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IN FOCUS: Sanitaryware design Iranian tiles Heavy clay automation ASEAN tableware

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Contents: AC 20-2 News

Features

6 Welcome

26 Sanitaryware design trends

The rise (and fall) of Corona virus.

Openings, closures and industry moves from across Asia.

Yogender Malik looks at how Asia’s sanitaryware industries, particularly in those areas of more nascent growth, are consolidating positions and expanding market penetration by realising the important of branding…

16 International News

42 Iranian tiles

8 Across The Continent Our eye on the international arena.

20 Material Matters

The ins-and-outs of ceramic raw materials.

22 Comment & Analysis UNIDO: a fan of Thangadh.

AC looks at how the constant pressure being applied to the Iranian economy are essentially stifling the immense potential of the country’s advanced, and highly capable, ceramic tile industry…

50 Automation in Asian brick

Jahir Ahmed looks at the impact of increasing levels of automation across Asia’s clay brick industries, and asks what it would take for the trend to become even more widespread in the next decade…

64 ASEAN tableware makers

As China continues to struggle under the impact of the current virus-related restrictions on movement and therefore manufacture, can ASEAN pick up the slack? Jahir Ahmed reviews the region…

CMY

Analysis 72 State of the Nation: Uttar Pradesh

The first of a new section in the magazine, analysing the manufacturing bases of India.

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74 Talking Shop Rohan Gunasekera talks to Mahendra Jayasekera, MD of Lanka Tiles about the company’s ground-breaking moves on Chinese co-operation and mosaic exports to the USA…

78 The Trade Matrix A new analytical section on trade trends: this issue, Nigeria’s ceramic imports.

80 Insight

Analysis and insight into Thailand.

82 The Hunter And The Hunted

William Hunter questions if the trade wars that continue apace are becoming increasingly out-dated in the current climate… www.asianceramics.com

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AC20-2

o…here we go again? The outbreak of SEE US AT: Covid-19 (Corona virus) has already had a massive impact around the IN D IAN CE RAM ICS AS IA globe, and whilst any death is tragic AH ME DABAD from such an outbreak, the fact that IN DIA 0.5m people die of basic influenza every year See Us at seems to have been forgotten. KER AMIKA However, the insatiable 24-hour media loves IN FOCUS: a crisis, and so we are plunged headlong into Sanitaryware design Iranian tiles another round of “China bashing”. It’s a curious Heavy clay automati on ASEAN tableware situation, as for ceramics, companies the virus is Plus news, views, analy sis and much more! a blessing for many of the previously adversely affected manufacturing sectors that had suffered under Chinese dumping and exports for so long. The flip-side is that whilst these companies see a chance to expand their market presence, invest in revitalizing capacity and winning orders, they are then turning to their own supply chain and realizing that a bulk of chemicals and raw materials are being sourced from the country and as such their own supplies are under threat. For end-users, tableware sourcers in particular are feeling the squeeze, as factory workers across many of the country’s more productive provinces for crockery and porcelain are restricted in movement and subsequently not returning to work. This continues to put the pressure on already stretched inventories. For those dependent on selling raw material into the country too, especially the zircon sector, glaze and colour makers and high value clays, demand is dropping as fast as the prices. With fuel costs plummeting as demand drops away and factories utiliise substantially less, so cheaper manufacture elsewhere becomes a possibility and yet such has been the dependence on the People’s Republic for so long that it is uncertain if those factories that could benefit most can actually spring into life to recapture previously lost market share. There is an adage in industry termed “maintenance of essential capability”. If you sell yourself out and become totally dependent elsewhere, generally for shorter term gain, then when a crisis hits and your supply line is disrupted, you will suffer even more than the heartland that supplies you. In Africa right now, for example, construction projects are stalling as supplies from China to fuel them slow down dramatically. Countries and sectors that allowed themselves to be opened up to Chinese involvement to such a high level are now reaping the negatives. Perhaps, therefore, instead of bashing China and seeing an opportunity for some nationalistic hubris, what about lending some support to the country that for so many has driven economies and been the ultimate supplier for so long? This crisis will pass, but the memories that China emerges with will be long lasting. Can some of these other nations really take that chance? AC COVERS.indd 1

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Cabot to purchase Sanshun Nano • RAK targets Saudi as Gulf shows slowdown • Coronavirus provides unlikely d factories to produce 100,000 jobs? • NBR reduces minimum tile import value • SCG looks at improving response s CHINA

