ITALIAN TANNING INDUSTRY, CITES & TRACEABILITY OF PYTHON SKINS Luca Boltri UNIC Group - Italian Tanners’ Association Geneve 17-18 October 2013 Content 1. UNIC: role and activities 2. The Italian Tanning Industry 3. CITES in Italy 4. Traceability of Python Skins UNIC: role and activities UNIC - Unione Nazionale Industria Conciaria (Italian Tanners’ Association) Since 1946, the private trade association officially representing the Italian tanning industry Member of Confindustria, Cotance (EU Confederation of Tanners), ICT (International Council of Tanners ) Headquarters: Milan - Italy Branch offices in Italy: Arzignano (VI), S. Croce s/Arno (PI), Solofra (AV), Rome International branch offices: - China: Guangzhou - Brazil: Sao Paulo UNIC: role and activities Industrial Relations National labour contract, welfare issues Economic and market analisys Stats, trade assistance R&D - Technology, environment, chemicals => Sustainability report (yearly, since 2002) Code of Conduct Based on SA8000 principles Collective Trademarks & Intellectual Property Education and Training Seminars, courses International Relationships Cooperation and lobby Promotion and Communication UNIC: the Group Certification Technological Research & Development Worldwide fair system (EU, US, Asia) Magazines Styles & Design Bank Guarantees The Italian Tanning Industry: world leadership World leader for value, quality, internationalisation, technological development, social/environmental commitment, design Italian quota over world total values (2012) Finished leather production 15.5% Finished leather export 25.3% Raw hides/skins import 15.8% Semiprocessed leather import 21.5% Source: UN-FAO On EU-27, Italy accounts for 65% of total tanning turnover and 60% of production volume Spain 10%, Germany 6%, France 5%, Austria 5% The Italian Tanning Industry: national data 2012 1,282 tanning companies 17,667 employees 126 mln. sqm (finished leather) 34.384 tons (sole leather) 4.8 billion €ur 3.4 billion €ur The Italian Tanning Industry: international markets Export represents more than 70% of turnover (double than 20 years ago) and is normally directed to more than 120 Countries Italian leather export - % for regional area (2012) 6 % 7 % 53% 28% 6% The Italian Tanning Industry: a cluster economy model 90% of the Italian production is concentrated in 3 districts: VENETO: Arzignano (VI) 52% of total production Bovine leather for upholstery (automotive/furniture) and shoes TUSCANY: S. Croce S/A (PI) 29% production, 43% companies Calf leather for high fashion CAMPANIA: Solofra & Naples 9% production Sheep/goat leather OTHER REGIONS: Lombardy, Piedmont, Marche, etc. The Italian Tanning Industry: segmentation Animal origin Bovine, sheep & goat = 99% of total production volume Destination clients (sectors) Two “macro-clients”: fashion (72% on total) vs upholstery (26%) Destination clients (price ranges) The highest ranges clients (Top and High) accounts for nearly 40% on total Italian leather sales The Italian Tanning Industry: sustainability Sustainability as a key factor for the Italian tanning industry - environmental impact: 10 years improvement and present results => -52% of energetic consumption per sqm, -21% of water consumption => -16% of solid waste production per sqm, -54% of solvent use per sqm => 98% of wastes collected and 73% recycled => 93% to 99% reduction of pollutants in wastewater (excl. clorures, sulphates) - social responsibility: 7 years improvement and present results => -51% of accident severity ratio, -55% of relative accident frequency - certification: 43% of whole Italian turnover from certified tanneries => ISO 9000, 14001, EMAS, OHSAS 18001, product schemes under UNI - raw materials: EU regulation on animal welfare and traceability - chemicals: Reach and the other EU regulation (biocides, etc.) CITES in Italy: introduction Italy is traditionally one of the countries with the most relevant trade of CITES species worldwide For this reason, we have one of the more strict and severe CITES regulations globally, according to our Government authorities For the Italian leather industry, the most important animal class under CITES is reptile CITES in Italy: reptile trade Italy is the most important market for CITES reptile skins in the world, covering nearly 13% of global trade (excluding Singapore) Main species imported: Crocodiles and Pythons Main suppliers: Far East and South America Source: CFS Italy on extra-EU import licenses 2010-2012 CITES in Italy: regulation Regulation: EU level (Reg. EC 338/1997, etc.) + National level (Law 874/1975, etc.) Authorities: in Italy, 3 different ministries are involved in CITES issues management (Environment; Agriculture, Food and Forestry, for CFS - State Forestry Corps; Economic Development). Specific transparency requirements: implemented through the Detention Register (Environment Ministry Decree 8/2002, following Law 150/1992) CITES in Italy: Detention Register (1) All the concerned companies are required to keep a record of detention for the species included in annex A and B In order to better ensure traceability, the register lists all the company loading and unloading of the CITES specimens or derivative products and