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Chinese capacity conundrums The rise or fall of the WC Oil price effects Brick logistics Plus news, views, analysis and much more!
Group of companies Aldul Rahman & Aldul Kareem Saleh Al-Omran were establish in 1975 under the name of Al-Omran Sanitary ware and specialized in wholesale and retail trade of sanitary ware in the kingdom and the Middle East, Whre the importation of the major companies and factories world finest varieties and the latest models to suit all taste and in very large quantity to cover all the request for the large projects and the group is one of the largest and most famous companies working in this field in Saudi Arabia and the Gulf States in the framework of the Group’s commitment to provide distinctive products has added industrial ACTIVITY through the creation of the group of companies large industrial sophisticated and includes four leading industrial companies under the name of AL-JAWDAH Companies, Namely
Al-Jawdah Ceramics Company was establish in 1995 and produces ceramics wall and floor tiles with a range of products. The company produces all decorative products such as Listello, Skirting etc to match the tiles. The Company continous growth to fulfill the Saudi Arabian and Middle East market requirements.
Al-Jawdah Company for Plastic Pipes and Fittings, The Company was founded in 1994 and is engaged in the production of plastic pipes of the (PVC) and (C-PVC) and (UPVC) and (PP-R) This addition to the production of links all kinds of plastic in all sizes and different thickness are used in various fields such as extensions of water lines with high and low pressure and sewage extensions to the Saudi Arabian Standards for Standards, Metrology and international standards.
One of Abdul Rahman, a group of companies and Abdul Karem Saleh Omran Trade and Industry, Begun commercial production of the plant in early 1999, The factory is located in Riyadh Second Industrial City and a production capacity of up to (400,000) electric water heater annually. The factory produces electric water heaters sizes (30, 50, 100, 200, 250, 300 liters) multiples different colors and models, including horizontal and vertical fashioned style and ground style central and style.
Sachi PH 6500 Press Arrives in Saudi Arabia Al-Jawdah Porcelain and Ceramic Company is the new establish by Al-Jawdah Group of Companies near to our existing complex in 2nd Industrial City, Riyadh, Kingdom of Saudi Arabia. The Company is under construction and installment of the machines are in progress with italian company machines which are include SACHI, SYSTEM CERAMICS, CIMES, TECHNO FERRARI, MARPAK, BMR and FRACCAROLLI/CAMI with latest technology. Plant equipped with special SACHMI Hydraulic Press PH 3200 and PH 6500 and attractive KILN for the production of Procelain Tiles with the capacity 13.0 Million square meters per annum. The capacity. Plant expected in operation in 1st Quarter of 2017 with full complete building of 9,200 square meter area built for the future expansion to double the Plant capacit support of Ministry of Kingdom of Saudi Arabia with supply of natural gas and electricity, The investment done by AL-OMRAN GROUP Mr. Abdul Rahman S. Omran and Mr. Abdul Karem S. Al-Omran to fulfill the Saudi Arabian Market demand of Ceramic and Porcelain Tiles.
News
Contents: AC 17-1 News
Features
4 Inside Asia
28 Brick logistics
Hopes build for ASEAN Ceramics.
6 Welcome
China faces dumping woes.
8 Across The Continent
Openings, closures and industry moves from across Asia.
20 International News Our eye on the international arena.
36 Rise of the WC?
Rohan Gunasekera looks at how changing market dynamics are affecting the requirement for the traditional squatting pan, as the rise of the WC continues.
42 China: a capacity conundrum
24 Material Matters Raw materials news and views.
AC looks into the relative strengths of China’s major tile producing provinces, as they come under increasing domestic pressure and international attack.
26 Comment & Analysis
48 Fuel price pressures
Riding the Bangla building boom.
AC looks at how the fluctuating fortunes of the global gas and oil industries, in the face of concerns over energy security and rapidly evolving political landscapes, could have a massive impact on ceramics right across the continent.
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Yogender Malik looks at how the logistics of Southern Asia’s brick builders and suppliers is proving to be one of the key issues in the profitability of the sector.
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54 Talking Shop
Rob Flello, Labour MP for Stoke-on-Trent South in the UK, describes in the Huffington Post how the government must protect the resurgent ceramic industry post-Brexit. Analysis and insight into Malaysia.
76 The Hunter And The Hunted
William forget his New Year’s resolution to be more positive, and, whilst in reflective mood over the downs and ups of 2016, looks into the coming 12 months with renewed…pessimism… www.asianceramics.com
Inside Asia ASEAN CERAMICS 2017: A RISING STAR? Each edition of ASEAN Ceramics has been an exciting development for the exhibition in Bangkok. The exhibition has evolved from being predominantly positioned as a Southeast Asian event for ceramic manufacturing to becoming a pan-Asian business platform with the highest buyer growth rates being achieved from Bangladesh, the Far-East, India and China, but with the lead attendance being maintained from Vietnam, Malaysia and Indonesia. The 2017 edition, to be held on the slightly earlier dates of 31st August to 2nd September, is particularly given the new products to be launched at the event from our key exhibitors; and also due to the companies and product development trends being seen for the first time in the event and in some cases for the first time in Asia. 2017 brings with it many new support groups and this too will add new perspective and depth to the event with double the number of delegations planned from Vietnam
and new groups from Sri Lanka, Japan, the Philippines and India. Welcomed also for 2017 is the expo’s move to the new Hall 101 at BITEC providing excellent facilities, and located next to the newly constructed city skytrain access bridge. Since its inception ASEAN Ceramics has evolved rapidly as the Asian markets provide a strong growth market for global suppliers and Bangkok firmly establishes itself as the dynamic hub f the ceramic manufacturing industry in Asia. ASEAN Ceramics has quickly responded to the changing market trends and challenges and has firmly established the exhibition and supporting conference as the independent international platform for ceramic business in Asia. The challenges for ASEAN Ceramics 2017 has been to keep pace with the development of the industry in Asia
and provide a truly level playing field for business that reflects global trends and innovations that are positioned towards the Asian market needs. Whilst ASEAN Ceramics is recognised as the definitive business platform, it is also important for organisers to be able to present the diversity of ceramic technology and materials, in tandem with the representative buyer groups they supply to. This must be done with the knowledge platform to support this in the form of the co-located conference programme. A key strength of ASEAN Ceramics is its independent positioning as an international industry led event for Asia. The exhibition is led by global market leaders with strong affiliations to the pan-Asian market requirements, rather than having local market advantages or global standardisation traits. Bangkok also provides ASEAN Ceramics with an ideal geographical positioning in the heart of Southeast Asia with
direct market access to South Asia, Central Asia and the FarEast, nowhere in Asia has the same global connectivity as Bangkok, coupled with ease of entry and cost of travel. ASEAN Ceramics also boasts the most international ratio of buyers and exhibitors to the event, representing 47 countries over the last 2 editions with an average of less than 18% of local participation. The recent establishment of the ASEAN Economic Community has undoubtedly provided vast opportunities for expansion and trade within and to Southeast Asia. Thailand is dominating within the union as the powerhouse of ceramic production and its clear from where the advantages are drawn. The fact that China’s costs and market barriers continue to rise, whilst in reverse ASEAN’s material and technology demands increase, then there is little surprise that ASEAN Ceramics 2017 is set to become the most successful event of the series, and most likely the region, so far.
Welcome
Chinese companies were the target of a record number of trade dispute cases in 2016, the Ministry of Commerce (MOFCOM) has announced, with tiles, tableware and sanitaryware heavily affected. In a bid to tackle possible tougher trade friction in 2017, China is beefing up efforts to transform its economic growth model by upgrading and innovating industries to enhance the competitiveness of Chinese products, experts noted.
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IN FOCUS:
Chinese capacity conu ndrums The rise or fall of the WC Oil price effects Brick logistics Plus news, views, analy sis and much
Roughly 27 countries and regions filed 119 trade more! remedy cases against China-made products in 2016, an increase of 36.8 percent from the previous year, ministry spokesperson Sun Jiwen said recently. Trade volume involved in the cases was $14.34 billion more than last year, up 76 percent year-onyear, MOFCOM data showed. "Trade disputes grew politicized last year, and trade remedies tended to be extreme," Sun said. Xu Hongcai, deputy chief economist at the China Center for International Economic Exchange (CCIEE) said that the situation will become even tougher this year as the world is widely plagued with uncertainties. "Trade barriers and protectionism keep rising across the globe since major world economics like the US, Japan and some European countries and regions do not recognize China's market economy status, which will bring tougher times for the country in 2017," Xu told the Global Times on Thursday.
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Now that US President-elect Donald Trump named Robert Lighthizer, a harsh critic of China's trade practices, as his chief trade negotiator, there is fresh anxiety over 2017. "We do not expect a trade war between China and the US, and we still hold a wait-and-see attitude toward Trump's measures on Chinese products after he takes office," Xu said. In 2016, many countries and regions put restrictions on Chinese products such as photovoltaic panels, ceramic tiles and tires, said Sun, the ministry's spokesperson. There were also a number of trade disputes involving chemical engineering and light manufacturing, according to MOFCOM. Meanwhile, "more than half of the trade dispute cases involved the Chinese steel industry," Sun noted. The CCPIT had set up 102 trade friction alert institutions across the country by the end of 2016, covering sectors such as steel, heavy machinery and tea. "Trade remedies are a double-edged sword," MOFCOM spokesperson Sun said. "Given the sluggish global economy, we hope that each country and region will apply trade remedies cautiously." China would prefer to cooperate with other countries through negotiations to address trade disputes, in order to encourage a faster recovery of the global economy, according to Sun. In a bid to address trade friction, Chinese enterprises are expected to keep improving competitiveness of their products, said Xu, the expert with CCIEE. He noted that cutting costs in the manufacturing industry is helpful. China is prepared to deal with the upcoming challenges and the government will continue to support globalization as well as trade liberalization, Xu said. Happy reading!
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Brick makers see funding influx • Zig-zag kilns aid brick revival • Ceramics to benefit from lower gas prices • Kera • gathers pace Morbi looks to overseas distribution • Gas price relief to offset capacity issues? • Viglacera to list on H pressure grows on tile company • Back to the future for Silk Road ceramics • Tile plant commissioned in Dagestan BANGLADESH
Brick makers see funding influx Eight environment-friendly brick manufacturers have received Tk 3.64 crore as carbon revenue for 2014-15, as an award for using clean technology that reduces coal consumption by half. M Matiul Islam, chairman of the Industrial and Infrastructure Development Finance Company Ltd or IIDFC, handed over the cheques to the owners and representatives of the brick kilns at a programme at IIDFC's head office in Dhaka recently. Md Asaduzzaman Khan, managing director of the nonbank financial institution, was also present.
The awardees include Kapita Auto Bricks Ltd, Eeta and Tiles Ltd, Banolata Refractory Ltd, Universal Bricks Ltd, Haair (Eco) Bricks Ltd and Bricks 2010 Ltd, IIDFC said in a statement yesterday. The eight brick makers saved emissions of 53,069 tonnes of carbon dioxide by using the Hybrid Hoffman Kilns technology, which reduces coal consumption by about 40-45 percent compared to traditional brick kiln, it added. IIDFC has entered an agreement with the World Bank and the Danish government to trade the emission savings from these kilns. The reduction of carbon dioxide emissions
resulted in valuable foreign currency earnings for the country, IIDFC said. Apart from reducing greenhouse gas emissions, these kilns have also implemented the environmental and social safeguard standards of the WB, setting an example in the industry, according to the statement. IIDFC has also signed a contract with the Asian Development Bank. The Manila-based lender will buy carbon credit generated from the eight units for four years since January 2016. IIDFC has taken up a clean development mechanism or
CDM to improve efficiency in the brick making industry in Bangladesh and reduce emissions of carbon dioxide and other local pollutants that are generated by the traditional brick kilns. The CDM allows emissionreduction projects in developing countries to earn certified emission reduction (CER) credits. These CERs can be traded and sold, and used by industrialised countries to meet a part of their emission reduction targets under the Kyoto Protocol, according to the United Nations Framework Convention on Climate Change.
NEPAL
Zig-zag kilns aid brick revival Brick kilns in the Kathmandu Valley have adopted zig-zag system in brick production to reduce brick kiln emissions. Former industry minister Mahesh Basnet had released ‘Design Manual for Improved Fixed Chimney Zig-Zag Brick Kilns’ in October last year and entrepreneurs have been constructing their kilns under this model, especially following the earthquake in 2015. Such model for brick kiln construction was developed by the International Centre for Integrated Mountain Development (ICIMOD) and the model follows zig-zag pattern of brick baking to reduce emission of suspended particular material (SPM) into the atmosphere. Under this model, bricks are laid in a zig-zag system while baking and singleman-coal-feeding system
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is applied when bricks are baked. This system of baking bricks is believed to increase air flow inside brick chimneys that ensures effective and uniform burning of coal, which ultimately helps to reduce black carbon emission from brick chimneys. “Almost all 100 brick kilns operating in the Valley have reconstructed their chimneys as per the new model,” said Mahindra Bahadur Chitrakar, president of the Federation of Nepal Brick Industries, adding that zigzag methodology has proved not only to be environmentfriendly and energy-efficient but also resulted in enhancing structural safety of chimneys. As per Chitrakar, brick kilns outside the Valley are also slowly adopting the new model of chimney construction and production through zig-zag
technology. “The new model has become more popular among brick kilns after the earthquake of last year, which damaged almost 350 brick kilns across the country.” According to the federation, there are around 950 brick kilns across the country. Operators of brick kilns also concur that adoption of new model of baking bricks in zigzag system has significantly reduced emission of SPM into the atmosphere. “As per the regulation, brick kilns cannot emit more than 700 mg/NM3 SPM. However, the SPM emission dropped to as low as 113 mg/Nm3 after the brick kilns were reconstructed under new model and bricks were baked under zig-zag system,” said Raj Kumar Lakhemaru, owner of Swet Bhairab Fixed IttaUdhyog in Bhaktapur, adding that this
has also reduced health-risks of labourers working inside the brick kilns. “Smoke gets bent and filtered at numerous points inside the chimneys while bricks are baked using the zig-zag method. As a result, low carbon is emitted from the chimneys,” said Lakhemaru. All 63 brick kilns in Bhaktapur have followed this method after realising the benefits.
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rala mining ban threatens ceramic sector • GE opts for SiC fibres as industry HNX • Handicraft centres fuel a ceramic revolution • Environmental n • Durst Full Digital Glaze Technology heads East • INDONESIA
Ceramics to benefit from lower gas prices The government aims to lower gas prices for the ceramics and sheet glass industries this year, adding to three other industries previously set for reduced tariffs. Last year President Joko “Jokowi” Widodo ordered his Cabinet to slash down gas prices to below US$6 per million British thermal unit (mmbtu) for 10 industries and one industrial zone starting from January. However, Energy and Mineral Resources Ministerial Regulation No. 40/2016, issued last December, only stipulates the reduced rate at around $6 per mmbtu for the petrochemical, fertilizer and steel industries starting from Jan. 1. Even so, Industry Minister Airlangga Hartarto said that discussions on price cuts for the ceramics and sheet glass industries would commence in January. “Both of them have strategic potential. In terms of ceramics, the raw materials can be found in Indonesia and this makes our competitiveness strong. Similarly, sheet glass can be used as part of photovoltaics, which contributes to renewable energy,” Airlangga recently said.
The minister also pointed out that the strong competitive edge of both industries will enable them to cope with technology changes. For more than a decade, Southeast Asia’s largest economy has struggled with deindustrialization. The domestic manufacturing industry expanded by 4.25 percent last year, lower than the economic growth of 4.79 percent. In its heyday before the 1997-1998 financial crisis, the industry outpaced the economic expansion. Expensive energy prices have been touted by business players as one of the factors hampering industrial activities and high productivity, which the government has long tried to address. At $8 to $16 per mmbtu, gas prices in Indonesia are among the highest in Southeast Asia, beating those of its neighbors at between $3.50 and $7.50 per mmbtu. The high prices have forced many factories in North Sumatra and East Java to close down and 20,000 workers have been laid
off since 2000, according to the Association of GasConsuming Companies (Apigas). The government has made some headway by passing the ministerial regulation. Although President Jokowi cited 10 sectors and one industrial zone, a presidential regulation issued last May only required that gas prices be cut for seven industries, namely fertilizer, petrochemical, oleochemical, steel, ceramics, glass and rubber gloves. Energy and Mineral Resources Minister Ignasius Jonan said the government would focus on pushing down prices for the remaining four industries and was currently discussing how best to move forward. “We have many things to consider if we want to cut prices: should we cut tax and non-tax revenues? If we cut the prices, how would that affect our agreements with oil and gas contractors?” he said. The average selling price at the upstream level is $5.90 per mmbtu, comprising several components, namely capital and operational expenditures, the contractor’s share and the non-
tax and tax revenue for the state. Lowering the upstream gas prices to $3.82 per mmbtu is possible if the government is willing to remove both the non-tax and tax revenue components, but at the cost of losing $1.2 billion in revenues per year. Nevertheless, the Industry Ministry has estimated that the economic benefits of lowering gas prices can amount to Rp 32 trillion ($2.38 billion) if the prices were cut to $4 per mmbtu, with additional distribution and transportation costs of $1.50 to $2. ReforMiner Institute researcher Pri Agung Rakhmanto said current price cuts were still insignificant as it only applied to three industries as opposed to the seven listed in the presidential regulation.
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INDIA
Kerala mining ban threatens ceramic sector The ban on clay mining by the Mining and Geology Department is threatening to wipe out the tile manufacturing industry in Kozhikode district. Seven out of the nine major tile factories in Feroke have laid off workers owing to scarcity of clay caused by the ban. Two tile units are now partly functioning with limited stock of clay, which had been brought from Karnataka. The units too are likely to resort to layoffs soon. Paying Rs.40,000 for around 25
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tonnes of clay from Karnataka is uneconomical for majority of factory owners as they claim that Feroke and its surrounding areas have plenty of quality clay deposit that can be tapped legally to resolve the crisis. “Within a 24-kilometre radius, it is possible to find the raw material rather than desperately waiting for the overpriced Karnataka stock,” they add. Highlighting the demand, the All Kerala Tile Manufacturers’ Federation will take out a march to the
collectorate on January 10. Their representatives will also meet Chief Minister Pinarayi Vijayan and other Ministers soon to find out a viable solution and protect the industry from sudden extinction. “On several occasions, we have taken up the issue with Ministers and various government departments. The Mining and Geology Department is not even looking at the possibility of an environmentfriendly clay mining in the area,” says M.A. Abdurahiman, State
general secretary of All Kerala Tile Manufacturers’ Federation. He points out that Kozhikode’s tile industry, which once employed more than 3,000 labourers, now has only one-third of its previous strength. Most casual labourers in the industry have lost their jobs. Factory owners say that demonetisation curbs have severely affected sales and doused the spirit of local buyers. Most local retailers are now after the trade of imported ceramic tiles expecting better margin, which will put the last nail on the native industry, they say.
