There are a number of common features that make the area difficult. One is that hides and skins are essentially a by-product of the meat, dairy and wool industries. As a result, there is little incentive to take care of the product, to market it, or to take any action to improve the quality or to develop the market. Since farmers are usually not paid for the hide or skin at all (the price received refers just to carcase value) they see no direct relationship between what they supply animals to market, or direct to the abattoir for a price and the hide or skin. Under normal circumstances, there is no direct price or reward, and so the farmer will not normally be prepared to take action, or spend money to produce a better hide or skin, unless for some other purpose, such as protecting the health or welfare of his animals; or he may be forced to act for legislative or commercial reasons for example present animals to the abattoir in a clean condition for hygiene reasons.
Abattoirs, generally, are simply interested in selling meat, the initial objective is to obtain a price for the hide that is at least equivalent to the competitors. It is quite common, also, that hides and skins are sold by the abattoir on an average "all in" basis in other words, the same price is paid for all hides, whatever the quality. Since the market is very competitive an abattoir cannot afford to receive less for his hides than the next abattoir, because it may affect their competitiveness in the meat market it is quite likely that abattoirs of similar size will all receive the same price. The abattoir, therefore, will perceive no benefit from improving the quality of the hides or skins, unless the buyer pays him some form of incentive.
To compound this situation, it is impossible, at present, to assess fully the quality of a hide or skin until it is partly, or fully processed. First the hair or wool needs to be removed in order to assess anything less than very serious damage, and it is only after reaching the wet blue stage (pickle in sheep skins) that the important grain layer can be inspected. Even then, the leather needs to be dyed before the finer types of damage can be assessed. As has been said before, the quality of leather is defined by the absence of damage to the grain layer. A considerable amount of damage both parasitic and scratch damage is a result of skin reaction to attack. It is not the physical damage that causes the faults as much as the differential behaviour of the skin surface to process chemicals and dyes. This gives a result of darker or lighter areas over the leather surface such as light spot, which is associated with lice and fly infestation. In conclusion, since hide and skin quality cannot effectively be assessed in the simple raw form, it means that much more sophisticated buying and selling systems must be employed if quality is to be encouraged with some form of incentive.
There is, furthermore, the problem of bridging the gap between the tanner who can evaluate the quality of hides and skins, and the farmer who is in the best position to influence that quality. It is difficult for example, to persuade a farmer to use expensive chemicals or techniques if they do not receive any reward in return. Chemical insecticides raise a further problem, since while desirable from the point of view of effective control of parasites, they present both health and safety, and environmental challenges to the farmer, abattoir, hide trader and tanner..
A final problem is the commercial market situation. Prices for hides and skins are notoriously volatile. Because they are essentially by-products, the supply is price inelastic. In other words, for example, at time of shortage a modest price increase will not result in an increase in supply and so prices are liable to fluctuate quite violently, as buyers struggle to find enough material, or at times of surplus, suppliers have real difficulty finding anyone to buy. One result of this situation is that any incentives for improved quality may become quite insignificant in comparison with market price fluctuations. One generalisation would be that, overall, for most of the time there is a "sellers market" for hides and skins, and this means that it is very difficult for the buyers to instil any significant price/quality discipline into the market.
The philosophy behind the project is that there is enough potential benefit to everyone in the chain farmer, abattoir, hide trader and tanner in terms of potential added value, to make hide and skin quality improvement a worthwhile exercise. There is a need for greater co-operation between the links in the chain, rather than continuing to operate on an antagonistic buyer/seller basis. This co-operation may need some outside agency to help it develop, but the potential is there. Indeed it is possible to find examples of such co-operation on a company by company basis.
Therefore, there is a perceived potential benefit in terms of financial returns from increased value added to hides and skins through the chain, but this needs to be achieved, demonstrated and then effectively shared. There are other potential benefits, and some of these are more likely to encourage action by farmers and abattoirs.
There is a likely - but not generally proven - benefit in improvements in growth rates and milk yields from keeping animals free from ectoparasites. There is also an assumed animal welfare benefit. There are benefits to human health in minimising risks from zoonoses, and in avoiding hygiene problems which have the potential for disastrous consequences for the meat processor (for example E-coli contamination). Similarly, there are benefits in improving traceability of hides in order to assure the quality of by-products likely to enter the food chain (for example for gelatine manufacture).
