphide in paddle; deodorized and fleshed in machines to produce pelt. The pelts are now washed thoroughly and delimed in a 2 percent ammonium sulphate solution, pickling in 8 percent sodium chloricde and 1.5 percent sulphuric acid using drums is the next operation. For producing chromed tanned wet blue leather is treated with 10 per cent basic chrome solution in the picking bath. Main machinery and equipment include twin paddle, tanning drum, “unhairing” machine, fleshing machine, and accessories.
6. Estimated Investment: To process about 80,000 pieces of hides and skins, the investment requirement will be; Building 400 m2 at Birr 1500/m2 Birr 600,000; plant and machinery – Birr 510,000; Total Birr 1,110,000.
7. Benefits: Forms the basis for developing leather industry in the region, brings additional income to the region, stimulates the development of the livestock sector, earns foreign exchange if the tanned leather is exported introduces new skills and technology to the region.
8. Location: Plant will be small scale, and a number of small plants could be established in two or three zonal capitals.