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News
JAPAN
GE opts for SiC fibres as industry gathers pace Tough, lightweight silicon carbide fibers will help improve the fuel efficiency of General Electric's aircraft engines and could spread to other uses, following in the footsteps of earlier Japanese innovations in materials engineering. Japan's materials industry has had success with carbon fibers. Aircraft makers increasingly substitute carbonfiber-reinforced plastics for aluminum alloys in wings and fuselages. New midsize to large craft built by Europe's Airbus and America's Boeing have airframes composed of more than 50% CFRP. Japanese companies hold a roughly 70% share of the CFRP market. At present, only Japan's Ube Industries and Nippon Carbon can produce silicon carbide fibers, a newer material. The International Civil Aviation
Organization has called on airlines to cap carbon dioxide emissions on international routes. Such changes add urgency to the pursuit of aircraft fuel efficiency. Coupled with a projected demand for 38,300 passenger aircraft in 2035 -roughly 80% more than 2015 figure -- Japanese material makers likely will maintain their market dominance. General Electric uses ceramic composite materials made with silicon carbide fibers in its new GE9X aircraft engines, which will be mounted on next-generation Boeing 777X jets. The engine maker already has received orders for the equivalent of 300 aircraft. GE is substituting siliconcarbide-fiber composites for nickel alloy in four parts, including turbine blades. Cutting-edge materials and a retooled design gives the GE9X
10% better fuel efficiency than earlier engines. Ube Industries plans to add a silicon carbide fiber production wing by 2025 at a plant in Ube, Yamaguchi Prefecture. The company currently has only a test plant for the material. It intends to invest tens of billions of yen to lift annual production capacity 20-fold to 200 tons, aiming for 5 billion yen ($43.2 million) a year in sales of the material. Japanese heavy industry group IHI will process the fibers to make composite components. Nippon Carbon recently upped silicon carbide fiber capacity at a Toyama Prefecture plant by 10 times to 10 tons per year, and will take a stake in a GE plant in the U.S. expected to begin production by 2019. The GE plant likely will produce at least 100 tons of the fibers annually.
INDIA
Morbi looks to overseas distribution In an attempt to salvage small manufacturers from influx of Chinese products in global market and to boost exports, the Morbi Ceramic Association (MCA), India's largest cluster for ceramics, will set up its own dedicated warehouses in 11 countries. The association is going to sign a Memorandum of Understanding (MOU) with various trade organisations and associations of USA, Latvia, Vietnam, Africa, Thailand and other countries for the warehouse project. According to MCA, small players can park their ceramic products and supply it according to the demand. Under the MOU, local trade body in the respective country will help MCA to find viable location and set up warehouses. Morbi is home to about 650 ceramic units and it is world's third largest ceramic cluster after Italy and China. "We are planning to setup warehouses in 11 countries
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to provide support to small manufacturers in export. This will help ceramic industry to fulfil their global demand quickly. To setup warehouses, MCA will sign MOUs with 11 countries' trade organizations in Vibrant Ceramic Trade and Summit at Ahmedabad in December," said K G Kundariya, president of MCA. For trial, MCA will setup warehouse in Vietnam. The basic concept of the warehouse project is that the ceramic manufacturers will park their products like wall and floor tiles at the warehouse and supply the stock on demand. According to the project, each warehouse has the capacity to store 200 containers or over 5,000 tonnes ceramic products. Buyers directly get supply from these storages. Kundariya said, "generally it takes a month time for the products to reach buyers. Our concept is to reduce this time so that buyers can easily get their order. This will also help
ceramic industry of India to get more export orders globally and we can explore more markets for us." There are about 650 ceramic units at Morbi and surrounding area which is engaged in floor tile, wall tile and sanitary items. The industry is providing direct employment to the over 400,000 people and indirect employment to 200,000 people. Turnover of Morbi is around Rs 27,000 crore. Since last two years, export is growing from Morbi. During 2015-16 the city had exported about Rs 4,200 crore worth of ceramic products and for 2016-17, the industry is expecting about 4045% growth in exports. "Globally, demand for Indian ceramic products is growing since the last couple of years as we have improved quality with higher adoption of technology. This has helped Morbi to increase exports. We are expecting over Rs 6,000 crore exports in current financial year," said Kundariya.
GE will handle processing of the fibers. Nickel alloy, a mainstay material in engine production, offers less heat resistance than silicon carbide fibers and requires air cooling. Silicon carbide fibers let planes use air more effectively for propulsion instead. The composite material costs more than nickel alloy, but producers hope that mass production will bring the cost down. Silicon carbide fibers weigh one-third that of nickel alloy and can withstand temperatures up to 2,000 C. Besides aircraft engine parts, plans call for using ceramic composite materials made with the fibers in thermal power plant turbines. GE estimates the market for silicon-carbidefiber-based components will grow 10-fold over the next decade.
NEWS IN BRIEF In February 2017, construction of a plant producing ceramic granite tile will be completed in Malino village located near Moscow, the press office of the Moscow regional building complex have said. This investment project, which has been implemented since 2015, was initiated by one of the European leading producers of ceramic granite tile and porcelain gres, Kerama Marazzi. At present, construction of a warehouse with an area of 27,000 square meters is under construction and soon erecting of an industrial unit â„–7 will be finished, where equipment for porcelain enameling will be installed in the area of 4,000 square meters. All works are being carried out at the expense of the investor, which total installed cost exceeded 1,3 billion rubles.
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News
INDIA
Gas price relief to offset capacity issues? Reeling under a slowdown due to a record low in the domestic construction industry, ceramic producers in Gujarat have got a much needed relief by the state authorities, which lowered the piped natural gas prices by more than 2 rupees per cubic meter. “Ceramic tile production in the state has witnessed a decline of about 10- 12 % in the current year due to economic and construction slowdown prevailing in the country,” Managing Partner, Piyush Patel of Time Ceramics, a vitrified ceramic tile producer based in Morbi told Asian Ceramics. Piyush further says, “ Year 2016 has been one of the most turbulent years for the local
industry in recent years. Less than expected demand due to prolonged economic and construction slowdown and later demonitisation of currency has brought a number of units in the unorganized sector to a grinding halt. In these situations, even a small good news ( lowering of natural gas prices) brings cheers to producers.” However, Vikram Soumaya , Managing Director of a mid sized vitrified tile producer, Goldy Ceramics doesn’t share his sentiments, He says, "The production capacity of ceramic products, mainly in vitrified tile, has been increased by almost 40 per cent in the last two years, with lower demand, the capacity utilisation has been impacted adversely. That
way, the recent gas prices cut will not give much benefit to the industry." The overcapacity issue These are not normal times in the ceramic manufacturing heart of India. Morbi, which has been greatly transformed by the huge growth in Indian ceramic manufacturing industry, is facing a problem of too many in recent months. Though addition of new manufacturing capacity and units is not something new for Morbi but the economic and manufacturing climate in the country has started to become visible in the ceramic capital of the country. “Besides the normal capacity addition by about 14 existing producers, about 30- 40 new
VIETNAM
NEWS IN BRIEF
Viglacera to list on HNX In a move to attract new investment capital, the Viglacera Corporation changed its listing from the Unlisted Public Company Market (UPCoM) to the Hanoi Stock Exchange (HNX) on December 22 and trade under the code VGC. With a par value of VND10,000 ($0.44) per share, its more than 65 million shares will be valued at VND650 billion ($28.56 million). The starting price was VND15,600 ($0.69) on the first day of trade on HNX. Last July the Ministry of Construction (MoC), which holds 91.49 per cent of Viglacera, auctioned 11.34 per cent of its shares for VND418 billion ($19 million). The divestment attracted much attention from foreign investors, who purchased 15.5 million shares out of the total of 30 million floated on July 28, according to HNX. The average bid price was VND13,923 ($0.63) against an initial price of VND11,700 ($0.53). As of now, the State, via MoC, remains a majority shareholder in Viglacera, with 78.82 per cent, while foreign shareholders have
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9.16 per cent and domestic shareholders 12.02 per cent. Its charter capital is registered at VND3.07 trillion ($134.9 million). On December 13 Viglacera’s shares closed at VND15,900 ($0.7), up VND5,300 ($0.23) since being first traded on UPCoM. With 42 years in business, Viglacera operates in two major sectors: construction materials and real estate. It has been the leading enterprise in the domestic construction materials market and the biggest investor of industrial zones in Vietnam’s northern region. Despite being known for products such as sanitary ware, ceramic and granite tiles, terracotta, and nonfired materials, and exporting to 40 countries, glass is the most promising product of Viglacera in the current market circumstances. In the real estate sector, Viglacera owns five urban areas, four shopping - office malls, and ten industrial parks with a total area of 3,580 ha. It has 40 subsidiaries and affiliates. In the construction
ceramic tile manufacturing units are also coming up in the next three months period and this will add more in production capacity. ” according to M P Shorya, managing director, Orbit Cera Tiles Private Limited. “The industry failed to understand the actual demand scenario, and thus is now suffering from under utilisation of production capacity, which has dropped from 90 per cent around two years back to around 70-75 per cent at present,” he further says. Currently, Morbi houses more than 600 manufacturing units in tile and sanitary ware production. Around 40- 50 new manufacturing units joins the ceramic production every year in this small town.
materials sector it owns three sanitary ware factories, three glass factories, and five ceramic and granite tile factories, among others. In 2016 the company planned for business results to increase by 6 to 20 per cent compared to 2015. Exceeding expectations, in the first nine months of this year it posted a pre-tax profit of VND557 billion ($24.5 million), up 44 per cent yearon-year and nearly reaching the annual plan of VND559 billion ($24.56 million). After-tax profit stood at VND455 billion ($20 million) in the first nine months. For next year it has set consolidated revenue at VND9.68 trillion ($425.3 million) and after-tax profit at VND677 billion ($29.7 million), increases of 17.5 per cent and 21.1 per cent, respectively, compared to 2016. The dividend payout has been set at 8 per cent. From 2015 to 2020, Viglacera has targeted an average growth rate of 10 to 20 per cent in major manufacturing lines. After listing on HNX it will focus on investments, starting from 2017.
Vietnam Debt and Asset Trading Corporation (DATC) aimed to sell 3.7 million shares of Cosevco Ceramic Tiles Joint Stock Company at an auction on January 6 at the Hà Nội Stock Exchange. Foreign investors were allowed to buy 3.315 million shares. DATC currently holds 3.7 million shares, or 56.77 per cent, of Cosevco’s charter capital. Cosevco curently has two major shareholders -- DATC (56.77 per cent) and Central Construction Corporation (27.39 per cent). Thanh Thanh Joint Stock Co also holds 4.62 per cent of Cosevco’s charter capital. Cosevco reported a profit of more than VNĐ6.5 billion last year. The company’s after-tax profit in the first nine months of this year was nearly VNĐ2.46 billion. The company is targeting a turnover of VNĐ209.75 billion in 2017 with after-tax profit of VNĐ4.12 billion.
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VIETNAM
Handicraft centres fuel a ceramic revolution Craft villages in various parts of Vietnam provide the country's gifts and premiums industry a large pool of artisans capable of creating a diverse range of products. Craft villages in the north can be found mainly in or near the Red River Delta region. Most are located in Hanoi and the provinces of Thai Binh, Ha Nam, Nam Dinh, Thanh Hoa, Hung Yen and Bac Giang. In the south, craft villages are mainly located in the Mekong Delta region, and Binh Duong and Dong Nai provinces. The Vietnam government has been nurturing craft villages through various programs and policies aimed at helping them improve their designs to meet the requirements of various overseas buyers. The government also aids these villages in promoting their products, finding customers
and expanding market reach. Examples of government support include providing craft villages vocational training on topics ranging from product design to brand building. Local governments also help these villages participate in trade fairs held within Vietnam and overseas. Vietnam's gifts and premiums industry exports about 60 percent of its output. Craft gifts constitute the bulk of products sent overseas, while stationery is one of the least exported items. Export statistics for gifts and premiums are not readily available, but data from the General Department of Vietnam Customs show that the country exported about $10.8 billion worth of plastic, wood, ceramic, paper and glass products in 2015, up 9 percent from 2014. The increase was attributed to
growing demand for Vietnam products in general as more buyers opt to source from Vietnam instead of mainland China. Besides traditional markets such as the US, the EU and Japan, some suppliers of gifts and premiums in Vietnam export to Brazil, Russia, India and South Africa. A major challenge facing the industry is intense competition from mainland China. This is particularly true for the stationery sector, which finds itself pitted against the higher production capacities and quicker turnaround times of makers in mainland China. Another factor hindering the growth of the industry is the dependence on imports for metal, plastic and paper. Paper is usually sourced from Indonesia and metal such as aluminum, zinc and iron are procured from Taiwan
and Thailand. Rising labor costs is also a roadblock. While Vietnam's wages are generally still lower than those of mainland China, suppliers of gifts and premiums have seen labor costs increase 5 to 10 percent annually in recentyears. In 2015, the average monthly salary of a worker in Vietnam was $157, up from $145 in 2014 and $105 in 2013. Labor costs are expected to increase further in 2017. Some sectors also have to deal with increasing raw material costs. Paper imported from Indonesia, in particular, went up 10 to 40 percent in the first half of 2016. The cost of ceramic materials is expected to go up by 5 to 10 percent, but suppliers of gifts and premiums anticipate that this will be offset by certain types of glaze becoming less expensive.
VIETNAM
Environmental pressure grows on tile company A ceramic tile manufacturer in southern Vietnam has been discovered dumping raw, black sewage into a river. Vietnam’s Bureau of Environmental Crimes on Monday said it had just caught Pak Vietnam SingleMember LLC, located in Dong Nai Province, in the act of discharging untreated waste into the environment. According to its business license, the company is specialized in manufacturing ceramic tiles and selling construction materials. At the company’s factory in Phuoc Binh Commune, Long Thanh District, black, putrid sewage could be seen coming out of its drainage system into the nearby hamlet of Phuoc Hung. The wastewater continued through the My Xuan B1 industrial park in neighboring Ba Ria-Vung Tau Province into the Keo Stream, before flowing
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directly into a seven-kilometer section of the Thi Vai River. The Thi Vai River snakes 76 kilometers through Ba Ria-Vung Tau and Dong Nai, and is often subject to water pollution from factories based in the latter industry-driven province. Inside Pak Vietnam’s Dong Nai factory, a coolant bath for one of its coal gasification boilers were dug out of the ground with no partition from tangent soil. The bath measured 40 meters long, 20 meters wide and 0.5 meters deep. Another square bath measuring five meters on each side and 0.15 meters deep also had no separation between the thick, black liquid it contained and the tangent natural soil. One of its coal gasification boilers was in operation. A water pump was installed at the former coolant bath to pump sewage directly into the environment.
A police officer takes samples of the sewage of Pak Vietnam’s factory in Dong Nai Province for lab tests. Photo: Tuoi Tre
A Pak Vietnam representative said the water pump has a capacity of 1,800 kWh and is used to pump coolant into its warehouse through a tenmeter pipe. Police officers booked the case and took four samples of the
sewage for further lab tests. Relevant authorities also requested that the company put an immediate end to the dumping of the black, putrid liquid into the environment and had the dumped liquid collected for proper treatment.
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THAILAND
Back to the future for Silk Road ceramics Sangkhalok ceramics, an ancient product of the Silk Road and a combination of both Chinese and Thai cultures, are now being manufactured again and are winning new-found popularity due to the ceramics' unique colors and motifs. Forty years ago, a Thai farmer came across some ancient ceramic wares with distinctive detailing while he was plowing his fields. The farmer, Prasert Mahothorn, was mesmerized by the vivid blue color and detailed patterns featuring fish and flowers. After that he devoted himself to studying the ancient techniques used to produce such spellbinding and beguiling artifacts. The Sangkhalok ceramics originally uncovered by Prasert can be dated back to the Sukhothai Kingdom period (1238-1583) and the Ayutthaya kingdom period (1351-1767). In the 1970s, more than 200 kilns were also found in the Si Satchanalai region, adjacent to Sukhothai city. Locals set up a private museum to collect the excavated ceramic wares from this area and an entire village specializing on manufacturing new Sangkhalok ceramics emerged. In a studio packed with Chinese porcelain, 72-year old Prasert told Xinhua that these delicate artifacts are exceedingly beautiful and that it was their beauty that drove him to learn how to make these ceramics when he was younger. Imitating the motifs found on authentic ancient ceramic
artifacts and combining them with other patterns he learned from books, Prasert's works, with their unique style, won him some Thai businesspeople as customers. Once his business had become successful, Prasert set up a studio to teach his family members and residents of the village the technique of making Sangkhalok ceramics. Though there is a local museum, most of the excavated ceramic artifacts are now kept by the Southeast Asian Ceramics Museum of Bangkok University, which now boasts a collection of more than 16,000 ancient ceramic wares, and is the the biggest such collection in Thailand. Ceramics from ancient China arrived in Thailand by Silk Road trade routes and inspired the Thai craftsmen at the time. The local craftsmen at the time went on to imitate the Chinese technique of manufacturing and thus Sangkhalok ceramics were born, explained Pariwat Thammapreechakorn, curator of the Southeast Asian Ceramics Museum. "There were ceramics indigenous to ancient Thailand but these original ceramics cannot compete with Chinese ones in terms of technique or popularity around the world. That's why ancient Thai craftsmen decided to imitate the technique of Chinese ceramics, especially Longquan celadon from the Song Dynasty (960-1279)," said Pariwat. The meaning of "Sangkhalok" is still uncertain. Some Thai
scholars believe "Sang" may refer to the Song Dynasty of China, while others believe Sangkhalok was the then Chinese or Japanese inaccurate pronunciation of "Sawankhalok", a popular name in the city of Si satchanalai, according to Thai history. Though it cannot be proved that its name comes from China, the birth of Sangkhalok ceramics is certainly closely connected with Chinese history. During China's Tang Dynasty (618-907), a large number of Chinese ceramics, the main products of the maritime silk road, were exported to Southeast Asia. When it came to the Yuan Dynasty (12791368), China's blue and white porcelain was leading the world of fashion. The porcelain was not only a treasure of the then royal family and aristocracies of Thailand, but also used as sacred items in religious rituals. However, the following Ming Dynasty (1368-1644) imposed a sea ban policy that restricted private maritime trading and coastal settlement, which led to a huge decrease of Chinese ceramics in global markets and thus encouraged Thai craftsmen to copy the technique of the Chinese. It was a golden age for Sangkhalok ceramics. However, when the Ming court decided to end the sea ban policy in 1567, and also due to some other reasons, the manufacturing of Sangkhalok ceramics was stopped and
the artifacts lost, until people found them in recent decades. Many experts said the Sukhothai Kingdom sent men to China and brought Chinese craftsmen back with them to teach the technique of making ceramics, so there are patters on some Sangkhalok ceramics that are very similar to Chinese traditional patterns. Pariwat argued that there is no record of any Chinese craftsmen setting up a kiln in Thai history, and although both Sangkhalok ceramics and Chinese blue and white porcelain have patterns of flowers, birds and fish, there are obvious differences because Thai craftsmen added their own understanding and depictions of nature to their work. He said that Thais imitating Chinese ceramics reflects ancient Thais' craving for delicateness and civilization. Nowadays, the Southeast Asian Ceramics Museum, together with Chinese experts, has held several seminars on ceramics trade from the end of the Yuan Dynasty to the beginning of the Ming Dynasty in Thailand. Prasert's village has become the only one in Thailand devoting itself to the art of making Sangkhalok ceramics. According to Prasert, there are about 40 families manufacturing Sangkhalok ceramics there and their products have been sold to different provinces of Thailand and also to foreign countries, as was the case in ancient times.
