Sep 18, 2019
Hide, Skin and Leather Get Their Own Traceability Program in the US
When forest fires raged in Brazil this summer, pressure mounted for brands that source leather and beef to avoid the Amazon. But many food and apparel companies buy from processors and have little visibility into the ranches where cattle are raised. To help ensure better visibility for US cattle the USHSLA (U.S. Hide, Skin and Leather Association) recently started a traceability program. Sourcemap recently had the chance to catch up with the USHSLA’s president, Stephen Sothmann, to better understand the program and how it will enable supply chain transparency for the leather industry.
Please tell us about your industry organization - when it was founded, who its members are, what projects and activities you oversee.
The U.S. Hide, Skin and Leather Association (USHSLA) is a full-service industry trade organization focused on representing the interests of the U.S. hides, skins and wet blue leather products industry. Its members include meat packing companies, hide and skins processors, traders, exporters, and other related organizations. Founded in 1979 and headquartered in Washington DC, the association provides its members with government, public relations, and international trade assistance and support. The U.S. hides and skins industry is one of the largest raw materials suppliers to the global leather industry worth nearly $2 billion in value annually. USHSLA is a cooperator organization under the U.S. Department of Agriculture’s foreign market development programs, with a primary mission to promote the export of these agricultural products to the global leather and leather products industry.
Recently, the USHSLA announced an organizational merger with the Leather Industries of America (LIA), a sister organization in the U.S. leather industry. As of January 1, 2020 the newly merged organization will be known as the Leather and Hide Council of America (LHCA). Once the merger is finalized, the LHCA will be the leading voice in the U.S. and abroad for all issues pertaining to the hides, leather and leather products industry globally.
How have this summer's fires in the Amazon affected you and the industry in general?
The Amazon is an incredibly valuable resource to our planet, and the U.S. hides and leather industry opposes any actions that would jeopardize its health. While the U.S. industry has not been directly affected by the issue, we are concerned about the impact it may have on leather utilization and consumption overall. Unfortunately, some groups and organizations have chosen to use this issue to unfairly attack or demonize all global leather production, regardless of how and where it is produced in the world. I am not an expert on the issue, but from what I understand there has been a lot of time, money and effort by good companies and players in the leather industry in South America to avoid or mitigate any damage to the Amazon biome. Those companies should be supported in their efforts. Unfair attacks on the leather industry as a whole will not help resolve the underlying problems.
USHSLA has a new traceability program. Can you tell us what inspired the program and how it works?
USHSLA has been developing the recently announced Hides and Skins Traceability Program for several years and we are very excited that it is now live. The inspiration for the program was to set up a flexible, industry-led program that meets the growing needs and desire from our downstream customers, including brands, retailers and consumers, to understand where their hides and skins products originate. We think we have a pretty good story to tell in the U.S. about our production and business practices, so we are very happy to share it via programs like this.
How does it work?
USHSLA has contracted with the U.S. Department of Agriculture’s Agricultural Market Service (AMS) to conduct independent audits to certify the origin of U.S. hides and skins back to a single, identifiable facility where it was produced– either a specific meat packing plant or a regional hide/skin processing facility. All hides and skins produced in the U.S. are eligible to be certified under the program. AMS auditors will confirm, via physical onsite inspection, that a U.S. supplier has adequate procedures, internal controls and record-keeping methods in place to ensure the hides and skins it sells originate from a single, identifiable facility of origin.
Once a facility has been certified to meet one of the traceability standards under the program, USDA AMS will list the name, contact information and program certification of the facility on a public AMS website. In addition, USHSLA will list the facility, program certification and specific product offer information on its website with the contact information of the U.S. supplier. The role of AMS in the program is to add external, third-party validation of the program auditing protocols, allowing customers of the U.S. hides and skins industry, including manufacturers, brands, and retailers, to make substantiated and verifiable claims about their leather supply chain transparency. Companies are welcome to enroll in the program beginning in October 2019.
Buyers of certified traceable hides and skins under the program are eligible to receive a Certificate of Origin identifying the facility where the product originated and accreditation information, as listed on the public USDA AMS website. The Certificate of Origin for specific loads of hides and skins that have been further processed into leather and leather goods may be transferred to downstream customers such as manufacturers, brands and retailers, to help comply with supply chain transparency and security efforts.
How is leather traced today? How would this program change that?
Traceability in the U.S. hides, skins and leather industry as it stands today is a patchwork of efforts by individual companies. The new USHSLA traceability program seeks to bring all those individual efforts under one program umbrella, with the U.S. Department of Agriculture acting as a third-party auditor, in order to certify and provide additional legitimacy to the industry’s practices. By moving to an independently certified industry-wide traceability program, the U.S. hides, skins and leather industry will add value to downstream customers by increasing transparency and risk mitigation in their supply chains.
How can businesses participate in the traceability program?
The program is currently open to all U.S. hide, skin and leather producer companies that wish to certify their hides and skins raw materials back to single meatpacking or regional processing plant of origin. Companies wishing to join the program may contact the USHSLA to obtain application information. Leather tanners and manufacturers that wish to purchase certified raw material should work with U.S. suppliers in the program (as listed on the USHSLA website) to obtain eligible products.
For downstream companies in the leather supply chain, such as leather product manufacturers, brands, and retailers, they can participate in the program by specifying U.S. hides and skins in their purchase orders to their supply chain partners, and requesting the Certificate of Origin from the USHSLA traceability program as proof that the raw materials have been sourced from an approved facility. The Certificate of Origin can be checked against the listing on the USDA AMS public website to ensure the facility is indeed approved for traceability claims, and if any questions arise regarding the origin of a particular shipment, the U.S. hide or skin supplier may be contacted.
What does the future look like for the hides, skin and leather industries?
The leather industry, in general, has experienced an extremely tough market for the last several years. Plastic synthetic alternatives that look like leather, but are not real leather, have taken significant market share away from the material in consumer product areas such as footwear and automobile upholstery. The situation is so dire that some lower quality hides and skins are now being composted and destroyed rather than processed into leather. This is because the hide/skin is a byproduct of the meat and dairy industry, worth only about 1% of the overall value of the livestock at this point, so hides and skins will continue to be produced as a part of meat and dairy production even when there is very little demand for leather.
The future of the industry will depend on its ability to sell itself to consumers and brands. Consumers need to be educated about the value proposition of real leather as opposed to fake synthetic alternatives. We need to do a better job explaining that leather is a beautiful, renewable and sustainable natural material that must be better utilized, especially when compared to oil-based plastic alternatives. With industry efforts already underway to achieve this level of awareness, we are hopeful that the future of leather will be very bright.
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About Stephen Sothmann: Stephen is the President of the U.S. Hide, Skin and Leather Association (USHSLA). In this role, Stephen represents and promotes the interests of the U.S. hides and skins industry before a wide range of stakeholders, including U.S. and foreign governments, industry trade associations, media outlets, and other organizations related to global leather production and trade. He was appointed to this role in 2013 after serving as USHSLA’s Director of International Affairs for three years. USHSLA is a close affiliate of the North American Meat Institute (NAMI), the nation’s oldest and largest industry trade association representing meat and poultry packers, processors and traders. Prior to joining USHSLA, Sothmann worked as a member of the legislative staff of United States Senator Evan Bayh from Indiana, covering a broad range of economic issues including international trade and agriculture. A native of the state of Indiana, Sothmann received a Bachelor of Arts from Purdue University, a Master of Business Administration from the Indiana University Kelley School of Business, and Juris Doctor from the Indiana University Robert H. McKinney School of Law.