Cabot to purchase Sanshun Nano Cabot China Limited, a wholly owned subsidiary of Cabot Corporation has entered into an agreement to purchase Shenzhen Sanshun Nano New Materials Co., Ltd (SUSN), a leading carbon nanotube (CNT) producer in China, for approximately $115 million in enterprise value that includes liabilities and contingent payments, company officials announced today. The acquisition significantly strengthens Cabot’s market position and formulation capabilities in the high-growth batteries market, particularly in China, which is the largest and fastest growing electric vehicle market in the world. As the second largest producer of CNTs globally, SUSN has capability to manufacture both dry powder CNTs and dispersions and has a proven track record of commercial success in the lithium-ion battery market. The addition of CNTs enhances Cabot’s suite of conductive carbon product offerings, which today includes the VULCAN XC-series carbon blacks, PBX® carbon

performance additives for advanced lead-acid batteries, LITX® conductive additives for lithium-ion batteries, and the recently announced ATHLOS™ carbon nanostructures. With this acquisition, Cabot will be the only carbon additive supplier with commercially proven carbon black, CNT, carbon nanostructure and dispersion capabilities. “SUSN fits strongly with our strategy of growing in the formulations space and provides a new technology platform for our energy materials business,” said Jeff Zhu, senior vice president and president, Performance Additives business. “Combining their leading CNT and dispersion capabilities with our carbon additive technology and battery expertise will create new opportunities to grow our position in the fast-growing energy storage market. This acquisition will not only strengthen our global leadership position in carbon additives but allows us to deliver new innovative solutions enabling improved battery

performance at an optimized price/performance ratio.” Blended conductive carbon additive (CCA) dispersions are being increasingly adopted by battery manufacturers to improve performance and reduce the cost of materials and CNTs are the fastest growing conductive carbon additive in energy storage. “This acquisition creates a unique opportunity for Cabot to create world-class formulated solutions and provide customers with an even more comprehensive range of products to meet their needs,” said Jim Makuc, vice president and general manager, Energy Materials. SUSN’s trailing twelve-month revenue was $28 million and the combination of Cabot’s energy materials portfolio and SUSN will create a business with approximately $50 million in revenue. Revenue is expected to grow at a rate of 20-25% over the next five years from continued growth in electric vehicles and other lithium-ion battery storage applications, making this a meaningful part of Cabot’s

portfolio of specialty chemicals businesses. SUSN commissioned a new CNT plant in China in November 2018, which has sufficient capacity to support growth over the next several years. The company will be managed as part of Cabot’s global energy materials business within the Performance Chemicals segment. The parties expect to close the transaction in the second quarter of fiscal 2020. Cabot Corporation is a global specialty chemicals and performance materials company, headquartered in Boston, Massachusetts. Founded in 2011 and headquartered in Shenzhen, China, SUSN is a leading carbon nanotubes (CNTs) and dispersions producer that supplies lithium-ion battery manufacturers both in China and globally. SUSN has a wide range of products covering single-walled CNTs, multi-walled CNTs and various blends to meet the ever-increasing needs of the battery industry.

UAE

RAK targets Saudi as Gulf shows slowdown RAK Ceramics, the UAEbased tile-maker, wants to boost its Saudi business amid a tough market elsewhere in the Gulf. The Kingdom emerged as a rare regional bright spot as it reported earnings on Wednesday that were defined by “challenging market conditions and increased competition in export markets,” it said in a statement. “Saudi Arabia has been a strong market for us predominantly in tiles, where we witnessed

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a substantial growth in the fourth quarter which reflected positively on the year-on-year growth,” said RAK Ceramics CEO Abdallah Massaad. “Looking ahead, our priorities for 2020 are to maintain our market share in the United Arab Emirates, Bangladesh and India; further grow our market in Saudi Arabia; and strengthen the overall performance of distribution entities in Europe.” Building materials exporters have been hit by the triple

whammy of a sharp slowdown in the regional housing market, a weaker oil price which has affected government project spending and a strong dollar to which some Gulf currencies are pegged — making their exports more expensive in key construction markets such as Europe. However a recent pickup in construction activity in Saudi Arabia, the largest economy in the Gulf, has been a confidence boost for the beleaguered

building sector. Overall sales slumped 5.6 percent to 2.57 billion dirhams ($684 million) on a year earlier however Saudi Arabia showed strong growth with revenues jumping more than 9 percent to 271.9 million dirhams. The projects segment in the Kingdom was stable and tiles revenue grew by 6.9 percent to 248.7 million dirhams. Meanwhile sanitaryware revenues surged by 41.6 percent to 23.2 million dirhams.