RUSSIA
Tile plant commissioned in Dagestan A Russian-Italian plant for the manufacture of floor ceramic and porcelain tiles, built on the site of the industrial park "Tubeh" was commissioned in Kumtorkalinsky district of Dagestan on December 21, the press service of Dagestan
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Head and government administration reported. The plant is equipped with the latest equipment and has no analogues in Russia. Thus, the products of the plant will become the most modern in Russia at a low price. The design capacity of the new
plant will make more than 2 million square meters of tiles per year. The plant production will be supplied to the markets of the Russian regions, especially in the North Caucasus Federal District. Besides, the tiles will be exported abroad: in
Azerbaijan, Turkmenistan, Kazakhstan and other countries. The volume of investments in the company amounts to about 1.5 billion rubles. About 75 jobs are created. In 2018, the plant is expected to launch the second production line.
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JAPAN
Durst Full Digital Glaze Technology heads East Local sales partner Goto Inc. unveils Durst innovation at the technology conference organized by the Japanese ceramic machinery association, JCMA. Durst, manufacturer of advanced digital production technology, is now also attracting considerable interest in Japan, following the much-noticed Full Digital Glaze Line concept presentation at Technargilla 2016 in Italy. Local Durst sales partner Goto Inc. unveiled the Durst innovation at the 4th
technology conference of the Japan Ceramic Machinery Association (JCMA). With the Full Digital Glaze Line, Durst is taking tile production to the next level of automation, and synchronizing the glazing, decoration, and final finishing steps to create an end-to-end production process. The future all-in-one solution comprises the newly developed Durst Gamma DG for digital glazing and the modern 8-color ceramic printer generation from the Durst Gamma XD 4.0 series, and is controlled by
a central workflow software. Japanese ceramic producers were very excited by the tremendous potential that the production line offers in combination with the new effect inks. The design variations on the sample tiles presented by Durst in particular attracted huge interest. Durst Digital Glaze allows a complete top layer of glaze to be applied to tiles, and real structures with extrafine definition and a high layer thickness to be created. For the participants, this was proof
of Durst’s innovative strength in taking post-digitalization ceramic production into the next stage of evolution. In addition to technological prospects, Shoichiro Goto, Managing Director of the local Durst distribution partner, also unveiled the current Durst Ceramics Printing portfolio with its flagship Gamma 108 XD 4.0 model. Equipped with DM (Digital Material) printhead technology, it prints especially large volumes of ink (over 100 gsm) in order to achieve highest quality.
THAILAND
Trend Announces retirement of industry stalwart Trend Industrial Ceramics, the leading global force in cordierite kiln furniture, has announced that Brian Dodd took full retirement at the end of 2016 after 42 years in the ceramic industry. “Over these years I have met many people within the ceramics industry and I have to say, with the very rare exception, they have helped to make my working life fulfilling and more importantly fun. To you all a very big thank you,” commented Brian. Brian joined Norton Advanced Ceramics in Stoke-on-Trent back in 1974 as a project engineer. In those days there were four major kiln furniture manufacturers within a six-mile radius of the centre of the city – the heart of the UK ceramics industry. Brian’s brief was to try and rationalise a labour intensive production operation by introducing automation where possible. In all, Brian spent 24 years at Norton’s facility in Fenton, becoming Factory Manager in 1985. This period saw major changes in the kiln furniture industry, not least as a result of the introduction of roller kilns for tile firing, the modernisation of the tableware sector and the pressing need for a product that could withstand much faster
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firing cycles. A tumultuous period in the late 1990s eventually saw all four Stoke-based kiln furniture companies – Norton, Diamond Refractories, Hewitt Refractories and Acme Marls – coming together as part of Sheffieldbased Dyson Ceramic Systems by mid-2000. Brian spent a short time out of the industry but rejoined Dyson in order to help with the transition of the Acme business to the Diamond site in Hartshill. He was subsequently made redundant a second time but says: “Redundancies can be traumatic experiences, but in my case it opened up a new opportunity with the offer
from Trend to assist with the promotion of their products on the worldwide market.” Brian did this for a number of years through a company called Cornerstone Ceramics and then, when Dyson struck up its partnership with Trend, he was asked to move to China in the role of Production Director. Jumping at the opportunity, Brian moved to Beijing with his wife, Annette, and in time was appointed to a technical sales position – a role that he has undertaken for the past 10 years. He has travelled globally during his time in the industry and has built up an extensive network of friends and contacts over the years. “The Trend factory, which
in 2003 was a series of small buildings, not always on the same level, is now a modern, single-level site with the latest production equipment. I have been immensely proud and privileged to have been a very small part in that transition,” adds Brian. “It is with personal regret but happiness that we announce the retirement of Brian Dodd,” said Trend’s International Sales Director, Steve Tingay. “Across a long and varied career, Brian has made a major contribution in production, quality, management and sales roles throughout the industry. We wish him and his family all the very best for the future.”
Editor’s note: Brian was always a lively, good humoured and kind individual who I had the great pleasure of knowing thoughout the lifetime of this magazine so far. As we approach our 20th anniversary later this year, it is with great sadness that he will not be working in the industry when we hit that milestone. The ceramics industry will miss his knowledge, character and friendship and I’m sure everyone will join us in wishing him a long and happy retirement. Good luck Brian… it’s been a privilege.
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International News
Pottery industry back from the brink United Kingdom
I
t's been through turmoil, with several major firms now expanding, can we safely conclude that the pottery industry is on the up? We're some way removed from the days, as recently as the late 1970s, when more than 50,000 people would pour out of Stokeon-Trent's pot banks at five o'clock. Indeed, if latest government figures are to be believed, in the whole of the UK the ceramics industry only employs around 8,000. The vast majority of those are in what government statisticians term the West Midlands. What they really mean is North Staffordshire. The government's 2016 report on the ceramics industry doesn't make particularly upbeat reading. It states that the ceramic industry's contribution to economic output (£550m) is down from 2009 as is the number of businesses. But then again statisticians are a soulless bunch. Looking beyond such figures, people in Stoke-on-Trent are seeing something different. In December, Colorado-based ceramics firm Mempro revealed it was relocating its headquarters to North Staffordshire as part of a £5million investment, moving on to Keele University's Science and Innovation Park. The news comes after Steelite International lodged plans to build a finishing and
packing facility at its Middleport factory and Emma Bridgewater unveiled a new distribution centre in Fenton. In the meantime, established producers are finding new markets in the Far East and China (the very areas which once so threatened their existence), the 'Made In Stoke-on-Trent' back stamp has regained its cache, Prince Charles can't stay away from the place, and the BBC has made pottery the new baking. It could well be the right time to tell the statisticians 'stick that in your pipe and smoke it'. The North Staffordshire ceramics industry has reinvented itself in a manner unparalleled since the heyday of Madonna. Emma Bridgewater, for one, is far from surprised that Stoke-onTrent is regaining its appeal to pottery manufacturers. "Here we are," says Emma, "right in the centre of Britain, great communications, real estate is as cheap as it could possibly be in the UK, and there's a great population ready and wanting to work. It feels like a wilfully ignored secret. I think we're turning a corner at the moment. There's a real sense of purpose and hope. It just feels like we could see some real meaningful change now." Emma, of course, first came to Stoke-on-Trent 30 years ago, just
as so many other manufacturers were on the verge of turning away. She ploughed on as other potteries crumbled around her and has now seen the industry come full circle. "The spirit of the city has completely changed," she notes, "there's some real grassroots resurgence going on. Tristram Hunt and I find ourselves saying this all the time to everyone – 'this is a fantastic place to do business – do you want some of it?'" If they do, there's plenty of opportunities at Ceramic Valley, the city's new 'ceramic enterprise zone, capitalising on the city's unique selling point as the World Capital of Ceramics', offering development opportunities not just to pottery manufacturers, but to other employers too. By 2019, 45,000 pieces of pottery will be made by hand each week at the Emma Bridgewater factory, with 70 new jobs created. "It's incredibly exciting to be expanding," says the entrepreneur, "creating 70 new local employment opportunities and be a part of rebuilding the community around our factory." That's not to say everything is totally rosy in the Potteries garden. The British Ceramic Confederation (BCC) has aired concerns over key points including energy costs, free trade, imports, and tariffs.
Brexit also raises issues, with Stoke-on-Trent South MP Rob Flello seeking reassurances about dumping of cheap foreign wares on the British market. "Since 2013," he says, "employment in the tableware and giftware sector has increased by 20%, and since 2011 employment in the floor and wall tiles sub-sector by nearly 40%. Half of the industry's exports have been sold in Europe, and in tableware there has been a boom of export sales to South Korea off the back of an EU-negotiated free trade deal. "When businesses in my constituency ask me how Brexit is likely to impact on their futures, I need to be able to tell them more than 'wait and see'." BCC chief executive Laura Cohen adds: "We don't want to encourage 'dumped' products coming here as that risks businesses and jobs. And with half ceramic exports sold in the EU, it is also no surprise we're anxious to avoid taxes and paperwork that could make UK-made products more expensive." If one thing shines out across the last four centuries of production, though, it is that the Potteries have proved themselves resilient. The ceramics industry will not let go of its revival easily.
“We are delighted to be working with Xaar. The two companies share a philosophy of delivering innovation to the ceramics market,” says Metco’s Graziano Vignali. Xaar-approved inks offer the tile manufacturers a range of benefits such as improved print performance, print reliability and improved throughput. All Xaar-approved inks go through the XaarDOT® fluid optimisation process which includes determining complex rheological characteristics of a fluid to identify and fix reasons for poor performance; materials
compatibility and lifetime testing to evaluate the effect of the fluid on the printhead and to establish fluid robustness; waveform optimisation to ensure greater drop placement accuracy as well as optimised operating voltage; and verification of the consistency and reliability of the fluid over a period of one year of heavy usage. In addition, Xaar-approved inks are warranted against long term damage to the printhead. This provides the reassurance that the fluid has been validated, approved and optimised to give unrivalled print performance and trouble free operation. The warranty differentiates XaarDOT® optimised fluids from other nonwarranted fluids.
Xaar and Metco join forces Europe
X
aar plc, the leader in industrial inkjet technology, is delighted to announce a new partnership with Italian ink manufacturer Metco Srl to deliver Xaar-approved Solvent Soluble Inks (SSI) for use in GS12C and GS40C variants of the Xaar 1003 printhead and the Xaar 2001 GS12C. Established in 1990 in Bologna, Italy, Metco was the first company in the world able to develop a set of completely soluble inks without using gold for magenta. These inks are used in the production of highly
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polished Lappato tiles found in commercial ‘high traffic’ locations such as shopping malls and public buildings. “We are delighted to be working with Metco”, says Duncan Gellatly, Manager, Global Ink & Application Support. “As you would expect from the market leader in ceramics inkjet technology, we have led the way in China bringing a digital solution to polished tile manufactures; we are now able to include a forward thinking company such as Metco in our portfolio of approved ink partners.”
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International News Unilin to expand storage facility United States
F
looring company Unilin is expanding its Thomasville facility with a 100,000-square-foot warehouse as part of a $36 million investment that will add 50 jobs and bring the company's total Triad work force to more than 350. The expansion was first reported by the Triad Business Journal in November. It comes as Unlin renames its Thomasville facility "Mohawk Laminate" as part of a marketing strategy for a company whose brands include American Olean, Bigelow, Daltile, Durkan, IVC, Karastan, Lees, Marazzi, Mohawk, Pergo and Quick-Step. Unilin was bought by
Mohawk Industries in 2005. The expansion, announced in January by the Davidson County Economic Development Commission, is the third local expansion for the company in recent years. Natalie Cumpton, the company's human resources manager, said the expansion represents another "exciting milestone" for the company's Thomasville plan. “Our production demand for premium laminate flooring made in the U.S. continues to increase," she said. "The company’s investment at Cloniger Road will create many exceptional career opportunities for people with technical skills
and automation experience. Steve Googe, president and CEO of the commission, said the new warehouse itself will not create new jobs but that Mohawk Laminate has already begun the hiring process for the 50 manufacturing jobs needed to boost production. "I think they are taking applications now," Googe said. "They opened their Denton Road facility back up and I know they use that as a training facility." Ad Tag - c1_2 (xs/xm/md) Googe said the company began rolling out the new name Mohawk Laminate at a trade show in Las Vegas in November. "Pergo was a licensee of theirs
and they bought them a couple of years ago, and so they were operating under all of these different names," Googe said. "So they just folded everything under the Mohawk Laminate heading. It is my understanding that they have changed the signing." He added that Unilin/Mohawk Laminate is a strong corporate citizen for the city of Thomasville, supporting United Way and the schools there. "For a community like Thomasville that is quite a benefit," he said. Unilin first established its Davidson County operations in the early 2000s with about 70 employees in a former Columbia Flooring facility on Denton Road.
Tile industry stages major comeback Italy
T
he Italian ceramic tile industry hasn’t had such a good year since 2008. Total sales are up 4.6% so far in 2016 — to more than 415 million square meters of product. Improvement is likely to continue over the next several years thanks to a weakening of competition from Chinese rivals on the raw commodities market. Domestic demand is stronger. These are a few of the numbers unveiled recently by the head of Confindustria Ceramica, Vittorio Borelli, at the year-end meeting to focus on the sector and on the Sassuolo district, the undisputed benchmark for quality, design and innovation on a global level. Italy is the third biggest ceramic exporting nation behind China and Spain. Some 85% of its more than €5.3 billion in tile turnover is from exports. “After ten years of constant declines,” said Borelli, “we are finally ending 2016 with an increase in sales in Italy, of 5.5%. We can’t toast to 85 million square meters sold domestically, because it was more than 180 million before the crisis, but the
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numbers show that we touched bottom and can only go up from here.” Exports are continuing to grow (+4.4% to 331 million square meters, according to the research department of Confindustria Ceramica and Prometeia), although down from the start of the year due to the increasingly uncertain geopolitical context, in line with trends globally (+4%). Sales to Nafta nations are running higher than average (+5%), as are those of the Gulf and the Balkans (+4.7%). Russia is down again (-10%), although less than in recent years. “We are seeing the results of strong investments in recent years,” said Borelli, noting the 23% increase in investment in 2015 and 27% the previous year, “which allowed us not to be gobbled up by foreign rivals and that is reflected an overall financial improvement.” A report by BPER bank on the financial situation of 64 Italian ceramic tile companies (a sample that represents 73% of the revenue realized by the 150 companies working in the
sector, more than 80% of them concentrated in the ModenaReggiano area) confirms the net improvement of margins (EBITDA at 13.4%) and income able to generate a strong flow of cash and improve capital levels. The outlook is good for next year as well. “I think a trend of around 5% is feasible for 2017 as well,” Borelli said, “between the stronger dollar that helps exports — even if it hurts us in terms of higher energy prices — a longer period of quantitative easing, and the Industry 4.0 plan, which anticipates another year of strong investments in technology. Doing business in Italy is anything but easy, but the weak link is Europe and a lack of defense of the manufacturing industry.” Brussels’ recent decision not to grant market economy status to China clearly garnered applause from the ceramic tile industry, “but the same European Commission also proposed a new rule with less strict antidumping fees than in the past and that worries us,” Borelli said. He is hoping for a “friendly” hand from
the European Parliament. Another risk for the industry is tied to the system of emission trading, “which instead of producing concrete results in terms of environmental impact,” is weighing down the sector with bureaucracy, “with a of haggling that creates costs and not benefits and threatens our global competitiveness,” he said.
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Raw Material News KENMARE ADJUSTS OUTLOOK FOR BRIGHTER 2017 Mozambique // Zircon Kenmare Resources has adjusted its production guidance for this year to between 950 000 t and 1.05-million tonnes of ilmenite, 5% to 16% higher than production for 2016, owing to increased utilisation and recovery rates at its Moma titanium minerals mine, in Mozambique. The miner further expects its zircon production to rise by 6% to 22% year-onyear to between 72 000 t and 83 000 t, while its rutile production is also expected to climb by 15% to 28% to between 9 000 t and 10 000 t. The higher production outlook comes on the back of record yearly and quarterly production of ilmenite, rutile and zircon. For the three months to December 31, the mine’s heavy mineral concentrate (HMC) production increased 55% to 474 300 t, while ilmenite output rose 35% year-on-year to 256 900 t, zircon production by 38% year-on-year to 20 000 t and rutile output by 35% year-on-year to 2 300 t. HMC production for the year ended December 31, totaled 1.41-million tonnes, up 28% on that produced the year before.
Ilmenite production for the full-year increased 18% to 903 300 t, while zircon output was up 32% to 68 200 t. Full-year rutile production was up 30% to 7 800 t. Total shipments of finished products for the year were up 28%, setting a record of 1.02-million tonnes shipped. Demand for ilmenite had grown strongly throughout 2016, resulting in significant price increases since the market bottomed in the second quarter, Kenmare noted. The company said the outlook for ilmenite prices remained positive for the year ahead, supported by low product inventories throughout the value chain and higher titanium feedstock consumption, as pigment demand continues to grow in line with global gross domestic product. Tyler said Iluka is committed to operating in a sustainable manner . “As such, Iluka will bring industry leading practices to the Sri Lankan minerals sector.”
MERGERS AND PARTNERSHIPS THE ORDER OF THE DAY KAISUN ENERGY TO LINK DKK AND MLHL China // Zircon After the memorandum of understanding was signed on August 10th last year, Kaisun Energy (08203) announced a three- party agreements with Daiichi Kigenso Kagaku Kogyo Co., Ltd DKK) and Mineral Land Holdings Limited (MLHL) on November 25th. The company will be coordinating zircon sands supply between DKK and MLHL. To be specific, it will provide sands purchased from MLHL to DKK as required. MLHL is a sands supplier controlling Duong Lam, which is a Vienamese plant manufacturing sands and flour. According to the agreement, DKK will make 100% deposit to Kaisun and Kaisun will urge Duong Lam to sell and deliver in time. Meanwhile sand quality requirement would be ensured by Kaisun so that DKK will allow its subsidiary VREC to accept the sands as specified. It is understood that DKK is a Japan-based zirconia and compound zirconia manufacture founded in 1956. It has always been focusing on the research, development and applications of zircon and compound zirconia. As global leading compound zirconia manufacture who takes up more than 50% of global market share, the company dominates the oxygen sensor supply in Japanese market. Besides, the company is one of the two manufactures that could convert zircon directly into products.
With higher cost-effectiveness, the company owns more technological edges than its counterparts. Meanwhile, elsewhere, on December 14, 2016, the M&A inspection commission of China Securities Regulatory Commission released its conditional approval of the application by Shenghe Resources Holdings Co., Ltd (purchasing assets by issuing shares). The comment reads, the applicant should complement its specific measures to maintain enterprise ownership stability after releasing this share issuing. Relevant independent financial consultants and lawyers shall give further specific advice. The major business scope of Shenghe is rare earth mining, manufacturing and sales, catalyst manufacturing and sales. Industry investment, rare earth metal sales, comprehensive applications and relevant intensive processing, technological consulting; rare earth new material manufacturing and sales. As the largest and technologically advanced titanium and zirconium manufacturing and processing company, Wensheng New Material mainly manufactures zircon sands, ilmenite, rutle, kyanite, monazite and stannary. After the merger, Chenguang Rare Earth, Kebairui and Wensheng will be the holding subsidiaries of Shenghe.