All of these issues are potentially helpful in that they more direct rewards for actions that are also likely to help establish systems for improving hide and skin quality. The challenge, therefore, is to continue to encourage and develop these strategies. A great deal of work has been carried out, but as outlined above, the issues are complex and further development work needs to be undertaken to move further towards systems that are effective, economic and practical.
One of the main objectives of the was to develop a list of priorities for possible future research and development projects. Discussions during the project meetings outlined the following range of topics where it was judged that further work was required:
Further discussion at the project workshop, and during the final two project meetings identified four main areas as priorities - keeping hides clean, minimising parasite damage, hide and skin identification and evaluation of hide and skin quality incentive systems. These areas are all interrelated and overlap to some extent, but further progress is needed in each of the areas in order to develop a comprehensive approach to hide and skin quality. These four priority areas will be carried forward as proposals for future research projects and the following outlines set out an initial approach towards formal proposals.
Raw material quality is a prime concern of tanners the world over. The cost of raw material purchase accounts for approximately 60% of the total cost of leather production, yet it is the most difficult quality parameter to control. The hide is effectively a by-product of the meat industry and is often treated as such, resulting in poor leather quality with low value. Additionally, farmers are paid for the animal and frequently are not aware of the value of the hide as a product, thus actively discouraging any quality improvements on farm.
European tanners have developed markets for high quality, niche market products and cannot compete against countries with a lower cost base in the commodity markets. To supply leather into the niche markets requires a high quality raw material, with an intact and defect free grain surface.
There is a need for further investigation into the operating methods of delivering clean animals to the abattoir without damaging the hide or skin, optimum methods of minimising parasite damage to hides and skins, practical and economic methods of identifying hides and skins, and development and evaluation of quality improvement systems, in order to provide some incentive to farmers and/or abattoirs to reflect much more directly the quality and value of the hide in the price.
European cattle are typically housed over the winter period and frequently become covered in faecal contamination, leading to erosion of the grain enamel and subsequent downgrading. In addition, dung covered hides also represent increased cost to the tanner in the form of extended process times and increased effluent discharge. Farmers also may clip livestock prior to slaughter but this procedure may lead to cutting of the skin and again damaging the grain surface. It has also been demonstrated that animals slaughtered in a "dirty" condition lead to carcasses with high levels of bacteria that represent a hazard to human health.
The issue of contaminated hides and skins has been investigated with regard to meat hygiene and human health and has resulted in the establishment of a strict hygiene policy in the UK. However, the issue of hide and skin quality in relation to contamination has not been directly addressed and hygiene pressures may in fact lead to a further deterioration in hide and skin quality. It is essential to include quality in policy to avoid negative impacts to the leather sector and ultimately the farming and meat sectors as the price tanners are able to pay for low quality material decreases.
Solutions to the contamination issues must occur on farms and include:
The overall background to hide and skin damage and the growing need to focus on ways of improving quality applies equally here. Ectoparasites, along with the associated scratch damage to hides and skins are probably the biggest cause of damage to hides and skins. Some aspects of the causes, effects and treatments are well understood, while others are less so. There is still a considerable amount of further work to be done to establish an optimum, comprehensive treatment regime.
The main objective would be to develop recommended treatment/handling regimes, appropriate to the situation faced on the farm, to recommend a "best practice" and, if possible, to demonstrate other benefits to farmers - such as improved health, welfare and growth rates of cattle and sheep.
The potential for improving yields would be particularly helpful, if it were possible to demonstrate tangible benefits. The aspect of costs compared with potential incentives also needs careful investigation, along with the potential for using "cleaner technologies" - for example aiming to minimise the amount of chemicals/insecticides, and using husbandry practices to keep farms "parasite free" where this is possible. The use of selective breeding to develop resistance to some parasites is a longer term target. The wider impact of zoonoses (transmissible to man) is another aspect of potential incentives to keep animals clear of certain parasites (such as ringworm and ticks).
The main parasites to be addressed are lice, mange, demodex, ringworm, warble, and the sheep scab mite. In a project carried out by a consortium, the proposal would include a distribution of responsibilities allowing each partner to focus on one main type of parasite damage, or one aspect or approach to the issue - such as "cleaner technology" approaches, novel techniques, or assessing the potential for the "parasite free farm."
This project offers the opportunity to address hide quality issues in the European beef sector and develop a methodology of hide identification which will increase economic performance, whilst improving animal welfare.
