Why B'Baria shoe factories incurred losses this Eid

Making 500 to 600 pairs of shoes daily ahead of Eid was a usual scene for Shafiqul Islam and two of his associates working at Seven Star PU Footwear factory in Brahmanbaria's Pirbari. However, things are drastically different this time.

Brahmanbaria's shoe industry is facing a sombre Eid season as factories recently struggled with delays in polyurethane (PU) chemical imports from China, making them unable to grab the Eid market, which is a lifeline for shoe manufacturers in the district.

Though supply of the chemical has resumed, owners resorted to reducing production by half, which has left workers with no scope of earning any additional income as they are unable to work overtime.

Talking to this correspondent, Shafiqul recalled that he and two of his associates barely had time to breathe from Shab-e-Barat till the 20th day of Ramadan even last year due to the added pressure of making shoes. 

"This year however, though regular work is going on, it's almost as if we are sitting idle. We are unable to work to our full potential because the owners have cut back on production as the chemical that was needed for making outsoles arrived late," he said.

"So, this Eid, we have no scope of any additional income," he added.

Roman Mia, another worker at the same factory, voiced the same concerns while talking about the crucial role of PU chemical in shoe production.

"The chemical is what keeps the machines running and as long as they are operational, we have work. But because of this delay, the little hope we had for some extra income is now gone. I am worried if I will be able to celebrate this Eid with my family," he said.

According to stakeholders, this delay has crippled production across all factories, resulting in substantial losses as owners have struggled to fulfil orders amidst the crisis.

Traditionally, the shoe trade in Brahmanbaria revolves around the two Eids - Eid-ul-Fitr and Eid-ul-Azha. Factory owners rely heavily on Eid sales to make up for the losses incurred during other periods. 

Last year alone, the factories made sales of about Tk12 crore during Eid-ul-Fitr. Workers, on the other hand, seize this opportunity (Eid season) to earn extra by fulfilling orders tirelessly, often by foregoing sleep.

The shoe industry in Brahmanbaria dates back to 1963. Currently, it has a total of 80 factories with over 3,000 workers actively working in them. Of these, at least 26 use machinery for shoe manufacturing. 

During the Eid season, the larger factories produce a minimum of one lakh pairs of shoes daily. Popular for their affordability and quality, the shoes are in demand not only within the district but also in other regions, including Dhaka. The large factories sell shoes in the market to the tune of Tk50 to Tk60 lakh each Eid, while smaller ones make sales of about Tk10 to Tk12 lakh. 

However, this year painted a grim picture. 

According to the stakeholders, the shoe factories grappled with severe shortages of PU chemicals that led to disruptions in shoe production for approximately three weeks after Shab-e-Barat and the consignments of chemicals that were imported by traders from China were stuck at Chittagong port for lab tests.

The PU chemical is basically used for making outsoles for shoes. So when the chemical reached the factories after the 10th of Ramadan, by then the window to cater to the Eid market demand had already closed.

The crisis has also led to a surge in chemical prices, escalating from Tk280 to Tk300 per litre last year to an exorbitant Tk400. 

The factory owners were later compelled to reduce production by half even though the supply of the chemical started to become normal. 

Now, since there are not many orders from wholesale buyers, major factories now produce shoes worth only Tk50,000 to Tk60,000 daily, less than half compared to last year. Similarly, smaller factories are now producing shoes worth Tk5 to Tk7 lakh for the entire season.

Talking about the crisis, Md Nadeem, a factory owner, said he had to reduce the production of shoes to minimise losses as the Eid demand period had already passed. "Moreover, I had to buy the PU chemical at a higher price because of its sudden increase in demand. Now, I fear that I will incur a loss of about Tk20 lakh.  

Rakibul Islam, owner of Active PO Footwear, said, "The factories usually start making shoes after Shab-e-Barat and continue till the 25th day of Ramadan. During this time, we receive orders amounting to Tk1 lakh each day.

"But this time, since production of shoes started after 10th Ramadan, we are receiving orders worth only Tk50,000 each day. If there had been no delay in chemical import and we were able to grab the Eid market, it would have been a business of at least half a crore taka this time."

When asked about the issues, Brahmanbaria PO Footwear Association General Secretary Md Hanif said, "As the chemical was stuck at Chittagong port for lab tests at a prime time of business, we cannot avoid the loss. Each factory is likely to incur a loss of Tk20 to Tk 25 lakh."

Replying to a query, Chattogram Customs House Chemical Assistant Helal Hasan told TBS that at least 100 samples of PU chemical undergo routine examinations at the chemical laboratory of the Customs House every day. "However, due to a shortage of manpower in the labs, it took around two weeks to complete the reports for the tested samples. Moreover, processing reports for products that are subject to provisional duty takes a longer time," he added.