ANGER GROWS OVER POSSIBLE NEW MINE SITE Spain // Feldspar The rural agricultural communities of the Sierra de Ávila, where farmers maintain traditions which have developed over at least 300 years, are under threat from a mining concern which intends to extract feldspar from the area and which has been granted approval by the regional government of Castilla y León. The company applying for permission to mine feldspar is Antonio y Javi S.L, which is devoted to the sale of food, drink and tobacco. However, feldspar is a mineral which is used mainly in glassmaking, ceramics and the production of paint, plastics and rubber, and there have been plans to mine it in the Sierra de Ávila since 2008, when the rights were awarded to Antonio y Javi. Nonetheless it is only now that the company has presented their detailed project to exploit their mining rights, and an environmental impact study which has been carried out, and which claims that the effect would be minimal, is in the process of being accepted by the regional government. Unsurprisingly, the residents of Sanchorreja, La Torre, Narrillos del Rebollar and Valdecasa are not convinced, and are expressing concern over
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possible health risks as well as the effect on the landscape and their agricultural activities. Signatures are being gathered on petitions as the “No to the mine in Sierra de Avila” campaign grows, and residents are being warned of a possible connection between open-cast feldspar mining and cancer. Unfortunately for the protesters, an anachronistic piece of legislation from 1973 provides the feldspar prospectors with surprisingly strong backing: under the regime of General Franco mining was declared to be in the national interest, and this activity is therefore prioritized over property laws. In other words, the holder of mining rights in any given area is theoretically able to forcibly expropriate land from those who currently own it without having to pay any kind of financial compensation, as long as they offer an equivalent area of land elsewhere in exchange. A frightening thought for the farmers of the Sierra de Ávila, where concerns for the landscape and traditions of their home villages are undoubtedly made more pressing by the fact that their very livelihoods could be in danger.
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News
a
PRICE RISES ON THE CARDS
NEWS IN BRIEF
China // Ziron
Hainan Wensheng, the largest domestic concentrator, announced RMB500 per ton price hike for zircon sands during December, soon followed by other industry participants. That said, some of them were reluctant to sell as current stock levels were not high enough. Western suppliers such as Iluka have also indicated that they are going to raise price by US$5 per ton.
Domestic prices - China Average price October
Average price in December
Notes
Hainan Wenchang Zircon (RMB/tonne)
6,650-6,750
7000
inc. tax
Vietnam Zircon (RMB/ tonne)
6,600-6,750
6,700-6,850
inc. tax
Indonesia zircon (US$/ tonne)
900-920
900-920
2 tons bag/CIF
Iluka-MB (US$/tonne)
980
980
2 tons bag/bonded warehouse/bulk/CIF
Tronox (Tiwest) (US$/ tonne)
995-1,005
995-1,005
Bulk/CIF
Tronox (Namakwa) (US$/tonne)
940-950
940-950
2 tons bag/bonded warehouse
RBM-ZUG (US$/ tonne)
850-880
850-880
2 tons bag/bonded warehouse
RBM-ZSG (US$/tonne)
800-850
800-850
2 tons bag/bonded warehouse
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Since mid-December, Zhaoqing, Huizhou, Guangzhou, Chaoshan, Qingyuan and Foshan cities have been under environmental inspection, causing massive suspension in printing and dyeing, painting, aluminum milled products plants, tints, ceramics, stainless steel, furniture, plastic, hardware, jewelry processing, tin smelting industries. This has had the extra effect of raising Silicate prices in Foshan, premium silicate (ZrO2 64.5% min,D50=1.0Îźm) was around RMB9300- 9500, tax inclusive in cash, low-end (ZrO2 63.0%min,D50=1.2Îźm ) around RMB8000, tax exclusive.
NEWS IN BRIEF In December, Indonesian zircon sands was around US$900-920 per ton, CIF, and were predominantly shipped to a few established silicate manufactures as supply was tight. In addition, whilst Chinese sands suppliers were very willing to raise prices, Indonesian counterparts kept price unchanged during the month. However, it is expected that these will rise by US$20-30 per ton in this quarter and notification had been sent out.
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News Anaylsis
News
26
Riding the Bangladesh building boom
C
asian ceramics
onsumption of cement and steel, the two major ingredients for the construction industry, will record a dramatic growth in the coming years, riding on large infrastructure projects and increasing demand for the materials across the country. Positive macroeconomic fundamentals, including the impressive economic growth, government infrastructure projects including Padma Bridge and Payra Port, development of special economic zones, housing construction both in urban and rural areas, led by remittance inflow, and setting up of new industries indicate a “boom” in the construction material manufacturing sector. With regard to the steel industry, Bangladesh is one of the few countries that have performed extremely well when the global steel industry is going through a slowdown. The steel sector in Bangladesh has recorded a 15 percent growth in 2015 riding on infrastructure projects, including housing and public utilities, and the country is going to continue the growth exceeding 15 percent in the coming years. The steel industry witnessed a major growth especially during the last two years, as the political atmosphere and business environment were favourable, said SK Masadul Alam Masud, Chairman of Bangladesh Auto Re-rolling and Steel Mills Association. The local steel production was almost stagnant at 25-30 lakh tonnes per annum from 2008 to 2014. “But now the production capacity rose to around 80 lakh tonnes per year, and we are producing 50-55 lakh tonnes,” he said. The country relies on local manufacturing to meet the demand for steel, as local producers have developed the capacity of producing high quality steel products. The consumption will continue to go up in the coming years too as the country carries out its unfinished development works, he said. “Only 30 percent of development works have been completed, and 70 percent is yet to be done. It will take at least 20 more years to finish
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all these development projects throughout the country; so the industry will grow for the next 20 years,” he said. Manwar Hossain, Managing Director of Anwar Group, said the industry is booming. “Bangladesh is one of Asia's emerging steel markets and has a growing need for raw materials and steelmaking technologies.” The building materials division of Anwar Group has been dominating the construction industry for the last four decades with a diversified product mix, ranging from cement and cement sheet to mild steel bars, high strength deformed bars, galvanised sheet, uPVC pipe and fittings, and furniture and home decor. Hossain said the whole industry is undergoing a huge change as local manufacturers are replacing old technologies with new ones to ratchet up production. “Some companies have doubled or tripled their production capacity to cater to the rising local demand.” Steelmakers will invest about Tk 5,000 crores in the next two years, he said. The Anwar Group is also carrying out massive expansion in its building material manufacturing units to meet the growing demand for quality construction products. According to the World Bank's Bangladesh Development Update 2016, published in October, the construction sub-sector performed better in FY16, growing at 8.9 percent compared to 8.6 percent the previous year. Real estate, renting and business activities have also performed better, expanding by 4.5 percent in FY16 compared to 4.4 percent in FY15. In spite of the tremendous potential of the construction and real estate sectors, various factors adversely affected its development: land value distortions, absence of secondary property markets, limited asset securitisation and sale of mortgages, and weak backward linkage industries such as cement, ceramic, and brick manufacturing industries. The real estate business recently recovered due to property price corrections, falling interest rates on home loans and sustained political
stability. The number of unsold ready apartments declined to 8,000 from 22,000 a couple of years back. The recent decline in lending rates is expected to further boost apartment sales. However, the terror attack in Gulshan has dampened the prospect of a faster revival. The construction sector now accounts for about 8.9 percent of GDP, employing around 3 million people, and accounting for 5.1 percent of the employed labour force in 2015, according to the World Bank report. Bangladesh's per capita steel consumption is only around 35 kg, which is 65-70 kg in India and 200250 kg in Thailand, and the world average per capita steel consumption is over 200 kg. On the other hand, the per capita cement consumption is only around 120 kg, which is 220 kg in India, 310 kg in Sri Lanka, 170 kg in Pakistan, 320 kg in Malaysia and 1,700 kg in China. “The low consumption showed that the potential is huge,” said Mohammed Jahangir Alam, Chairman of GPH Ispat Group as well as Crown Cement Group. Apart from the ongoing infrastructure developments such as Padma Bridge and Payra Port, the government needs to carry on its development works across the country to retain the present economic growth, he said. “The private sector is also vibrant now in the backdrop of a stable political atmosphere and a favourable business environment. Many individual entrepreneurs are setting up new industrial units,” he said. “We also have the opportunity of reaping the benefits of our demographic dividend at least for the next 20-25 years. So the construction industry will obviously grow, as Bangladesh is on its way to completing its unfinished development works,” he added. Bangladesh has an installed production capacity of 4 crore tonnes of cement a year while the utilised production capacity is 3.2 crore tonnes of cement per annum. The country is capable enough to meet the local requirements of steel and cement.
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Analysis: Heavy clay
Building blocks
the logistics and economics of South Asia’s brick Yogender Malik looks at how the logistics of Southern Asia’s brick builders and suppliers is proving to be one of the key issues in the profitability of the sector.
A
sian countries are the largest producers of bricks. Globally, the brick industry produces 1.5 trillion bricks every year, of which 87 per cent are produced in Asia, with China leading with 67 per cent of the global production. India is the world’s second largest producer, with about 230 billion bricks manufactured each year – the fertile alluvial regions of the IndoGangetic plains produce over 65 per cent of the country’s bricks. Other South Asian countries- Pakistan, Bangladesh and Nepal are also significant players in the global brick industry. Cumulatively, these three countries produce 66 billion bricks per year. Despite the record level of brick production in these countries, there is a further scope of record growth in these countries as most of the countries of the region have a massive “underconstruction” agenda – as much as 70 per cent of India, for instance, is yet to be built. Vast quantities of material are going to be needed to build homes, offices and factories. In order to minimize the production cost and improve profitability, South Asian brick makers, a majority of whom are small and medium enterprises (SME’s) are undergoing a gradual makeover through the adoption of mechanisation following the entry of international technology providers and producers. Entrepreneurs are also bringing in product innovation.
India
With an estimated annual production of 230 billion bricks a year, India is the second largest brick producer globally. There are about 105,000 small and mid scale brick kilns in the country.
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Brick-making is one of the most unorganized sectors in India with an estimated industry size of more than INR 60,000 crore. It has also continuously grown over the years on account of a rapid increase in the demand for physical buildings and infrastructure. Fixed Chimney Bull’s Trench Kiln (FCBTK) is the main brick kiln technology accounting for 70% of the production. India’s brick sector is characterised by traditional firing technologies, reliance on manual labour and low mechanisation rate together with the dominance of small-scale brick kilns, single raw material (clay) and lack of institutional capacity for the development of the sector. Considering these factors along with the market size and demand potential of brick in construction activities, several opportunities exist in Indian brick industry to improve resource efficiencies and lower the production cost. Brick production in India depends on soil as its major raw material and coal and other biomass as fuel. For the brick current level of production, Indian brick industry consumes around 350 million tonnes of good quality soil and around 25 million tonnes of coal (fourth largest consumer of coal after power, steel and cement sector) along with huge quantity of biomass fuels every year. Highly labour intensive and marred by usage of outdated production technology, Indian brick production sector started to witness entry of automated production plants in the first decade. Usage of these automated plants gained momentum after the entry of Austrian heavy clay major, Wienerberger AG. Wienerberger India was set up in 2006 as a wholly-owned subsidiary of Wienerberger AG in Bangalore. The company
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Analysis: Heavy clay
Brick production Number of Bricks produced/ year
No. of kilns
Type of kiln
Number of people employed
Number of bricks produced/ employee
230 billion
105,000
FCBTK & Clamp
10 million
23,000
Pakistan
38 billion
11,000
MCBTK & Clamp
9 million
4222
Bangladesh
20 billion
5,600
FCBTK & Zigzag
2 million
10,000
Nepal
8 billion
700
BTK & Clamp
600,000
13,330
China
980 billion
78,000
Hoffman & Tunnel Kiln
6 million
163,000
Country India
commissioned a state-of-the-art manufacturing facility in Kunigal, 70 kms from Bangalore in 2009 to produce Porotherm clay bricks and since then has constantly increased the production capacity at this facility to meet the market demands. The company claims that products manufactured in Kunigal offer significant technical advantages over conventional walling materials apart from being cost effective and environmentally friendly. The company claims that its Kunigal plant is one of the most technologically advanced brick manufacturing plant with chamber dryer and a tunnel kiln based on pet coke and LPG. The plant has a production capacity of around 6600 tons per day (60,000 blocks/ day of hollow blocks of 200 x 200 x 400 mm dimensions and having a weight of 11 kg). Post 2008, a number of fully and semi automated production plants become operational in India. Currently, there are about 35 plants across India, including semi-automatic and fully-automatic ones. Many other modern plants are under construction. Increased difficulties in handling labour, maintaining quality and meeting the increased demand for better-quality bricks have forced brick kiln entrepreneurs to rethink their production processes and also led to product innovation. As a result, many entrepreneurs are diversifying into resource efficient bricks (REBs) by importing machinery from overseas. Majority of these plants are located in the Southern states of the country. However, in last three years there have been nine such installations in the Eastern and Northern parts of the country. These highly automated plants have enabled the producers to lower the overall production cost and offer better quality products to the consumers. Hollow bricks, which were introduced in the Indian market in the year 2009, have become common in a number of new, high end construction projects.
Bangladesh, Nepal and Pakistan
Brick production industry in the other three South Asian countriesBangladesh, Nepal and Pakistan is almost identical in nature to that of Indian industry. Dominated by a large number of unorganized players, who are scattered in and around the major cities, the brick sector in these countries is dominated by age old production methods.
Economics in South Asian Brick Sector
High usage of in-efficient and outdated technology, heavy reliance on unskilled labour and seasonal nature of brick production makes South Asian brick operations quite uneconomical at first glance. Brick kilns are estimated to consume 130 million tonne of coal
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in Asia – with China alone using 70 million tonne. Kilns have huge variations in efficiency and it could take anything between 11 to 70 tonne of coal to fire 100,000 bricks. In India, brick kilns consume about 35 million tonnes (MT) of coal a year, making them the second largest industrial consumer of coal after the steel industry. In Pakistan, brick production accounts for 54 % of all coal consumption. Bangladesh consumed 3.51 million tons of coal in 2015 to produce 20 billion bricks. In all these South Asian countries, inefficient combustion of coal and heat losses in brick kilns results in a large loss of energy and economic resources. Adoption of energy conservation measures in existing brick kilns and adapting to automation will not only result in very large fuel savings (30-60%) but also in reductions in black carbon and CO2 emissions, improvements in the incomes and working conditions of workers, and production of better quality building material. Currently, environmental cost due to burning of coal and other bio-mass fuels are not big constraints for brick producers in the region are not on the high- priority list for a number of producers in the region. However, as environment consciousness and regulator frame work becomes more stringent, this cost will also play a major role in the economies of brick industry in the region. In a move in 2016, the Pollution Control Board of Northern state of Uttar Pradesh in India asked brick kiln owners of Ghaziabad, Gautam Budh Nagar and Hapur to upgrade their technology from natural draft brick kilns to induced draft kilns within 90 days.
Logistics
Being a bulky material, logistics is one of the most important issues in the profitability and success in the brick sector. Shipping of finished products to final destination, acquisition and delivery of raw materials, which are equally bulky at most economic rates is perhaps the single largest issue at the planning stage of establishing a brick kiln. In India, the large numbers of brick kilns are distributed in and around centers of consumption. Places like Meerut, Ghaziabad, Sonipat, Gurgaon and Rohtak around National Capital region are dotted with a number of brick kilns, which cater to brick demand of National Capital and the extended region. Similarly, region around Mumbai and other major and rapidly constructing cities in the Western region like Ahmadabad, Surat, Pune have a large number of brick kilns meeting the demand from these cities and nearby region. Proximity of brick kilns to the end users enables the brick kilns owners to meet the demand of customers at minimal transportation prices (Though the freight is always borne
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Analysis: Heavy clay
Comparison of kiln energy usage Specific Energy Consumption (MJ/ Kg of fired brick)
Specific Coal Consumption (tons/ 100,000 bricks)
VSBK ( India, Pakistan and Nepal)
0.7-1.0
11-16
Fixed Chimney BTK ( India)
1.1-1.5
18-26
Moveable Chimney BTK ( India)
1.2-1.8
20-27
Tunnel Kiln ( China)
1.3-1.6
20-24
Modern Tunnel Kiln ( Europe)
1.1-2.5
16-40
Kiln Type
Note- Specific coal consumption corresponds to gross calorific value of coal as 18.8 MJ/kg ( 4500 kcal/kg ) for a fired brick weight of 3 kg.
by the end users). Speaking to Asian Ceramics, Bharat Chabra, owner of a mid-sized brick kiln at Ranipur in Bhaghpat, Mojo Brickworks ( Meerut district), “Transportation of finished bricks from our factory premises to the construction site varies according to the distance, state levies ( in case we have to ship it to other state than ours) and regulations. In a number of cases, we have seen builders opting for low quality products in order to save on the transportation cost. These builders will opt for bricks produced at the nearest brick kilns from their construction site in order to minimize the transportation cost, even though the quality of these products is not top notch.” Jaspreet Singh, owner of Singh Brick Company, which has three brick kilns around city of Chandigarh in North India told Asian Ceramics the importance of logistics in the brick industry, “ Our company was losing a sizable number of orders from existing clients at their construction sites due to high transportation costs. These customers have opted to go for brick works, which were at a distance of 28 Kms from their construction site as compared to ours, which is 66 Kms away. Distance of an additional 38 Kms made our products expansive by INR 2200 ( for 2000 bricks- A normal truck load). The transportation cost differential becomes very important in an industry like ours, where price of 1000 bricks ranges from 3200- 4600 (depending on quality).” In Eastern region, a few large clusters of brick kilns are located around the major consuming market of Kolkata and other major cities. In comparison to North and Western markets, the number of brick kilns and demand is less due to stage of economic development and use of alternate building materials (wood is used in a number of constructions in the North Eastern states due to earthquakes).
Resistance to change
South Asian brick industry is a huge economic sector employing many million people and consuming sizeable amounts of energy, mostly in the form of coal and other bio-mass resources. It is a very conservative and change-resistant industry, but has a very interesting potential for change. If it does change, energy savings and better quality products could transform the face and
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dynamics of the industry. In South Asia, there is a strong resistance to change as the conventional way of firing bricks is quite profitable and does not require high initial investments. Although more modern kilns provide significant savings in energy, they also require higher initial investments. The situation is quite similar to an energysaving lamp (LED light) where the initial cost is higher but savings are possible through lower energy bills and a longer lifespan. However, there is another facet of the problem. Operating modern kilns demands a commitment from management compared to the traditional brick kilns: these are well-known technologies and the kiln owner does not have to know anything about firing and other nitty-gritty. He can just hire migrant firemen and labourers and he has to overlook the kiln once a day; his most important job is to look after the cash-box. Automated kilns, on the other hand, require a number of commitments on the management side: 24-hour operation in several shifts and fixed investments. With a drying shed for green bricks the kiln can be operated the whole year round. " But why should I bother to work the whole year round when I can make all my money within 6 months, "says, Jarnail Singh, a brick kiln owner in Faridabad, near Delhi.