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domestic boost • Industry urged to look to advanced ceramics production • New speeds • Kajaria hit by slowdown... INDIA

Coronavirus provides unlikely domestic boost Outbreak of coronavirus in China may have negatively impacted many sectors in the country, but India’s ceramic industry, especially Morbi-based ceramic cluster situated in Gujarat, is set to gain in coming days. Due to coronavirus scare, most of the ceramic factories in China have been shut. In fact, many Chinese ceramic makers slowed down production in wake of Lunar New Year holidays from mid January. These holidays were extended due to outbreak of coronavirus. China is the biggest exporter of ceramic products, especially vitrified floor tiles in Europe, the US, fareastern countries and Africa. According to tiles makers in Gujarat, as supply from neighbouring country has stopped, China-dominated markets are now looking at Indian tile manufacturers. “We are expecting a 10% increase in exports from Morbi as result of current crisis in China. Some of the tile makers have already started exporting to Europe and African countries,” he added. If the coronavirus effect remains for longer period of time, definitely Indian ceramic exporters would be able to export their products in some of the markets where Indian ceramics are exported negligibly, said Jetpariya, adding that at the same time, Indian ceramic units may face shortage of important chemicals which are being imported from China. “Generally ceramic factories have couple of months of inventories of these important chemicals being used

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for coating in vitrified tile manufacturing. If we don’t get chemicals from China, ceramic units will have to import from Spain which would be costlier,” said Dinesh Sadsania, a leading exporter of Ceramic products from Morbi. Approximately 1,000 ceramic units are functioning in Morbi cluster and provide employment to more than four lakh people. Against the annual turnover of Rs 45,000 crore, exports from Morbi cluster is nearly Rs 12,000 crore. By the end of 2019 the cluster witnessed more than 55,000 cubic meter production of tiles per day. Though ceramic products are exported to over 170 countries, around 40% is exported to Gulf countries only. In the current scenario, Morbi based exporters are looking at unexplored market where predominantly China has lion’s share. Presently, there are 54 ceramic factories that are manufacturing tiles, tableware and sanitary ware. BCMEA data showed tiles and sanitary ware’s domestic demand to be higher than the existing production capacity. Three tiles makers -Excellent Ceramic Industries, Hi-Tech Ceramics and Top One Ceramics -- will hit the market in three months. Another five factories of Akij Ceramics, JB Ceramics, Bangladesh Ceramic Industries, New Zhong Yuan Ceramics, and Sarmano Ceramics are expected to go into production next year. Four new companies, all tiles makers, are expected to commence production in 2021, according to the

BCMEA. “Local demand for ceramic products is increasing. Even factories that were set up with an export target are selling goods in the local market,” said Irfan Uddin, general secretary of the BCMEA and a director of FARR Ceramics. He said an entrepreneur has to spend at least Tk 150 crore to establish a factory. Even then, new companies are coming in seeing business prospects both at home and abroad. Shirajul Islam Mollah, president of the BCMEA, said ceramics is an emerging sector and has huge export potential. “We had to depend on import for ceramics two decades ago. Now we are almost self-sufficient in tableware and sanitary ware,” said Mollah, also the managing director of China-Bangla Ceramic Industries. When the companies in the pipeline start production, Bangladesh will be able to earn $1 billion from export of ceramics by 2025, he said. He hailed the government for giving 10 percent cash incentive on exports since fiscal 2017-18, but believes 25 percent would boost exports significantly. According to industry insiders, Bangladesh has duty-free access to European markets under the generalised system of preferences (GSP) that can increase export of ceramics there. Availability of natural gas and cheap labour are two other competitive advantages Bangladesh enjoys over other countries. But a lack of skilled workforce is a problem for the sector.

NEWS IN BRIEF Turkish ceramic exports could rise by nearly a third this year, one of Turkey’s largest ceramic firms has said as producers in China struggle with the impact of the coronavirus outbreak on top of U.S. tariffs. An outbreak of the newly identified coronavirus that emerged in December in Wuhan, China has killed at least 1,380 people, prompting many factories to suspend operations as authorities try to contain its spread. “Turkey’s ceramics producers will increase exports by some 30% this year as demand will shift towards here from China,” NG Kutahya Seramik chairman Erkan Gural said, “This will increase capacity usage in the sector.” The company is considering investing 350-400 million lira (about $60 million) in a new factory due to the spike in demand and will finalise details in the coming weeks, he said. “Ceramic sector fairs organised in the USA and Spain in the recent weeks show that product demand is shifting towards Europe and Turkey after the coronavirus outbreak in China.” There was already a shift to Turkish ceramics as the United States imposed additional tariffs on Chinese products in the fourth quarter, Gural said, but demand has appeared to accelerated.

