A $3 million redevelopment at New Zealand Light Leathers in Washdyke is under way after the securing of a processing agreement with Silver Fern Farms.
The meat-processing company's South Island cattle and deer skins will be further processed at the South Canterbury tannery.
That meant all hides and skins could now be processed in the South Island, decreasing the environmental effect of trucking them to the North Island.
New Zealand Light Leathers also had an opportunity to increase its output and expand its business, which was good for the South Canterbury community, Silver Fern Farms chief executive Keith Cooper said.
Silver Fern Farms processed about 220,000 cattle hides and 100,000 deerskins in the South Island each year.
They were sold to several international markets including the United States, Italy, Japan and China, and ended up in fashion houses such as Louis Vuitton, Gucci, Prada, MaxMara, and Hermes, while Toyota Lexus Japan was another major recipient of further processed hides.
New Zealand Light Leathers, which is based at Washdyke in South Canterbury, was established in 1974, initially processing the South Island lamb kill.
In 2004, operations were restructured to concentrate on deerskin, and it is the world's largest supplier of deer leather from New Zealand farmed deer.
The company works with international luxury brands such as Coach, Louis Vuitton, Gucci, Prada and Ralph Lauren.
It was a "longish-term contract" with Silver Fern Farms which meant some capital investment "to build what we need to build", managing director Neil Dickson said yesterday.
It was "a bit of a change" in emphasis, as the company specialised in deerskins and had not been cattle-hide processors, and it "adds another string to our bow".
The expansion could add between 20 and 25 extra jobs during the peak of the season.