Government initiatives
Government of South Asian countries have taken various steps in recent years to modernise and achieve economies of scale in their respective countries. For example, government of India aims to transform country’s brick sector through National Brick Mission by facilitating large-scale adoption of technologies for cleaner
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Analysis: Heavy clay
fired brick production and finding alternatives to fired clay brick. It hopes to roughly halve GHG emissions as well as fuel and clay consumption. As much as 600 million tonnes of clay a year is used every year for bricks, which damages topsoil, especially at riverbanks. The key elements of the strategy include moving away from solid clay-fired bricks in the market to hollow clay-fired and flyash products. The mission, which is expected to cost Rs 70 billion, will be set up at both national and state levels. It will be an autonomous body under the ministries of urban development and housing, and urban poverty alleviation. Government of Bangladesh is trying to clamp down on the industry through regulations mandating the use of cleaner technologies. The most common but highly polluting Fixed Chimney Kilns (FCKs) are now gradually being converted to coalbased Zigzag kilns and gas-based Hoffman kilns. However, the adoption of cleaner, gas-based technologies is hampered by a serious gas shortage, as the brick industry is on a lower priority due to the seasonal nature of their operations. However, for its rapid transformation, the South Asian brick industry would require a comprehensive set of regulations from the respective governments which addresses resource efficiency, environmental pollution; occupational health; decent working conditions; and –most importantly – new brick quality standards.
Outdated technology
Outdated technology is the single largest factor behind the poor performance of South Asian brick manufacturing industry. The question for South Asian countries is how to improve technology, particularly in the informal sector, which uses cost effectiveness as its selling point. These countries are working on different policies – from banning inefficient and highly polluting kilns to developing new materials (hollow and fly ash bricks). But it is clear that as yet, the efforts have not obtained overwhelming success. The technology employed determines the fuel usage and economics of brick production from a brick kiln. The FCBTK – which produces more than 65 per cent of the bricks made in India – is highly resource-intensive. Clamp technology is equally polluting but because it does not have any fixed structures, the initial cost of setting up the kiln is very little, but fuel usage per unit of production is higher than FCBTK. The zigzag kiln, introduced in the 1970’s is an improvement over the FCBTK. It requires air to travel through a zigzag path, which makes it more economic in producing bricks. A tunnel kiln is much more expensive to set up and requires much less human power in comparison to an FCBTK or a zigzag. It is considered to be the best technology available till date for large-scale production of bricks and is widely used in industrialised countries. The advantages of tunnel kiln technology lie in its ability to fire a variety of products; good control over the firing process; ease of mechanization, thus reducing the labour requirement; and large production volume.
Labour: boon or bane?
Availability of cheap and abundant labour force in South Asian countries for brick making has proved to be a double edged sword for the region’s brick industry. On the one hand, it has kept the total labour cost low for the producers, but on the fillip side it has been the largest deterrence to the modernization of the brick industry. At least three brick kiln owners in the state of Haryana made
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Comparison of Main cost & revenue Drivers from different kilns VSBK (Vertical Tunnel Kiln Shaft Brick Kiln)
FCK (Fixed Chimney Kiln)
Zig- Zag Kiln
Unit Brick Price
4.2
4.2
4.2
4.9
Coal cost efficiency/ 1000 bricks
1540
1310
770
770
Labour cost efficiency/ 1000 bricks
1560
1560
940
80
0
0.47 million
2.7 million
39 million
Kiln Type
Annual Financing cost
India: brick industry cost breakdown Wastage 5% Administration & sales 5%
Raw Material 15%
Fuel 45%
Labour 30%
similar statements on the economics of brick production. They told Asian Ceramics, “As long as poverty remains in the country there will be no shortage of cheap labour for brick making. There are hardly any incentives for brick kiln owners to invest in better working conditions or in modernization, as long as it is cheaper to mine clay without any regulations and mould bricks by hand, there will be no machines.”
The future of automation
Increased adoption to automation by a number of players in the brick production is one of the key developments of South Asian heavy clay industry. Though, the number of these plants is still miniscule, but the entry of these automated plants has created a much needed awareness in the sector and a number of mid scale players are increasingly opting for automation of key steps in the brick production process. According to Monnanda Appaiah, Managing Director of
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Analysis: Heavy clay
Wienerberger India, “Ours is highly automated facility, engaging robots for material handling and adopted to efficient use of locally available raw materials and energy resources to produce green and sustainable bricks for the Indian Market. Our endeavor from the very beginning was to use an extremely Resource Efficient Brick (REB) without compromising on quality and strength. We developed our flagship brand, Porotherm Smart Bricks, whose
India fights pollution issues
Central Pollution Control Board (CPCB) has recognised the brick production industry as a highly resource and energy intensive and polluting industry owing to prevalence of obsolete production technologies. While, the clusters are the source of local air pollution affecting local population, agriculture and vegetation; at a global scale they also contribute to climate change. The brick industry competes for resources with other sectors, which poses a significant challenge to the sector. Coal is one such resource that is required for the power, steel and other crucial sectors. Also, top soil or land which could be used for agriculture. The traditional kiln unit itself occupies considerable land area and is subjected to high temperature making it unfit for agricultural activities (after the site is abandoned). The fast depletion of arable land thus caused due to brick making is a matter of concern to India regarding food security. With an average consumption of 18 tonnes of coal per 100,000 bricks, the brick sector consumes about 24 million tonnes of coal per year which is about 8 % of the total coal consumption of the country (third largest consumer after power and steel sector). In addition, it also consumes several million tonnes of biomass fuels. The share of energy in total cost of brick production is 35-50 %. The large coal consumption of the brick industry is the cause of significant air pollution in terms of carbon dioxide (CO2), carbon monoxide (CO), sulphur dioxide (SO2), nitrogen oxides (NOx) and suspended particulate matter (SPM). The large amounts of coal used for brick firing also leave behind bottom ash as residue. The air pollution and bottom ash generated cause considerable health problems, especially related to respiratory health, while also causing damage to property and crops. The Supreme Court of India issued a directive for discontinuing the movable chimney kilns and for all brick kilns to conform to new environmental norms. While this signalled a move in the right direction, due to lax monitoring mechanisms such kilns continue to function and flout environmental regulations. Additionally, while kilns with higher production levels and capital have the option to changeover to fixed chimney type BTKs, the small and medium
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design allows maximum benefits with almost 60 per cent less resource usage.’ Appaiah further adds. “Over the years, we have delivered our products to varied projects like large apartments, villas, educational institutes, hospitals, hotels, commercial complexes and individual houses. Our smart brick materials have especially helped in achieving savings from high rise structures.” scale brick entrepreneurs are confronted with environmental regulation without having financially viable options to switch and thus continue to run polluting kilns.
Socio-economic issues
The workers in the brick industry are subjected to extreme working conditions and poor remuneration. Currently in India, brick manufacturing is a labour-intensive sector, with crude techniques causing considerable worker drudgery. They are also exposed to high concentrations of Respirable Suspended Particulate Matter (RSPM), during monitoring and regulating the fire, as the furnace chamber is covered with ash (ash acts as insulator). As well as during the manual mixing of fly ash and clay and due to the open dumping and storage of fly ash. Transportation of green and red bricks is done by a head load of 9 to 12 kgs causing health problems, especially in women. Even though the brick workers are exposed to these occupational hazards, coverage under any sort of insurance or medical facilities is virtually unheard of. In the brick sector, labour is brought in through a contractor (from distant places). Since they are not on the payrolls of the kiln owner, they are not covered under the current labour laws, e.g. Minimum Wages Act. The work force is paid on basis of quantum of work and against completion of certain tasks such as moulding of 1000 bricks, transportation of 1000 green bricks etc. The seasonal nature of brick production generates employment for a limited period of six - seven months in a year. Majority of the workforce has no option, but to engage as labourers (generally as agricultural labourers) for the rest of the year. The nature of the work requires skilled labour especially for moulding and firing. There is large scale migration towards the major brick production clusters every season due to this. These tasks are traditionally handed down from father to son in the communities. The last few years have seen a labour shortage as the newer generation does not want to be associated with the brick sector any longer. A phenomenon observed in certain clusters due to this shortage is the hoodwinking of entrepreneurs by labour by promising their services to multiple owners, taking advances and not turning up. Labour rates have also gone up driving down margins for kiln owners.
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Analysis: Sanitaryware
To squat, changing fortunes of the WC
Rohan Gunasekera looks at how changing market dynamics are affecting the requirement for the traditional squatting pan, as the rise of the WC continues.
G
rowing affluence, rising urbanisation, aging populations and the impact of Western cultural influences will eventually lead to more demand for Water Closets (WCs) in the Asian region. But a pronounced shift away from traditional squatting pans will take some time to happen and for the immediate future both types will be in demand. Given that many people in the region are poor and live in rural areas, and millions of people are still without basic sanitation facilities and defecate in the open, such as in countries like India, manufacturers will continue to produce both types of sanitary ware on their production lines, using both the traditional and more ad-vanced, automated casting methods. High pressure casting lines are fast but cost more than tra-ditional machines and are more suitable for origins where the manpower cost is very high. Squatting pan manufacture is largely done by the innumerable small-scale producers in the re-gion although some of the brand-name sanitaryware majors do include the type in their product portfolios where preference is given to the higher-margin WCs. In the more developed econo-mies of the region, such as East Asia and West Asia or the Arabian Gulf, replacement needs are an important drive of demand. In the developing nations such as in South Asia, increasing pop-ulation and increasing standards of living will drive the market. The belief, backed by science, that squatting is the healthier, and superior, method, and the view by many that sitting on commodes is unnatural, along with lower price, should mean continued demand for pans, especially in rural areas as well as low income urban areas. Some of the sani-taryware majors, like those in Japan, are taking these cultural preferences into consideration and designing and manufacturing WCs that enable users to remain seated but also exploit the pos-tural benefits of squatting. In Indonesia, the most populous of the Association of Southeast Asian Nations (ASEAN) members, with 250 million people, and the grouping’s largest economy, around 60% is still using squat pan toilets. This indicates the potential market for WCs given the eventual expected shift towards sitting toilets. Indonesia is home to one of the largest production lines of Japan’s TOTO, with eight kilns and a fully automated line with an annual capacity of almost five million pieces. TOTO commands about 65 70% of the Indonesian market, and exports about 30% of production.
36
asian ceramics
AC 17-1
Status quo
For the moment, though, the Indonesian sanitaryware industry is facing an oversupply situa-tion, demand having slowed as the country’s economic growth slackened. “Now our annual WC production capacity is around 2.3 million pieces but demand is only for 1.8 million pieces. So there’s over-capacity,” Elisa Sinaga, Chairman of the Indonesian Ceramic Industry Associa-tion (ASAKI), told Asian Ceramics. “Demand is reducing because our economy is now slow-ing down. Economic growth is less than 5%. Three years ago it was over 7%. But this overca-pacity is only for the next year. After that it should achieve some balance and in the next two years we’ll need more capacity.” Sinaga says pans are produced mainly by large numbers of small firms, making calculation of total installed capacity difficult. It s estimated to be around 3.6 million pieces a year and serves low income people. An economic recovery is expected, starting around mid-2017, and demand for sanitaryware should start to increase again, he says. Normally, sanware demand growth is around 10% a year. Sinaga feels some manufacturers may start investing in new capacity this year or in 2018 since it takes about two years to build new plant. Manufacturers use mainly conventional or manual casting processes Expansions planned by some ASAKI members were postponed because of higher natural gas prices. In Indonesia the energy cost is still higher than in the rest of ASEAN – about $9 per mmbtu compared with $6 per mmbtu in Malaysia. In the rest of the ASEAN region, countries with higher economic growth like Thailand and the Philippines should see more demand for WCs and consequent expansion of capacity. “Thailand is one of the ASEAN countries where the ceramic industry still has good prospects, especially sanitaryware, as they export to many Asian countries,” says Sinaga. “Demand is mainly for WCs in countries like Thailand and Malaysia whereas in the Philippines pans are more in de-mand as economic growth is lower and the rural population is large. But with economic growth, people will switch to WCs.” India, where 600 million people don’t have access to a toilet and defecate in the open, is the se-cond largest sanitaryware market by volume in the Asia Pacific region with the biggest chunk of the market accounted for by pans to meet demand mainly from low income
www.asianceramics.com
Analysis: Sanitaryware
or not?
people in rural areas. Demand for pans is also high in low income urban areas where an estimated 19% of urban homes not having a toilet. The government’s ‘Swachh Bharat Mission’, to rid the country of the problem of open defecation, and efforts in educating people about safe sanitation will give a fillip to sanitaryware demand, especially in production of squat pans. With India being one of the fastest growing economies, rising living standards and increased per capita disposable income which has created an expanding middle class, demand for WCs is also rising fast. Demand for these products is highest in the residential sector but public utilities like malls, hotels and hospitals have also contributed to demand.
Smart city boost?
According to rating agency Crisil, the government’s emphasis on developing 100 smart cities and improving sanitation will be one of the industry’s growth drivers, which although unlikely to directly impact the
organised players, may help expand the addressable market. Sanitaryware majors will benefit from a faster shift from the unorganised (30-35% of the market) to organ-ised segment because of the GST implementation, growing affinity for branded products; and rising disposable income. Currently, India faces a severe housing shortage of around 107-115 million, of which about 60% of demand is from rural areas. To bridge this gap, the government has introduced several schemes to promote mid-income housing. Also helping drive demand is the easy availability of cheap housing finance with interest rates having come down from about 14% in 2000 to around 10%. Replacement demand now constitutes only 10-15% of total demand in India, while globally it accounts for 75-80%. But in future, with income levels moving towards global standards, re-placement demand is expected to follow a similar pattern and lead to shortened replacement pe-riods, which augurs well for the sanitary ware players. Hindustan Sanitaryware Limited (HSIL), the largest player in
Ceramic sinks, washbasins, washbasin pedestals, baths, bidets, water closet pans, flushing ... Exporters
World
2011
2012
2013
2014
2015
Exported quantity, Tons
Exported quantity, Tons
Exported quantity, Tons No Quantity
Exported quantity
Unit
Exported quantity, Tons
No Quantity
No Quantity
No Quantity
No Quantity
No Quantity
Mixed
80,971
132,915
148,681
Association of South-East Asian Nations (ASEAN) Aggregation Thailand
58,714
Tons
56,977
68,106
75,793
79,216
Viet Nam
27,829
Tons
No Quantity
40,910
45,338
35,534
Malaysia
11,487
Tons
11,044
11,577
15,604
11,797
Indonesia
8,874
Tons
9,254
7,893
9,791
10,215
Philippines
3,920
Tons
3,636
2,742
966
1,304
Brunei Darussalam
8,881
Units
59
80
99
137
0
1
0
9
5
3
Cambodia
0
Lao People's Democratic Republic Myanmar
0
Tons
1
4
4
1
Singapore
727
Tons
No Quantity
1,602
1,081
No Quantity
Sources: ITC calculations based on UN COMTRADE statistics. The world aggregation represents the sum of reporting and non reporting countries The quantities shown in dark green are estimated by ITC. The quantities shown in light green are estimated by UNSD.
www.asianceramics.com
AC 17-1
asian ceramics
37
Analysis: Sanitaryware
sanitaryware, believes consumer preferences are changing from low end basic products towards middle and high end premium products. HSIL has manufacturing facilities in Bahadurgarh, Haryana with an annual capacity of 1.8 million pieces and in Bibinagar, Telangana with a capacity of 2.0 million pieces. Recent growth in sanitaryware has largely come from the Tier-II and Tier-III towns with the large towns still under pressure because of the slowdown in the real estate market. HSIL says it is very strong in the retail segment and has been penetrating more and more in the areas Tier-II and Tier-III towns which were not covered earlier, expanding its dealer network and sub dealer network. Roca Bathroom, the second largest player, has made a lot of efforts in the last three years to in-crease the production capacity. The group is operating seven factories in India for different products with total installed annual capacity of sanitaryware at 6 million pieces. Four vitreous china manufacturing facilities are located in Ranipet (0.8 million pieces per annum) and Perun-durai (2.4 mppa) in Tamil Nadu, Dewas (2.4 mppa) in Madhya Pradesh and Alwar (700,000 ppa) in Rajasthan. The company says low inflation, easier business environment and low ener-gy cost has made India more competitive than China, enabling it to not only produce more in India but export to many countries as well. Cera Sanitaryware Ltd (Cera), the third largest player, has postponed plans to expand its capaci-ty to 3.3 million pieces per annum, from 3 million now, by a couple of quarters, considering the weak demand outlook. The firm is considering expanding capacity, either through a brownfield or greenfield expansion, once demand revives. Its manufacturing plants for sanitary ware and faucet ware are located in Kadi (Gujarat). It has a sanitary ware market share of 23-24%, has a well-entrenched positioning in the mass- and midmarket segments of sanitary ware, and is now aiming for the premium segment of sanitary ware in its quest for higher growth. The presence of UAE-based RAK Ceramics in Bangladesh signifies the potential of that mar-ket, given its large population and relatively low levels of sanitation and economic growth. There are 16 companies producing sanitary-ware products in Bangladesh. With capacity utilisa-
tion exceeding 100% in the last five years, as a part of expansion plan, RAK’s Bangladesh unit increased its annual capacity by 31% - by 350,000 pieces of sanitary ware from 1.1 million. It is estimated to have about two-thirds of the market.
Transition time
Sri Lanka is a good example of a country in transition, having risen from low income status to join the ranks of the lower middle income nations soon after its 30-year ethnic war ended in 2009, triggering an economic boom. The island, with a population of about 22 million, is highly urbanised – with an urbanised rate of over 50% - and the postwar construction boom has made tile and sanitaryware manufacturers some of the most profitable and sought after firms on the Colombo bourse. Although the industry is protected by high import tariffs, imported tiles and sanitaryware account for a big part of the market. Future demand for sanitary ware is clearly in WCs, says Nimal Perera, Managing Director of Royal Ceramics Lanka (RCL), a group which dominates tile production, having acquired two competitors, and diversified into sanitaryware with its Rocell Bathware Ltd. subsidiary. RCL group has a market share of about 70% for floor and wall tiles and around 50% for bathware. “Gradually, people are moving into WCs, as they get more educated and more affluent,” Perera told Asian Ceramics. “Many people are converting from Asian toilets – squatting pans – to Western types. A lot of people are going into bidet spray toilets because of space and cost fac-tors.” RCL recently introduced bidet spray toilets like those made by TOTO of Japan with elec-tronic seats and remote control. The company makes both WCs and pans on its production line, to provide some balance in its firing cycle, although WCs are the majority. “The production cost of pans is very high so it is very difficult to compete with cheap imports,” says Perera. “Margins are very low for pans and we can’t sell at a high premium, unlike other items. So it’s not worth putting more effort to producing pans.” Most imports of pans come from India, China and Thailand. RCL finds the demand for pans is trending downwards. “Whoever builds a house wants to put WCs,” says Perera. “Pans
Ceramic sinks, washbasins, washbasin pedestals, baths, bidets, water closet pans, flushing ... Importers
World
2011
2012
2013
2014
2015
Imported quantity, Tons
Imported quantity, Tons
Imported quantity, Tons
No Quantity
No Quantity
No Quantity
95,907
113,486
Imported quantity
Unit
Imported quantity, Tons
No Quantity
No Quantity
No Quantity
Association of South-East Asian Nations (ASEAN) Aggregation
Mixed
Philippines
24,201
Tons
20,205
21,204
29,152
36,646
Thailand
17,828
Tons
22,923
24,038
25,318
25,765
Malaysia
7,633
Tons
7,338
10,123
11,015
12,593
Indonesia
12,597
Tons
17,588
10,756
12,324
10,176
Myanmar
5,603
Tons
No Quantity
8,749
12,566
9,873
Viet Nam
3,304
Tons
No Quantity
3,597
4,533
7,163
Cambodia
2,762
Tons
2,126
3,062
3,849
4,855
No Quantity
No Quantity
No Quantity
3,263
3,493
3,142
Brunei Darussalam
140,158
Units
1,409
1,405
849
716
Singapore
12,069
Tons
No Quantity
9,710
10,387
No Quantity
Lao People's Democratic Republic
Sources: ITC calculations based on UN COMTRADE statistics. The world aggregation represents the sum of reporting and non reporting countries The quantities shown in dark green are estimated by ITC. The quantities shown in light green are estimated by UNSD.