must be made available to the management authority (CFS) for controls The leather industry operators required to keep it are: a) tanners and leather traders (incl. importers and exporters) b) manufacturers of shoes, leathergoods and leather products Traders of leather products are excluded CITES in Italy: Detention Register (2) Which format? Paper or electronic Where to request? Local offices of CITES CFS State Forestry Corps When to request? Within 15 days from the arrival of transportation documents coming with CITES products How much does it cost? Free What if I make a formal mistake in filling it? Big fines! CITES in Italy: Detention Register (3) Load to be recorded within 15 days from receipt of goods. The lines must be numbered consecutively. Each line contains a single operation Typo of acquisition: A= purchase B=custody C=free purchase D=donation E=discovery F=other Source: W=wild R=ranching C=captive breeding U=unknown Document of acquisition: A=invoice B=custody contract C=free transfer D=donation E=other (DDT) Quantity: As referred in the purchase document CITES Document: N°, date, Country issuing the CITES document on specimens (CITES document provided by the supplier) Identification: Only for crocodiles (each skin tagged) CITES in Italy: Detention Register (4) Milano The first column must contain the same data included in the related load The consumed quantity for the production of the article consumed to be inserted in the same measure unit indicated in the load (and in the purchase) Exit reason: A= death B= sale C= custody D= escape (only for live animals) E= theft F= other Exit document: A= invoice B=custody contract C=free transfer D=donation E=other (DDT) Exit place: Specify the location where the product is destined Traceability of Python Skins: requirements The Italian tanning industry invites to consider three main requirements for the constitution of a traceability system for pyhton skins: a) no conflict with the various production process operations (not only in the finishing phase) provided for the python skins tanning in Italy b) no further complication for the current management of CITES regulation in Italy c) not too expensive for the single tannery and/or the Italian Government (budget problem) Traceability of Python Skins: a) compatibility with process (1) A plastic tag (button or loop) attached to the skin is NOT COMPATIBLE with many mechanical operations necessary in our production process: • drum operations (tanning, re-tanning): damage of scales • lamination, ironing, buffing, shaving, polishing, stretching, staking, glazing, etc.: machineries use wheel mechanisms In order to make such operations, THE PLASTIC TAG MUST BE REMOVED before starting the process In order to be efficient, plastic tag should be placed in the head (even if it has weak fibers): (1) less valuable part, (2) due to scales orientation, process is from tale to head Traceability of Python Skins: a) compatibility with process (2) A RFID tag attached to the skins will not remarkably affect the production process (if placed on the head) but will probably be damaged in the mentioned operations In order to be 100% efficient, the RFID tag should be better removed before starting the process No other traceability mean? Traceability of Python Skins: b) no further bureaucracy The administrative burden of CITES regulation in Italy is the main entry barrier in the reptile leather segment, plus the main reason for the closure of existing tanneries Big investments of time, finance, human resources Apart from the severe regulation itself (register included), some recent problems with the CITES national system: - Scientific Commission advices release procedure - Scientific Commission members nomination - Delayed supply of crocodile tags… Very few resources dedicated to CITES ministerial departments by the Italian Government (financial, HR) Traceability of Python Skins: c) cost-efficiency (1) Profitability of the business should be preserved A traceability system implies costs for tags supplying, information system creation/management, enforcement... Who will bear these costs? Leather industry is a multi-niches business; each segment follows the offer/demand/price pattern, being subject to competition from: - other leather segment - alternative materials (textiles, synthetics…) Rising costs => rising prices => rising risk of market reduction for the whole chain Traceability of Python Skins: conclusion The Italian tanning industry is considered as highly sustainable from all the concerned point of views The python skins segment (10 tanneries, Tuscany area, 240 workers appr.) received also a positive feedback on the transparency of trade practices (see also the related ITC study) CITES regulation in Italy already provides traceability through the detention register, in addition to the rest of common regulation. A global adoption? Sustainability through traceability is an “hot issue” also for us but must be well directed and focused. Otherwise, it is useless and damaging, not only for tanners and workers, but also for the final product and consumer markets. UNIC Group - Italian Tanners’ Association Via Brisa, 3 - Milan (Italy) Email: [email protected]