Danish footwear firm Ecco has opened one of the world's biggest tanneries in Xiamen, China, to supply its local shoe factory with high quality raw material.

The tannery covers 23,500 square metres and has been purpose-built with an innovative layout and environmentally friendly features. The investment came to EUR20.6 (US$34.9m) in the first phase.

The tannery runs on LPG (liquefied petroleum gas) and uses 25% less water than conventional processes, Arthur Jones, tannery managing director, told just-style.com.

"We wouldn't have had permission if we didn't convince the government that we had clean technology. We had to have a very stringent environmental impact assessment."

It is also one of the world's most automated tanneries, said Jones, cutting out wastage of chemicals and reducing use of vehicles to transport materials on site.

Ecco will import wet-blue hides from Europe as Chinese hides are not of sufficient quality. The material will then be turned into finished leather for use in the neighbouring shoe factory.

All goods made with Ecco's China-produced leather must be exported, however, if the firm is to avoid paying high duties on importing the material.

Current capacity is 400,000 square feet of leather per week. The tannery will also seek other customers, such as a nearby Chinese factory that produces bags for Coach.

"We believe there's a high quality leather market developing in China," said Jones.

Ecco started shoe production in Xiamen in 2005. It exports shoes to the US and other markets and also makes uppers for its other factories.

The company is hoping the duty regime will change in the future so it can supply the rapidly growing domestic market.

Currently it has to import finished shoes from other locations, making its Chinese range the most expensive in the world.

By Dominique Patton.