38
asian ceramics
AC 17-1
www.asianceramics.com
Analysis: Sanitaryware
are only in remote, rural are-as, some housing schemes and factories and sometimes in houses and commercial buildings for drivers’ and servants’ quarters. The middle and upper classes use WCs. RCL uses both pressure casting and traditional battery casting on its production lines at its fac-tory in Homagama, on the outskirts of the capital Colombo, all supplied by Sacmi. Pressure casting is mainly for WCs. Future investments will be in both types of casting processes. RCL recently bought another battery casting line. The company has been considering setting up plants abroad, mainly tiles, with Bangladesh one destination, because of rising domestic costs and when it faced problems sourcing raw domes-tic materials. The raw material sourcing problem has been solved and it has so far not made the decision to manufacture overseas. Perera believes that in the region too future demand will be more for WCs as countries in the South Asian region get richer and people develop higher aspirations, although pans would still be in demand in rural areas. “Most countries getting into the next income level and people are moving away from pans to Western toilets,” he says. “Also people are more ducted than 30-40 years ago. And more have access to pipeborne water connections. Even if they do not, they have pumps for well water. Everybody wants to have a proper bathroom in the
house. Also, the younger generation are more exposed to and prefer WCs as many schools have modern ameni-ties, not squatting pans.” RCL plans to double bathware capacity, having recently invested Rs500 million on expansion. The company is now producing 1819,000 pieces a month or 600 a day. The addition of a new shuttle kiln, again from Sacmi, will double production capacity to 36,000 pieces a month, which Perera estimates will be adequate to meet demand for the next five years or so. Aging populations in Asia is seen as another driver of demand for WCs as the use of squatting pans is more difficult for the elderly. In Thailand, for instance, where the population is rapidly aging, health authorities have a campaign to get commodes into half the household and most public restrooms. This is because squatting can cause wear and tear on the knee joints and even cause degenerative joint disease. However, there is growing interest in the health benefits of using squat toilets. Apart from the fact that it is cleaner since there is no skin contact with the toilet, the squatting posture is noted for its health benefits. Some medical experts say the squat position is healthier as it arranges the intestines in a straighter line and relaxes the muscle that regulates continence, making defecation easier.
Ceramic sinks, washbasins, washbasin pedestals, baths, bidets, water closet pans, flushing ... Importers
2011
2012
2013
quantity, Imported quantity Imported Tons World
No Quantity
South Asian Association for Regional Cooperation (SAARC) Aggregation
No Quantity
No Quantity
No Quantity
Mixed
38,276
53,280
23,846
2015
Imported quantity, Imported quantity, Imported quantity, Tons Tons Tons
Unit
No Quantity
2014
No Quantity
Unit No Quantity
Mixed
Maldives
1,349
1,125
Tons
1,067
1,212
58,256
Units
India
14,429
21,002
Tons
27,540
40,253
38,036
Tons
Sri Lanka
3,033
3,313
Tons
3,577
3,722
4,077
Tons
Bangladesh
1,761
No Quantity
No Quantity
1,828
3,040
3,264
Tons
Nepal
1,754
2,722
Tons
2,615
3,082
2,398
Tons
Pakistan
1,356
302,255
Units
1,607
1,959
2,312
Tons
164
278
Tons
42
12
95
Tons
Bhutan
Sources: ITC calculations based on UN COMTRADE statistics. The world aggregation represents the sum of reporting and non reporting countries The quantities shown in dark green are estimated by ITC. The quantities shown in light green are estimated by UNSD.
Ceramic sinks, washbasins, washbasin pedestals, baths, bidets, water closet pans, flushing ... Exporters
World
2011
2012
2013
2014
2015
Exported quantity Tons
Exported quantity, Tons
Unit
Exported quantity, Tons
Exported quantity, Tons
Imported quantity, Tons
No Quantity
No Quantity
No Quantity
No Quantity
No Quantity
No Quantity
Mixed
137,305
121,717
South Asian Association for Regional Cooperation (SAARC) Aggre-gation
93,085
India
90,615
118,224
Tons
134,261
119,524
119,744
Pakistan
2,415
560,625
Units
3,036
2,157
1,458
Sri Lanka
55
28
Tons
8
30
40
Nepal
0
0
0
4
0
Bangladesh
0
77
0
2
No Quantity
Tons
Sources: ITC calculations based on UN COMTRADE statistics. The world aggregation represents the sum of reporting and non reporting countries The quantities shown in dark green are estimated by ITC. The quantities shown in light green are estimated by UNSD.
40
asian ceramics
AC 17-1
www.asianceramics.com
www. AMR4 u.com
Superwhite KAOLIN for TABLEWARE & TILE
SPECIALIZED replacements for BONE ASH
Makingg a Material Difference 369, Conic Investment Building 13 Hok Yuen Street, Hung Hom Kowloon, Hong Kong Tel: (852) 23637813 • (852) 23637823 Fax: (852) 23637826 Email: enquiries@AMR4u.com
AMR
Analysis: China
Tile tales competition rises as Provinces fight for survival
AC looks into the relative strengths of China’s major tile producing provinces, as they come under increasing domestic pressure and international attack.
W
ith a production capacity of over 12 billion sq.metres of tiles, China is of course the biggest driving force of world growth in ceramics production. In fact, the major production bases in China attributed much of this record. However, pressures, both commercial, regional and environmental, continue to put an increasing strain on the country’s manufacturers, and raise the level of competition between each province.
Guangdong Production Base
220-230 ceramic enterprises - 1,055 – 1,070 production lines Strengths Problems • High industry concentration • Stagnant locally • Strong brand power • Slow uptake from industry • Wide market reach market upgrades • Talented worker pool
Hunan production base
50-55 production lines - 16-18 ceramic enterprises Strengths Problems • Less competition because of • Enterprises scattered and little low no. of companies economy of scale • Very low product prices • Low brand recognition • Serious overcapacity given market size
Henan production base
85-88 ceramic enterprises - 112-120 production lines About 20 counties have ceramic enterprises Problems Strengths • Less industrial concentration • High production capacity • Low prices meaning logistics more difficult • Low product added-value • Rich human resource • Strong competitiveness in key • Large production volume but sales district for 500 km round small profit and small market • Lack of management talents and senior technical workers
42
asian ceramics
AC 17-1
Fujian production base
250-255 ceramic enterprises - 525-535 production lines Strengths Problems • Rich raw materials & resources • High production cost • Strong sales force • Has now lost competitiveness in middle and low-end market • Developed logistics • Less established enterprises with supporting services
Jiangxi production base
140-150 ceramic enterprises - 335-350 production lines Problems Strengths • Lack of management and R&D • Centralised industry • Excellent freight rail links talent • Good road links and logistics • Difficulty in expanding sales area • Total work force in excess of 100,000 • Limited space for brand growth locally • Strong competitiveness of middle and low-end market in central china and southwest area
Sichuan production base
250-260 production lines - Production capacity of 3 million sq.m/per day Strengths Problems • Industrial clusters • Common problems existing in • Wide selection of products capital supply chain • Low Prices • Financing difficulty • Heavy salary issues related to poor cashflow • Lack of white body raw material
Zibo production base
104-110 ceramic enterprises - About 200 production lines Strengths Problems • Plenty of OEM factories • Lack of local design creativeness • High industrial concentration • Excessive reliance on OEM • Good information networking factories • Rapid progress in implementing product upgrades • Limited distribution channels
www.asianceramics.com
Analysis: China
Export of unglazed ceramic tiles for October 2016 Country/ region
• Convenient logistics • Low overall costs • High return based on investment • Short and small production line • Flexible operation • Optional production (batch considered)
Linyi production base About 150 production lines Strengths • Great production capacity of interior wall tile • Good logistics
Problems • High pressure from environmental protection • Heavily involved in pricing battles • Difficulty in lowering stock levels
Gaoyi production base
24-26 ceramic enterprises - Around 32 production lines Production capacity is about 270 million sq.m occupying almost 50% production capacity in Hebei Strengths Problems • Strong Government support • No recognized brands • Less high added-value locally products
Faku production base
40 ceramic enterprises - 242 production lines Strengths Problems • Rich raw material availavi • Single product structure & low added-value • Market coverage in northeast area • Few self-owned brands • With the advantage of china • Not completed of industry border trade market chain • Low labor cost • Serious situation of low level copying product • Low cultural quality of employees
Revenue projections
In the ten months of 2016, the total turnover for 1,777 scaled (i.e. of accepta-ble quality and producing continuously on an annual basis), increased by 3.0% with sales profit increased by 0.1%. Overall, this was catered for by an increase of 1.6% in ceramic tile output to 9,065m. sq metres. The export vol-ume, however, declined by 7.6% to 867m. sq metres whilst the overall export value plummeted by 27.4% to US$4,600m. This was coupled with a collapse in the export price also from an average of US$7.31/sq metre in 2015 to just US$5.31 in 2016. By way of comparison, the output of ceramic sanitarywares was 165m.pcs, decreasing by 2.7% over the same period. Export volume of ceramic sanitarywares was 59.70m.pcs, decreasing by 8.5% Export value of ceramic sanitarywares was USD 2.31b., decreasing by 34.4%, and the average export price of ceramic sanitarywares was USD 38.69/pcs, decreasing sharply compared with USD 56.36/pcs for 2015.
www.asianceramics.com
Volume
Value
Kg
Growth rate (%)
US$
Growth rate (%)
Indonesia
59,057,557
-8.7
10,864,349
-20.0
Thailand
42,649,706
-26.1
8,058,367
-31.6
Philippines
42,479,804
25.4
8,383,988
6.5
Saudi Arabia
27,484,151
-29.3
9,728,384
9.1
South Africa
22,212,264
66.5
3,883,433
30.5
Malaysia
18,279,445
6.3
5,117,110
-62.7
South Korea
15,046,017
2.8
4,936,515
-0.4
Columbia
14,910,028
68.4
2,523,094
43.7
Pakistan
12,803,779
12.4
2,605,489
-10.7
Vietnam
12,578,206
-1.2
2,957,184
-41.3
Sri Lanka
12,415,666
29.1
2,390,845
18.4
Cambodia
12,080,239
-24.7
2,164,933
-28.8
Peru
10,900,177
-30.9
2,098,073
-41.0
UAE
8,782,039
-32.3
2,504,903
-60.5
Bangladesh
8,700,338
-21.7
2,296,958
-19.1
Japan
7,884,155
2.3
3,587,386
15.0
Singapore
7,878,681
3.2
9,544,467
-19.2
Israel
6,985,820
-14.5
1,557,366
-15.4
USA
6,524,951
-27.0
3,385,636
-70.8
Australia
6,398,253
-13.5
3,167,996
-20.4
Tanzania
4,949,724
35.5
1,349,823
-9.7
Chile
4,875,719
-8.4
985,898
-22.7
India
4,609,912
-91.4
1,898,138
-87.9
Iran
3,893,067
55.3
822,424
16.2
Dominica Rep.
3,823,283
-21.8
717,237
-45.8
Canada
3,651,485
-15.5
2,335,172
75.9
Ghana
3,608,744
-44.3
953,302
-84.2
Nigeria
3,478,666
-81.7
974,036
-77.2
Kenya
3,378,669
6.6
929,512
11.9
Aman
3,274,727
37.6
772,161
64.5
Costa Rica
3,150,154
71.0
584,931
58.6
Ecuador
3,058,849
-35.3
533,995
-47.0
UK
3,009,063
26.2
756,472
?
AC 17-1
asian ceramics
43
Analysis: China
Import of unglazed ceramic tiles for October 2016
Export of glazed ceramic tiles for October 2016 Country/ region
Volume
Country/ region
Value
Kg
Growth rate (%)
US$
Growth rate (%)
South Korea
71,986,443
15.6
16,918,274
17.8
USA
65,755,989
-5.5
22,768,392
-24.8
Philippines
41,281,205
-7.5
10,652,993
Volume
Value
Kg
Growth rate (%)
US$
Growth rate (%)
Italy
462,164
61.9
528,481
-0.7
Germany
271,441
498.9
188,736
362.2
-62.1
Spain
72,278
116.5
23,784
-83.1
7,300
0.0
45,791
0.0
Australia
35,662,737
1.0
11,063,905
-12.4
South Korea
Ghana
27,310,516
-18.7
8,756,912
17.9
France
5,426
60,188.9
27,467
119,321.7
Cambodia
24,109,772
34.9
6,213,140
-24.2
China
2,056
1,935.6
1,242
3.0
North Korea
24,029,821
76.9
6,467,207
10.8
Japan
1,628
-40.9
3,362
-49.0
Vietnam
23,712,740
-18.0
14,425,173
-85.0
Taiwan
814
0.0
918
0.0
Israel
22,293,126
13.5
4,842,609
-25.5
Thailand
360
0.0
35
0.0
UAE
21,413,229
-22.3
6,791,279
-57.3
Portugal
145
0.0
434
0.0
Pakistan
20,056,741
-13.0
4,569,856
-52.7
UK
31
210.0
11,907
?
Kenya
17,711,556
4.5
4,163,307
-24.3
Canada
17,288,626
23.2
5,449,783
7.3
South Africa
16,721,650
-10.5
4,544,048
-35.6
Tanzania
15,636,511
6.2
3,306,072
-26.3
Malaysia
15,287,353
54.8
5,398,863
5.1
Senegal
15,035,302
45.9
5,004,275
Saudi Arabia
14,366,765
-29.9
Chile
13,576,666
Singapore
Import of glazed ceramic tiles for October 2016 Country/ region
Volume
Value
Kg
Growth rate (%)
US$
Growth rate (%)
Italy
2,023,278
-33.6
2,042,671
-33.0
-28.4
Spain
1,866,214
-1.8
1,324,223
-10.5
7,006,818
-42.9
Malaysia
208,949
711.7
79,594
627.6
-10.8
2,933,886
-24.9
Portugal
58,374
152.1
39,414
163.1
13,138,536
8.5
21,023,904
100.2
China
56,925
9.1
16,854
-27.2
Hong Kong
12,173,709
-9.9
11,333,617
24.1
Indonesia
50,689
-31.8
23,062
-35.7
Thailand
12,019,160
9.3
3,981,471
8.4
Taiwan
40,537
1,037.4
30,408
163.0
Myanmar
11,802,357
-24.5
4,020,322
-62.6
UAE
38,515
0.0
54,537
0.0
Indonesia
9,653,450
43.8
3,921,298
31.6
Thailand
1,492
0.0
1,030
0.0
Japan
8,335,861
-14.7
4,309,579
-28.1
South Korea
1,166
0.0
6,406
0.0
Peru
8,176,497
4.0
1,706,802
8.4
Germany
508
-98.7
578
-98.5
Cote d’Ivoire
8,125,864
-47.3
1,339,576
-67.3
Netherlands
232
0.0
672
0.0
Nigeria
7,661,700
-69.7
1,495,848
-86.5
Mexico
229
0.0
2,947
0.0
Cameron
6,867,801
37.2
1,088,515
-9.3
Japan
194
-99.8
1,154
-99.6
India
6,705,716
-8.0
2,396,976
-13.4
Australia
118
-18.1
665
-41.3
Macao
6,428,750
153.6
3,153,939
55.9
Belgium
66
0.0
350
0.0
Columbia
6,088,928
-25.1
1,526,458
?
USA
30
-99.9
554
-99.8
44
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Analysis: Fuel Costs
Fire in the oil and gas markets to hinder or help?
AC looks at how the fluctuating fortunes of the global gas and oil industries, in the face of concerns over energy security and rapidly evolving political landscapes, could have a massive impact on ceramics right across the continent.
G
lobal energy markets are shifting faster than ever, giving developing country governments urgent new choices about how to scale up their power generation efficiently and sustainably. For emerging Asia, none of the changes we have seen over the last decade are more consequential than the emergence of natural gas as an affordable and clean source of electricity. Natural gas is increasingly available across Asia as a result of technological advances that have made it easier to locate, extract and transport across the globe. Fifteen years ago, only 10 countries worldwide were importing natural gas. Today, there are more than 30, with China and Japan among the top global importers. And that number should be closer to 50 by the end of this decade.
Why does this matter?
For Asia, a region that historically had the least access to natural gas and paid the most for it, the scale-up in gas trading has dramatically changed the energy landscape and provided policymakers with an important new choice in how to power their growth. Specifically, gas offers an opportunity to displace coal-fired power, which remains prolific in Asia despite its climate and health effects. Meeting Asia's growing energy needs will require enormous investment. More than half of the five terawatts of new power generation that will be added worldwide by 2030 will be in the region, led by China and India.
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Renewable energy, including solar and wind, is increasingly becoming part of the solution and will be even more so in the coming decade as energy storage technologies advance. But coal also features in the region's near-term energy plans more than 80 per cent of the new coal plants set to start operations globally in the next five years are in just six countries in Asia. In this context, natural gas has an important role to play supporting the scale-up of renewable energy and as a greener alternative to coal-fired power. Well-managed gas emits less than half the carbon of coal, with a fraction of the particulate matter linked to respiratory illnesses already a major preoccupation in China and a growing one in India. Gas is also an excellent complement to solar and wind power, as it can provide flexible backup power at night and on cloudy and still days. All of this makes natural gas an important puzzle piece for leaders across Asia to consider as they decide on the best energy mix to meet their growth needs and align with their climate and air quality concerns. While thermal energy prices can be volatile, we have seen gas prices decline sharply over the past decade and anticipate gas to continue to trade with much lower price volatility than oil and at historically lower premiums to coal in the near term.
The rise of LNG
This should open opportunities for liquefied natural gas (LNG) storage and trading, as well as avenues for new uses of natural gas as a fuel source, including for vehicles.
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Analysis: Fuel Costs
hole Asia is already the primary destination for LNG exports with countries including Bangladesh, the Philippines and Indonesia investing in import infrastructure and gas-to-power installations to meet growing energy generation needs. And at the centre of the action is Singapore, as an emerging hub for LNG trading. The kind of trading infrastructure that Singapore is investing in will have great value as gas continues to grow as a traded commodity, worldwide and especially across Asia. Governments need to balance a number of factors when considering how to meet growing demand for electricity and improved power services. For countries across Asia, the decision matrix for the coming years ought to include natural gas as a transition fuel that can green their energy mix and support a dramatic scale-up in renewable energy once battery storage technology advances further. Energy market watchers have had a dizzying view over the past 10 years - this is not going to change any time soon, particularly as Asian governments set ambitious targets to ramp up electricity generation through the best means possible. The next decade is likely to be marked by even more pronounced changes in fuel prices and technology - making it a great time to look forward and invest.
Future security
The future of the Asia-Pacific’s energy markets rests on achieving better regional cooperation and integration, and new initiatives are kicking off to speed up the transition to a more sustainable energy mix according to many industry observers. The Asia-Pacific region is at a turning point in its energy trajectory.