The quality of bovine hides is defined by the absence of damage to the grain surface through which the hair fibres grow. This grain surface is visible only after the hide has been partially processed, with the hair being removed to reveal the surface. The tanner is therefore buying his raw material effectively without visible quality indications or origin available and no indication of how the material will perform when processed. This actively discourages quality payments and results in an low average price paid for hides of undefined quality from unknown sources. A clear need exists for a method of hide identification and traceability to enable to free flow of quality information from the tannery to the abattoir and farm. Currently, a barrier to this information flow exists due to the lack of a suitable identification method which makes communication along the chain difficult. This method will need to be robust to withstand the extremes of processing (pH ranging from 2-12) and remain intact during the splitting process (the horizontal cutting of hides to produce two separate pieces, grain and suede). A successful method of hide identification will also assist the access to the gelatin market for domestic material. The restriction on this material and thus, the inability to obtain a revenue for this by-product has reduced the intrinsic value of the hide. These products form an additional and important source of revenue for the European industry, including the farmer, processor and tanner, that would be facilitated by an effective means of hide identification and traceability.
The quality of the tanners raw material is affected directly by on-farm management and production methods, and to some extent, operations in the abattoir.. It is apparent from the degree of damage seen on partially processed bovine hides that these standards are currently inadequate for producing a consistently high quality raw material for the leather industry. If these standards were to be improved, hide quality would increase and result in an improvement in value of the hide and subsequent leather. This would add value along the chain, improving economic performance of all involved sectors - livestock, meat processing and leather.
The majority of raw material damage occurs on the farm during the lifetime of the bovine animal, as a result of environmental conditions during the rearing period. The principal causes of leather downgrading include damage caused by ectoparasites, more specifically lice, scratch, ringworm and dung contamination, all of which could be argued to constitute a welfare compromise. These faults are not visible on the hide due to the presence of the hair but, upon processing, become obvious, detracting from the appearance of the product and reducing both the value and the yield. However, due to the lack of a suitable traceability method, this quality information is lost in the tannery and so opportunity to feed data back to the farmer to enable improvement is not currently available.
The objective of this work would be to develop or validate - technically and commercially - a method of hide identification and traceability. This will enable hides to be traced through the processing chain and allow the feedback of quality related information to the beef farmer. It is anticipated that this information will form a basis for quality related payments based upon a yield of higher value, quality leather at the tannery. This in turn is expected to result in improvements in hide quality and a reduction in the level of damage and, thus, unnecessary loss in value for the whole carcass - he cost of unnecessary losses to the whole value chain, from farmer to tanner is estimated at £500 million in Europe. It will also reduce the requirement to import higher quality hides to fulfil the shortfall that currently exists and enable the added value to remain within domestic industry. Add to this potential increase in value of the gelatin and co-related products and the financial implications of hide traceability become apparent.
The chosen method will have the following ideal properties:
The method will be developed in collaboration with industrial and academic partners and evaluated at both experimental and commercial scale to assess suitability.
The background problem is very much the same as that outlined above - any sustainable system of hide and skin improvement needs to be capable of providing some benefit or incentive, through the market chain, to those who can influence the quality - mainly the farmers and the abattoir operators. Any system set up to address this needs to be practical, economic, robust and must be appropriate for the market conditions in which it is to operate. Clearly, hide and skin identification systems have a part to play in some cases, but they are not necessarily essential.
Although there are a number of examples of hide and skin quality systems working in different countries, most of the situations are unique and cannot simply be transplanted to another situation.
The main objectives in this area are to evaluate existing hide and skin quality/feedback systems and to assess the best approach in differing market situations in UK and Europe. Existing schemes - such as those operated in Australia, New Zealand, Sweden and Denmark are based on two main principles - identifying hides and skins through the chain, to allow feedback of information and, potentially payment of incentives; and assurance/endorsement of specified husbandry protocols which would be anticipated to minimise hide and skin damage.
Clearly, this approach would involve elements of all the other areas of work, but the most important aspect is matching a system to the market situation in each country and developing an appropriate recommended framework that can be expected to work in practice. No one scheme is likely to be appropriate for all situations since the numbers and ownership structure of farms, abattoirs, hide collectors and tanners will vary. Also, trade patterns will vary - for example a quality feedback system based on hide and skin identification would become much more difficult if a significant proportion of the material is exported for processing. In such a case, the farm assurance type approach is likely to be more practical. There is much more work to be done on possible systems in the bigger and more complex markets.