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The energy solutions that have fuelled growth in the region over the past few decades are no longer compatible with the sustainable development aspirations of our nations and their people. In transitioning to a new era of sustainable energy, policymakers across the region face complex decisions. Supplies must be secure and affordable, and they must fill the energy access gap which leaves half a billion people across the region without access to electricity. At the same time, mitigating the local impacts of energy generation and use will be vital in resolving problems such as the air pollution choking our cities and the global consequences of greenhouse gas emissions causing climate change. Solutions exist, but only through regional cooperation and integration can Asia and the Pacific transition to sustainable energy in time to meet the ambitious 2030 Agenda for Sustainable Development and its goals. Countries have committed to moving towards a more diverse and low-carbon energy mix through the 2030 Agenda and the Paris Agreement on Climate Change. However, fossil fuels stubbornly remain a major part of the regional energy mix, making up threequarters of electricity generation. Unless the region’s countries work together to accelerate the incorporation of sustainable energy into their strategies, business-as-usual approaches will result in a continuation of fossil fuel use and its associated impacts. While some countries suffer from energy shortages which limit their economic and social development, others enjoy energy surpluses, such as hydropower and natural gas. Trading these resources through new cross-border power grids, drawing on renewable energy when possible, as well as gas pipeline infrastructures, can open up enormous opportunities for both economic growth and decarbonisation. The energy technology renaissance already underway in some countries is playing a vital role in the transition. New technologies are reducing the cost of clean energy and renewable power. Smart grids and electric vehicles are rapidly gaining market share. Since 2010, the cost of solar power generation has declined by 58 per cent, with the cost of wind power down by one-third. The International Renewable Energy Agency projects cost reductions of 59 per cent in solar power and 12 per cent in wind power within 10 years, edging below fossil fuel electricity costs in most AsiaPacific countries. Advances in long-distance power transmission technologies enable the linking of renewable energy resource-rich areas such
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Analysis: Fuel Costs
as the Gobi Desert, Central Asia and far eastern Russia, with distant population centres. The Asia-Pacific has emerged as an engine room for clean energy, both as a manufacturing centre for renewable energy technologies and as the leading region for their deployment, with $160 billion invested in renewables in 2015. On the demand side, energy efficiency technologies have an important role to play in the energy transition. Better energy efficiency is a key driver in decoupling energy use and GDP growth in many economies. With 15 per cent of the world’s electricity consumed by lighting, efficient LED lighting technology, which consumes up to 85 per cent less energy, will make substantial savings. Energy storage technologies for vehicles and power applications have also leapt ahead, offering flexibility in power usage and balancing variable electricity generation from renewables. Here again, regional cooperation, technology transfer and south-south collaboration will play a vital role in the transition. Despite these encouraging developments, the success of the energy transition will require sustained commitment at national and regional levels through better policies, incentives and allocation of investments. The inertia of the existing energy sector is considerable with its long-lived assets and entrenched institutional arrangements. Regional cooperation, through sharing policy experiences, building capacity and mobilising finance can play a significant role in assisting countries to implement their own energy sector reforms and capture the many co-benefits.
Regional co-operation
The importance of regional energy cooperation is evident in the transboundary nature of many prominent energy challenges – improving regional energy security, managing air pollution and establishing cross-border energy infrastructure. ASEAN, South Asian and Central Asian countries as well as China, Russia and Mongolia are already embracing cross-border energy connectivity. Initiatives such as the CASA 1000 and the ASEAN Power Grid will allow low carbon energy from gas, hydropower, solar or wind to be traded across borders. Long-term regional dialogue is required to further develop these complex and infrastructure-intensive initiatives. Connecting countries, finding regional solutions and promoting regional standards and guidelines has been at the core of the work of the United Nations Economic and Social Commission for Asia and the Pacific for the past 70 years. We recognise the need for regional energy cooperation and, with the support of our member States, have established an intergovernmental Committee on Energy that will meet for the first time in Bangkok from 17-19 January. Through the Committee, countries will help to map out key regional energy solutions for the region such as accelerating the uptake of renewables and energy efficiency, establishing cross-border energy connectivity, promoting regional approaches to energy security, and providing modern energy access throughout the region to ensure a sustainable energy future for all.
Politics to change market dynamics?
With Trump sworn in, how aggressive will the US become in exporting its energy? Not just oil, but gas too? Already inroads are being made into industrial markets in Northern Asia, and this could have a knockon effect for traditional suppliers, such as Australia with all sorts of ramifications for the ceramic industry. Indeed, in the last couple of months, a surge in shipments of US gas into north Asia highlights the challenge confronting Australia’s gas exporters as more gas projects come on stream over the next few years.
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That threat of cheap US gas cutting across the ambitions of Australian gas exporters was evident during December, when threequarters of the gas exported from the new US gas export project at Sabine Pass was sold into north Asia, according to industry analyst Graeme Bethune. “Until a month ago, it wasn’t sending much to Asia, but it is sending a lot now, although there is no sign of it harming Australian exporters,” he said. Close to $200 billion has been invested on a range of gas export projects in Queensland and northern Australia which have recently been commissioned and are ramping up production. As a result, Mr Bethune’s EnergyQuest estimates that in 2017, Australia will export $36 billion of gas, if the price of oil averages $US55 a barrel in the year ahead. That will be up from $17.9 billion recorded in 2016 when Australia’s gas exports rose to 36.8 million tonnes of gas, which was itself a rise of 8.6 per cent over 2015 volume shipped abroad of 26.7 million tonnes. For 2017, EnergyQuest estimates gas volumes will hit 60 million tonnes. The bulk of Australia’s exports are sold to energy utilities in north Asia, specifically Japan (48 per cent), China (30 per cent) and South Korea. “The big unknown is the oil price,” Mr Bethune said. “Our forecast is $US55 a barrel which is in line with the forward curve. That price coupled with the higher export volumes will double the value of Australia’s gas exports in 2017. But if the oil price declines, then the value of the exports will also decline.” Oil averaging around $U55 a barrel will ensure Queensland’s gas export projects are profitable, in terms of paying down borrowings and generating returns for shareholders he said. US gas exporters are able to source gas for close to the spot price there of around $US3.50 per million British thermal units, which is the standard used to price gas. The US spot price is believed to be significantly less than the price of gas in Australia. The surge in US exports into northern Asia comes as the spot price rose to a two-year high of $US9.75/mmBtu. This is well above the contract price of most Australian shipments into the region of around $US7/mmBtu. Part of the reason for the surge in the spot price coupled with the purchases from the US was due to production problems at the giant Gorgon project off western Australia which forced buyers to scramble to source gas supplies from alternative sellers, Mr Bethune said. “Shipments from the Sabine Pass project on the US Gulf Coast, which were mostly going to South America, are now overwhelmingly heading to north Asia with nine of the 12 December loadings heading there,” Mr Bethune said. “However, this does not appear to be adversely affecting Australian exports, which are well positioned to take advantage of high spot prices.” While the US was shipping into Asia, some Queensland gas has recently been sold into the Mexican market, for example. The year ahead will see Sabine Pass raising output further, with additional US gas export projects also coming on stream which may serve to cap demand and prices, industry analysts have warned. Mr Bethune said the futures price for export gas is signalling declines to closer to $US8/mmBtu in February as the supply squeeze from Gorgon eases and as the run-up in demand eases moving closer to the northern spring. As many as five new export gas projects are planned to come onstream in the US over the next few years. At the same time, the export market will be absorbing output from the Wheatstone project off Western Australia which is to begin shipments mid-year, with output to peak at 15 million tonnes annually from 2018.
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Analysis: Fuel Costs
Pakistan: a case in point
“NOTHING can drive the massive industrial infrastructure without energy” says one of Pakistan’s leading ceramicists on condition of anonymity: “Ending the oil and gas age will bring a total change by collapsing industrial economies. The inherently limited quantity of fossil fuels is going to expire by 2050-2070 and any stupid use of conventional, nuclear, biological, fuel or weather weapons cannot u turn it. Now the world has only choice among plutonium, carbon and the renewable energy sources. According to a recent survey 60% people vote for renewable and only 10% for nuclear energy. International universities and industries are in a state of war on searching new energy resources and redesigning energy efficient machinery. We have neither a visible energy policy nor any focus on relevant science and engineering education. Like many other countries we must develop a national energy policy and prioritize it over many conventional technologies like computer and telecom engineering in most of Pakistani universities. Our education managers are widening similar technologies to increase their income ignoring how to manage energy availability after 40 years. We might have money there would not be energy sellers as none will have it. We need simultaneously applied projects to solve the community problem along with fundamental research. HEC Pakistan replaced archaic UGC in 2002 aiming to develop modern education paradigm like developed countries. HEC offered many MS and PhD scholarships, started foreign faculty hiring program, revised curriculum of universities and regularised postgraduate programmes. Meanwhile in this era, HEC also initiated offices of research innovation and commercialization across country to facilitate and strengthen University Industry linkages. Industries in Pakistan are facing acute problem of technical support in terms of new technology adoption and quality of product at mass production level. Unfortunately, Industry do not trust on academia and prefer to open market for solution of their problems. Fan Industry in Gujrat is decelerating its exports due to non-compliance of IEC and IEEE standards. The industry failed to qualify for European or American markets. Leather industry is injecting harmful chemicals into underground aquifers of fresh water causing a major disturbance to drinking water of Sialkot and surrounding areas. The Ceramic industry of Gujrat and Gujranwala is taking its last breath due to decreased export and use of old fashioned machinery. There are many technical universities and colleges working in rich industrial triangle of Gujrat, Gujranwala and Sialkot. Due to trust deficit of University-Industry linkage, to date no significant step has been taken to solve the industrial problems from academia. It is time for university executives and policy makers to establish an environment of trust and confidence with industry for solution of their problem through paper based assignment to university teachers. For Industry, patience and faith are looked-for sustainable development of strong relation. To implement the idea we need to seek willingness of the local industrialists and explain them need for switching over to modern technology. Author has written a proposal of establishment of Fan Testing Laboratory with linkage of local fan industry and Govt of Punjab. The proposed lab will test and issue performance based certification under guidelines developed by Enercon with Pakistan and provide international Certifications in compliance with IEC and IEEE standards. “Economy of country is function of energy demand, research productivity, number of patents and entrepreneurship etc, Faculty at most universities is not confident of providing the technical
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consultation, they have high teaching loads for undergraduates. We need more pilot plants at universities (applied nature project) and at training centres for post-graduates. Policy-makers should provide resources, for effective linkage with outcome based targets and focusing on the regional development of technologies along with HR training. CPEC is great opportunity and 100s industrial sectors can be developed on the basis of raw material available along the route” he concludes.
India: fuel security a requisite
India is expected to grow over 7% percent in the coming decade. To fuel projected economic growth and cater growing energy needs, India requires a lot of energy. With an area of 1.26 million square miles with diverse landscape and difficult terrain, India comprises around 1.2 billion people and their ever increasing needs. Currently India imports 70-80% of its oil and 30-40% of its natural gas requirements. Historically India’s energy import dependency rests on Middle East. Coal is the most important and widely available fossil fuel in India. It supplies 55 percent of the country’s primary energy needs. According to BP Statistical Review, 2016 at the end of 2015, India had 60600 million tons of coal reserves with a global share of 6.8% and R/P ratio of 89 years. Compared to other fossil resources like oil & gas, India is better placed with coal resources for future production and use. India intends to reduce coal imports by exploiting its own reserves. Import of coal has already decreased, by around 19 percent to 16.38 million tons in the month of May 2016 as compared to around 20.29 million tons in May 2015. India’s current renewable energy capacity, 45 GW, is just about 14.7% of total installed grid connected electricity generation capacity of 306 GW in the country. Some of the major challenges faced by renewable sector are lower capacity utilization, lack of evacuation infrastructure, and funding for large scale expansions. Coal still the cheapest source for power production with per unit tariff in the range of Rs. 2.3-4.00. However, renewable sources like wind and solar are competing well to achieve grid parity. Current wind tariff is in the range of Rs. 3.39-Rs.5.92/kWh and recently solar tariff reached as low as Rs.4.34/kWh. In the beginning Government encouraged feed-in tariff but now the market is moving towards competitive bidding tariff. Therefore, renewable tariff is moving closer to grid parity. Despite all kind of limitations the Government targets to achieve renewable installation capacity of 175 GW by 2022. Further, multiple initiatives are being taken by the Government to promote off-grid or captive renewable energy along with decentralized renewable applications. The Government is actively pushing installation and production of renewable energy through schemes like accelerated depreciation, generation based incentives (GBI), and viability gap funding. The Government already funded Rs. 25075 million under the GBI scheme for solar and wind power production.
Renewables?
Decentralized renewable applications are expected improve livelihood of millions of Indians in the rural as well as urban India. Because holds will have access to energy which would be helpful for enhancing scope of economic activity, thereby improve economic productivity and revenue generation. Further, affordable energy accessible to all citizens could improve situation of primary education in the country. As India needs to diversify its energy mix and reduce dependence on imported fossil fuel nuclear energy could play a very important role in ensuring energy security of the country. Application of nuclear for
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electricity generation needs to be actively pushed forward. Media reports suggest that nuclear power cost is in the range of Rs.9-12/kWh. India’s largely indigenous nuclear power program resulted in capacity installation of 5780 MWe. With the support of Russia and many other partnering countries India is expected to achieve 14.6 GWe nuclear capacity by 2024. It is high time for India to intensify strategic measures to address its energy security challenges like: making energy accessible, affordable, and available to all its citizens. At least, India could aim to manage energy supply security if not complete energy security. One of the important source of energy could be natural gas as a transit fuel for meeting emerging energy needs. Natural gas can gradually reduce: (i) use of diesel and petrol in the transport sector, (ii) use of coal in the power sector, (iii) use of liquefied petroleum gas (LPG) in the domestic cooking, heating, and cooling; and (iv) use of coal and liquid fossil fuel in various industries like ceramic, textile, steel, etc. Further, natural gas could be used to produce hydrogen used in the refineries and in the transport sector. India’s domestic natural gas production remains a big concern and future addition of new gas reserves provide no better comfort. As a result India’s import dependency continue to grow and we believe that the import trend may very much continue in future too. Unless domestic unconventional sources of gas offer some surprise, import of liquefied natural gas (LNG) would continue to play a critical to bridge the demand-supply gap.
Middle East dependence
For the time being India’s over dependence on Middle-East for fossil energy is not a concern from supply point of view. However, India should expand its energy sources basket carefully and strategically to avoid any future supply constraints. Considering the current supply glut of fossil fuel, this is the right time to expand the range of sourcing destinations. In the recent past, India actively searched for alternative or complementary destinations for sourcing natural gas. In the process, emerging destinations like the US and Australia were added. India’s domestic gas production fallen from about 51 billion cubic meter (BCM) in 2010-11 to 31 BCM in 2015-16. As a result the gap between demand and supply has been widening. As results natural import dependency has been increasing which is evident from increase in LNG import from 12.9 BCM in 2010-11 to 21.3 BCM in 2015-16. Natural gas is certainly tipped as the transition green fuel especially in the transport in sector. It has comparatively lower carbon footprintthus more environment friendly compared to coal and oil. The uses of gas in cooking, heating and power generation stand to benefit millions of stakeholders. Apart from the above purposes use of natural gas for mobility sector addresses many concerns including the environmental concerns faced by urban cities. So, city gas distribution is poised to offer green energy solution to many struggling cities and upcoming smart cities.
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In the present scenario India imports gas only through LNG carrier. It is believed that transporting natural gas through pipelines is found be cost effective over LNG carriers. For example, in 2013 China received pipeline gas imports at an average price of US$ 9.78 per MMBtu compared to average price of LNG import price of US$ 13.8 per MMBtu. LNG is costlier because the gas has to be liquefied to reduce its volume and transported using specially designed cryogenic tanks. Also at the receiving end specialised LNG terminals have to be built to store and re-gasify. Essentially the countries which import natural gas through pipelines enjoy cost advantage over import of LNG. India has been pushing for transnational pipelines with limited success. However looking at India’s strategic location it would be viable for India to take gas from gas rich Iran, and Turkmenistan through pipelines. India already has agreed upon much talked about Turkmenistan--Afghanistan-Pakistan-India (TAPI) pipeline which starts from Turkmenistan and passes through Afghanistan & Pakistan before reaching India. TAPI pipeline with a length of 1124.68 miles passes through terror affected areas of Kandahar and Herat. Thus this makes it a very risky project to operationalize. Although NATO forces stationed in Afghanistan would ensure to protect the part of the pipeline passing through terror prone territories but future sabotage and attack may not completed ruled out. The project is due to be completed by 2019 and India would receive 1341.78 million cubic feet per day of gas. Operationalization of TAPI would certainly improve gas supply security for India. Another transnational pipeline project namely Iran-Pakistan-India couldn’t happen due to very many reasons including sanctions on Iran, geopolitical pressure, and security concerns. In a report published in the Indian Express on 22nd April 2016 the Iranian Ambassador was stated saying that this project should be forgotten.
From Iran to Gujarat…
Discussions with Iran is on for a deep sea 868 miles pipeline via the Oman Sea and Indian Ocean. Iran-Oman-India pipeline from Iranian port of Chabahar to India’s Gujarat Coast would transport 1098.141 million standard cubic feet of gas per day. This might compensate for the almost failed IPI project and also there would be no issue of any other transit country conflict. India has also invested for the development of the Chabahar port and also funding a rail link between Chabahar and Zahedan in Iran. The completion of the rail link would connect Chabahar to North South Transport Corridor (NSTC). These investments are moulding the bilateral ties of India and Iran. This deep sea pipeline will not only connect India to Iran’s Gas fields but Oman is also slated to join the pipeline at a later stage. This would give India a strong foothold to the Gas trade in both Iran and Oman. Also it would boost India’s stand in comparison to China’s One Belt One Road Program (OBOR). Besides Iran, Oman and Turkmenistan, India also has a potential import source towards its north-eastern side which is Myanmar. The
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Analysis: Fuel Costs
main advantage with Myanmar is its proximity to India and that it shares its borders with North-eastern part of India. Myanmar large untapped reserves. According to BP statistical review report 2016 Myanmar has 18.7 trillion cubic feet of natural gas with an R/P ratio of 27 years. But until now the investments that India has made in Myanmar although substantial are very less in comparison to China. According to a report in Journal Of Energy Security India’s investment in Myanmar Oil and Gas sector is around US $1.6 billion while Chinese investments is around US$ 8 billion. The 1.04 US$ Sino-Myanmar gas pipeline has been functional since 2013 transporting 423.72 billion cubic feet (bcf) gas to China annually. Lack of proper funding and coordination between public and private owned firms has resulted in India loosing important bids to other countries. Therefore, impacting India’s intention to secure long term energy supply. Further, India failed to bring to table Myanmar-Bangladesh-India transnational pipeline because of Bangladesh’s unwillingness to act as a transit country. Although an alternative to this route was by bypassing Bangladesh and building a pipeline through NorthEast India that could connect to pipelines of East India. This deal also never came to reality due to multiple reasons including lack of funding. And thus China took advantage of this situation and entered into the gas pipeline market of Myanmar and built a similar transnational pipeline to China’s comparatively less developed Yunnan province. However, an agreement with Myanmar through North-eastern states may increase the pipeline costs but it would also give India long term gas sourcing from Myanmar. The problems that India faces on its north-western part because of hostile relationships with Pakistan and with issues of pipeline security in both Pakistan and Afghanistan. This however is not the case with Myanmar. Therefore having a gas trade relationship with Myanmar is much secure and mutually beneficial. In-case any problem occurs in the north-western side this may act as a contingency plan. This also has another benefit; the gas pipeline from Myanmar via North-East India can be used to develop the region which otherwise due to its difficult terrain is not easy to develop. Development of North-East provides a major strategic advantage to India in dealing with China in terms of monitoring and also preparing required infrastructure to handle any unforeseen situation. To ensure long-term energy security for its all citizens India should continue to actively pursue multi-pronged strategies. Currently, the Government is focussing on exploiting domestic fossils fuel and renewable energy resources to address ever increasing demand. Simultaneous, New Delhi’s energy diplomacy with energy resource rich countries like the US, Russia, Qatar, Saudi Arabia, Iran, and Australia has been unfolding. Even Prime Minister Mr. Modi’s look Africa energy policy adds new dimensions to India’s interest in securing energy equity in Africa and enhancing India’s energy security. Further, clean coal technologies are being pushed to improve supply of much greener energy. So in order to secure India’s energy future it is necessary for India to explore and exploit domestic fossil resources but seriously acquire fossil resources outside India. To improve energy supply security emphasis should be given to energy diplomacy, international collaborations, and efficient trade partnership. Building necessary energy infrastructure like LNG terminal and pipeline should be pursued with utmost priority. India should take advantage of global supply glut to improve accessibility, affordability, and availability of energy for its citizens. Further, creating investment climate for renewable energy should be facilitated at all levels to bring renewable energy revolution at the earliest.
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Decontrol of petroleum product pricing especially petrol and diesel prices takes energy pricing toward market determined pricing. Even gas pricing is more market oriented than ever before. Direct cash transfer on use liquefied petroleum gas (LPG) for domestic cooking purpose is a step forward to address energy accessibility and affordability. Judiciary and environment regulatory authorities are seriously pushing use of natural gas or green fuels to improve air quality in metro cities. Within a decade the Government intends to increase city gas distribution to 200 geographical areas from current level of 70 geographical areas. India is certainly capable of addressing existing and future challenges to improve its energy security in the long-run. Moreover, green and renewable energy would play an important role to improve future energy security in the country.
Oil price uncertainty
Global oil prices will witness "much more volatility" in 2017 even though markets may rebalance in the first half of the year if output cuts pledged by producers are implemented, the head of the International Energy Agency (IEA) said on Sunday. The Organization of the Petroleum Exporting Countries (OPEC) agreed on Nov. 30 to cut output by 1.2 million bpd to 32.5 million bpd for the first six months of 2017, in addition to 558,000 bpd of cuts agreed by independent producers such as Russia, Oman and Mexico. "I would expect that we will see a rebalancing of the markets within the first half of this year," said Fatih Birol, executive director of IEA, the Paris-based global energy watchdog. "But what I want to say (is) that we are entering a period of much more volatility in the market ... the name of the game is volatility," he told Reuters Television in Abu Dhabi. Prices fell on Friday and ended the week 3 percent lower on lingering doubts over the extent of OPEC cuts, with sentiment worsened by concerns over the economic health of the world's second-largest oil consumer, China, after it reported the steepest falls in overall exports since 2009. [O/R] Birol said although the OPEC agreement could signal higher oil prices, it would also encourage more production from the United States and elsewhere. Higher prices could also weaken global demand for oil, he added. "I expect the US shale oil will go back to increasing production this year," Birol said. He added that a recent trend of declining Chinese oil production due to low prices could be reversed if the market strengthened. Data from the US Energy Information Administration showed crude production rose notably last week, particularly in 48 southern states. Overall production was 8.95 million barrels per day (bpd) last week, the most since April of last year. EIA/S OPEC and the independent producers are cutting supplies to remove a global glut and prop up prices, which at around $56 a barrel are half their level of mid-2014, hurting the revenue of exporting nations. Birol said his main concern now was lack of investment in new oil supplies after low prices over the past two years forced the shutdown of many projects across the world. "This year, if there are no major investments coming we may well see in a few years from now significant supply-demand gap with serious implications on the market."
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Talking Shop
Talking Shop The great divide Could Brexit jitters threaten recovery? Rob Flello, Labour MP for Stoke-on-Trent South in the UK, describes in the Huffington Post how the government must protect the resurgent ceramic industry post-Brexit “At the end of last year, I was pleased to be able to ask the Prime Minister to honour her predecessor’s commitment that the needs of the UK’s ceramic manufacturers will be catered for as part of the Brexit negotiation process. “This was a chance for Theresa May to recognise the importance of this essential and high-value sector, and set out the measures her government will take to ensure that recent successes are not short-lived. Sadly, her woefully inadequate response only demonstrated how poor her understanding is of the business needs of UK manufacturers. “Being a Stoke-on-Trent MP it is perhaps no surprise that I have an avid interest in the future of the ceramics industry. The city is, after all, otherwise known as the Potteries and at one time over 100,000 people in the area worked in the industry. While it is true that the workforce is much smaller nowadays, the industry is not dead - despite popular misconceptions - and in recent years our potters have gone through a modest renaissance. “The ceramics industry suffers other misconceptions. “It sometimes has the image of a humble craft industry but in reality many manufacturers use high-tech and innovative production processes. Ceramics is a foundation industry, producing clay building products for construction and high temperature refractories for other vital industries. “The preconception of ceramics as plates, cups and teapots prevails, but there are in fact as diverse a range of applications as you can imagine - from artificial hips to body armour. This is Britain at its innovative best, producing high value products that must be part of our economy after Brexit. “This is not to underplay the importance of more recognisable parts of the ceramic industry, however. British potteries include some of the UK’s most recognisable brands, and the ‘Made in England’ back stamp is synonymous with quality around the world. Since 2013, employment in the tableware and giftware sector has increased by 20%, and since 2011 employment in the floor and wall-tiles sub-sector by nearly 40%. Half of the industry’s exports have been sold in Europe, and in tableware there has been a boom of export sales to South Korea off the back of an EU-negotiated free trade deal. “This upturn in performance has also coincided with the European Union enacting special duties to deal with the protectionist dumping of Chinese tiles and tableware in the European market place below the cost of production. When I asked my question to the Prime Minister about trade defence
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after Brexit, she conveniently failed to respond to this particular point, and this is no surprise. “Despite the prevarication over Hinckley Point, Ms May’s Government has done nothing to revisit George Osborne’s love affair with China, and the new Chancellor of the Exchequer has even suggested a fast free-trade agreement with the People’s Republic. This is deeply concerning, as such a deal would likely render trade defence measures meaningless and invite further dumping of Chinese ceramics, along with steel and other products where they have over-capacity. Trade defence is not about protectionism, it is about a level playing field for UK manufacturers facing protectionist dumping. After the UK leaves the EU, British manufacturers cannot be left vulnerable. “MPs of all sides have pushed the Prime Minister for regular updates on the Brexit negotiation process, and so far we have been told simply that the Government will not provide a ‘running commentary’ that would weaken their negotiating position. I fear that this is both a nonsense, and the exact opposite of what business wants to hear. The Government are deliberately trying to suggest that receiving such regular updates is a method for MPs to ignore the clear will of the British people expressed in the EU referendum, whereas in reality they are obfuscating and preventing elected representatives from fulfilling their role in holding them to account. When businesses in my constituency ask me how Brexit is likely to impact on their futures, I need to be able to tell them more than “wait and see”. “Which is why I wanted to use my question to give Theresa May the opportunity to put some of these concerns to rest. Ceramics cannot be treated simply as part of the economy as a whole, because it has its own challenges and concerns, not least those around access to Europe as a market and on trade defence. EU membership undoubtedly provides a good business environment for UK ceramic manufacturers; it is therefore not too much for them to ask how, after leaving the EU, their export markets and level playing field on international trade will be maintained. “The ceramic industry is a microcosm of the economy as a whole, each of which face their own unique combination of postBrexit challenges. It should go without saying that uncertainty and vagaries from the Government reduce business confidence that the eventual outcome from negotiations will be anything but negative. I was pleased that Theresa May welcomed the renaissance in the pottery sector, but future success in all areas of industry will require more than blasé platitudes and unconvincing reassurances that everything will work out fine in the end.”
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Talking Shop
Responses…of sorts…
Prime Minister Theresa May says she will ensure pottery manufacturers have 'the best possi-ble access' to trade with Europe, post-Brexit. Mrs May welcomed the 'renaissance' in Stoke-on-Trent's ceramics industry in recent years and insisted her government would work to see this continue once the country is outside the European Union. But industry leaders have called on the Prime Minister to go further and promise continued tar-iff-free trade with the EU and action to tackle Chinese dumping. Mrs May said: “I am very pleased to welcome the renaissance in the ceramics industry that he refers to. His constituency of course has a long-standing history and tradition in ceramics.
“What are we doing? As we go through the negotiations for leaving the European Union we will be ensuring that this country has the best possible access to trade with and operate within that European market. That's what people want and that's what we will do." Dr Laura Cohen, chief executive of the British Ceramic Confederation, said she was dis-appointed with Mrs May's response, explaining that continued access to the European market was not the same as tariff-free trade. “The EU has introduced antidumping duties to ensure more of a level playing field for UK ce-ramics tiles and tableware manufacturers in the face of protectionist Chinese dumping. These companies employ 6,000 people between them plus extra in their UK supply chain.”
BRITISH POTTERIES INCLUDE SOME OF THE UK’S MOST RECOGNISABLE BRANDS
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Insight
MALAYSIA Country Data
2015 Population Labour force Unemployment rate Income per capita
2016 5
4.0 - 4.5
14.6 Export (US$ bn)
175.6
164.6
3.2
3.3-3.5 Import (US$ bn)
147.7
141.42
2.10%
2.5 - 3.5%
8,821 Inflation rate Construction industry growth (%)
Domestic tile market (m. sq metres)
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2015 31.4 GDP growth
14.2
9,291
GDP growth (%)
56
2016 31
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Domestic sanitaryware market (no. pieces)
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Insight Domestic tableware market (no. pieces)
Principal ceramic export trading destinations (%)
Principal ceramic import sources (%)
Ceramic tile trade (m. sq metres)
Ceramic sanitaryware trade (m. pieces)
Ceramic tableware trade (m. pieces)
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The Largest and Major Ceramics Industry Exhibition in the World with 100,000sqm Exhibiting Space !
CERAMICS CHINA @ Unifair 2017 Date: June 1st - 4th, 2017 Venue: Canton Fair Complex, Guangzhou
Hosted by China Ceramic Industrial Association Organized by Unifair Exhibition Service Co., Ltd.
+86 - 20 - 8327 6369 / 8327 6389 overseas@ceramicschina.com.cn
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Hunter and the hunted
That Was The Year That Was. Dear Diary,
for most of us, the world in general in As 2016 came to a close it would be fair to say that so happy to say good bye and good fact it had not been a classic. I can't recall ever being and death. It hardly helped that from misery terror, riddance to a year that seemed filled with reasonably well. The problem was that a personal and business point of view things went that it felt that hardly a day went by ses there was so many shocks and unwelcome surpri tainty. uncer without some bad news or to the coming year. As I begin 2017 But I've also never felt such trepidation with regard in 2016 will continue for the next 12 ned happe that things I'm conscious that many of the will likely get far worse before they get months (at least) and the uncertainty and changes New Year Resolutions are so simple as my I if even better. I can't say it's a pleasant feeling things I can't change or even influence. to try to be more optimistic and not to worry about ationally and locally that happened in intern that So looking back there are several things my in 2017. 2016 which will no doubt effect business and the econo of course the shambles of Brexit. It The most obvious from a UK and EU perspective is to what the exit from the EU will look is a shambles because there is clearly no plan as tainty is never good for the financial Uncer like for the UK and thus for the EU as a whole. than debate over whether it will be more little is there far so markets and the economy and , futures are at stake. The British game a hard Brexit or a soft Brexit. This isn't some BDSM s Brexit' and 'Red, White & Blue Mean t 'Brexi ns; versio two d Prime Minister has so far offere m will be how Britain exits and proble The Brexit'. Complete nonsense and no use to anyone. the EU will grant it. This will nship relatio what and what relationship with the EU it will have, on the future of British industry. In the have a great impact on duty and trade and therefore safety and take the path of least with side will ss absence of any plan international busine UK especially if the Brexit plan the of out move will ss busine is tion resistance. My predic ses made to 'Leavers' will be promi the of (whatever it is) is further delayed. Certainly none ation. gener a last could delivered and the uncertainty “look at me, me me!” of the Presidential Election process In America the tortuous and self indulgent snore fest ssman who set himself up as an outsider, was livened up by a self proclaimed genius busine perceive as elitist and corrupt. Donald people that nt a change from the political establishme a huge PR campaign for his reality Trumps campaign seemed to start off as a joke, then (like we really need that). Nothing nce prese TV show and interests in enlarging his media had and has no regard for the truth. But and no one escaped his vilification and insults. He obvious the Democratic nominee would e enough American voters bought it. When it becam would be inaugurating the USA's we now by that ed assum be Hilary Clinton it was still But as with Brexit the experts & in. first female President. It was supposed to be a shoe news and vitriol won the day. fake where media social commentators were not watching what his policies will be, quite Quite Somewhat of a shock but not a surprise – Trump won. er and he certainly looks to outsid an is nly certai He . what he will do or say – no one knows bring him could which be continuing his volatile and populist campaign style can Ameri bring to wants he states into all sort of conflicts internationally. He rcing which outsou for ng anythi if – mean will that what see jobs back – we shall China. would surely effect Asia and his favourite enemy –
*The views expressed in this piece reflect those of the author, and not of the magazine or its staff
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ASEAN’s only dedicated ceramic event that brings the region ceramic manufacturers and international suppliers of raw materials, equipment and machineries, to the top ceramic producing country in ASEAN and one of the largest ceramic consumer in the world - Indonesia.
ASEAN’S DEDICATED CERAMIC EVENT
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Hunter and the hunted
happens when a very sizable The US Presidential vote as with Brexit show what al parties and institutions have at politic onal traditi that feel they minority will vote for when shod over them; for each was rough ran best ignored them and at worst ridiculed them and s and outcomes. Maybe policie of ht thoug l logica about was as much about protesting as it banks and more and s ration corpo its time for the traditional parties to think less about about people. ationally significant at least nationally Within Asia there were local shocks, if not so intern announced it would effectively ban ber Novem in t staggering. When the Indian governmen (86% of the cash notes in circulation) the existing Rupee 500 & 1000 denomination notes evasion and corruption most were tax y, in an attempt to purify the system of black mone hard cash and many of the poor have in are ctions transa of 90% aghast. In a country where was chaos. Still the banks are not nt no banking facilities the fall out from the announceme are not yet adjusted for the new ATMs even and full in new for able to exchange old notes y and have clear transactions mone notes. For business people having to 'clean' their black instance in Morbi I was told For rarily. tempo least at closed has meant many factories have netization as a painful demo see such at least 40% and possibly more hibernating. Some the very rich can employ if even long last to likely are necessity but the effects on business . No doubt we will talk behalf on their people to take daily limits of black cash to the banks more about this later in the year. hit from the charming Philippine In South East Asia the stability of the region took a surprising number of Filipinos given a by President Rodrigo Duterte. Duterte is supported rages vigilantes and calls POTUS encou rape, about jokes hes admitted to murder, made population will react when for too a a son of a whore. But again this indicates to me how pines is horrendous and corruption Philip the in ty Pover er. long they see the rich only prosp pronouncements that he will cut his but appalling. How Duterte acts nationally is one thing and Russia will lead to increased PRC the with s buddie ties with the USA and become good has been building military bases in instability in the South China sea. Especially as China asserts its independence implicitly rightly quite ly those contested seas and as Taiwan possib again could be way too interesting for if not yet explicitly from the 'One China' policy. This business? That will rather depend on al region safety in 2017. How will these things effect Chinese belligerence. how the countries in the reason choose to deal with Syria or the wars still ongoing in the I haven't even mentioned the terrible misery of instabilities do little to encourage g ongoin the but lia Soma Afghanistan, Iraq, Darfur or sm for the ceramic economy in 2017. business development so I struggle to find great optimi survived and grown for hundreds has and le durab not if g But the ceramic world is nothin markets of Europe and the USA may of years. Whilst business in the so called traditional s in many countries in our region so classe middle g well struggle in 2017 there are growin than from without. There is also rumour the best opportunities may come from within rather nt of some of the big companies so geme mana of various changes in the ownership and just Chinese companies taking the leads again we might see more regional activity and not tions in the region more interesting exhibi make in expansion and export growth. This could hope. but can we – than previous years too will look forward to the New Year and I So, not withstanding the trepidation I mentioned I s. travel my hope to see many of you on Until next time, Your humble servant, William Hunter
*The views expressed in this piece reflect those of the author, and not of the magazine or its staff
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EXHIBITION PREVIEW
EXHIBITION PREVIEW
EXHIBITION PREVIEW
The 29th CeramBath Calls for Your Attendance
The biannual China International Ceramics & Bathroom Fair, Foshan (CeramBath) will enter its 29th session in April, 2017. Reputation
Initiated from 2002, CeramBath is regarded as----the most prestigious and influential ceramic and bathroom exhibition in China; the most professional exhibition of the sector in China; China home court of world ceramics & bathroom industry.
Venues
China Ceramics City----Chinese Brand Venue China Ceramics Industry Headquarters ----International Brand Venue, gathering famous brands from abroad Foshan International Conference & Exhibition Center---orientated to boost the development of new brands. With various orientations, three venues rely on and coexist with each other, constructing an important platform for ceramic & bathroom enterprises to exploit the market and upgrade brand value. Free shuttle bus will be provided between three venues to facilitate visitors’ trip.
Historical Data
The 28th CeramBath attracted 48526 visitors, 10.6% of which came from outside China. 45% visitors--- 3 times or above, indicating that CeramBath is a reliable platform to choose suppliers and products with high cost performance. 36% visitors ---new visitors expressed that they are surprised to find many new design and satisfying suppliers in the fair. 95%visitors---- choose to continue to attend the next session in April, 2017.
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Event Agenda
Communicative events---- Industrial Area Conference, New Product Release, Gold Member Salon for both exhibitors and visitors to get to know the latest industrial trends. As a professional fair, CeramBath offers communication opportunity for industry manufacturers, distributors and wholesalers to develop and maintain long-term relations with relevant stakeholders. CeramBath sincerely welcomes your arrival!
The 29thChina International Ceramic & Bathroom Fair, Foshan Date: Apr. 18-21, 2017 Organizer: Foshan China Ceramics City Group Co., Ltd. Exhibitors: Around 750 Exhibition Area: 370000 m2
Exhibits:
1. Building Ceramic (wall & floor tile, mosaic, plaza tile, roof tile etc.) 2. Bathroom (Toilet, bathtub, shower room, bathroom cabinet, bathroom accessories such as faucet, hanger, etc.) 3. Others (Stone, art ceramic, ceramics technology, and media etc.)
Location:
China Ceramics City Add: China Ceramics City, No.2, 3rd Jiangwan Road, Chancheng District, Foshan, Guangdong, China
China Ceramics Industry Headquarters
Add: No.68, West Jihua Road, Foshan, Guangdong, China Foshan International Conference & Exhibition Center Add: Taobo Avenue, Nanzhuang Town, Chancheng District, Foshan, Guangdong, China Statistics from the 28th CeramBath
Contact Us:
Ms. Mandy Liu Tel: 86-757-82525961 E-mail: fair@eccc.com.cn Web: en.cerambath.org
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