AC 20-2

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BANGLADESH

Industry urged to look to advanced ceramics production Bangladesh should look beyond the traditional usage of ceramics and produce more value-added items with a view to capturing a vast global market, entrepreneurs and experts said. The ceramics industry in Bangladesh started its journey in the late 1950s and the ceramics sector is booming. But the industry is mainly focused on traditional ceramics, namely tiles, kitchen ware, and sanitary ware, while technical ceramics market is largely non-existent. “I think we need to work more on innovative products, which will cater to the current needs of the people,” said MA Jabbar, managing director of DBL Group, the owning company of DBL Ceramics Ltd. Since the demand for hightech ceramic products is rising steeply for energy conservation and remediation of environment, including value-added products’ diversification, Bangladesh – in line with the activities of the rest of the world – should go for high-end ceramic products along with traditional ceramics, said Abdul Matin, professor of the Department of Glass and Ceramic Engineering at the Bangladesh University of Engineering and Technology (BUET). Globally, the use of advanced ceramics, technical ceramics, is growing. Ceramics are being used to produce heat-insulating light-weight ceramic fibres for conservation of heat in industrial kilns, melting and high temperature heat-treatment furnaces, air-conditioning ducts, vests for ballistic impacts, armour-shielding vehicles, insulators, spark-plugs, sensors, actuators, superconductors and giant magnetism for magnetic levitation (highspeed train), optoelectronic devices and cancer treatment (hyperthermia), according to Prof Matin. Nano-materials based on ceramics have enormous potential applications in energy and environmental sectors. Other applications include thermal-barrier coating, anti-

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reflecting coating for solar panel, anti-bacterial tiles, wall surfaces for environmental remediation, industrial effluent and dye-degradation and toxic elements’ separation, including water purification through ceramic nano-materials, he said. The global advanced ceramics market is expected to grow from USD 66.47 billion in 2017

potential for high export of this value-added product for the economic development of the country. In addition, the development of ceramic nano-materials has market potential of more than USD 300 billion all over the world targeted to reach USD 1 trillion by 2025. “It would be a big opportunity for Bangladesh to be a part of

“Our efforts should be on how to accelerate our exports by introducing new products.” to USD 141.53 billion by 2025, at a compound annual growth rate of 9.91 percent during 20182025, according to a study titled “Advanced Ceramics Market by Material” by Fior Markets, a market intelligence company, based in Maharashtra, India. Advanced ceramics have emerged as a perfect, costeffective, high-performance alternative to traditional materials such as metals, plastics, and glass. Prof Matin said there is a huge demand for advanced ceramics all over the world, including Bangladesh, for sustainable development and to achieve the targets of the Sustainable Development Goals by 2030. A prerequisite of this demand from the Bangladesh perspective is tremendous research and development (R&D) and close collaboration between industries and academia to innovate diversified value-added ceramic products to meet the challenges of environment, energy and public health. Prof Matin said microelectronic industries are heavily depending on silicon wafers for all sorts of microelectronic devices and their application. Though challenging, in near future Bangladesh can manufacture silicon wafers, which would be cost-effective and has the

this endeavour, the vast ceramic nano-material market and its products in the near future,” Prof Matin said. R&D is taking place in Bangladesh to develop new products. For example, Shinepukur Ceramics Ltd as an industrial partner has been engaged under a government project with the GCE department to develop heat-insulating ceramic fibres for industrial application. It has successfully produced ceramic fibres using a pilot plant installed at BUET. The company has a plan to scale it up for mass production. In addition, a low-cost ceramic water filter has been developed at the GCE department in collaboration with Shinepukur Ceramics. This can be commercially produced. DBL Ceramics, with its own finance, is conducting a R&D project under a memorandum of understanding with the GCE department to produce solar-grade silicon wafers from quartz (sand). In the first phase, metallurgical-grade silicon (MGS) will be produced using a newly designed and built electric arc furnace. In the second phase, MGS will be purified to solar-grade silicon. Fortunately, R&D of nanomaterial synthesis and

characterisation and small-scale application of nanotechnology has already started with enormous enthusiasm within researchers of universities and research institutions in Bangladesh and gradually gaining momentum to reach a platform from application point of view, according to Prof Matin. Md Shirajul Islam Mollah, president of the Bangladesh Ceramic Manufacturers and Exporters Association, said if exporters get incentives from the government, the sector will advance like the garment sector. Md Shamsul Huda, managing director of Great Wall Ceramic Industries Ltd, said new ceramic factories are being set up and their usage has expanded significantly. The rising demand has prompted companies to think about new products and designs. “Our efforts should be on how to accelerate our exports by introducing new products.” Tanvirul Islam, head of marketing of Shinepukur Ceramics, said the company has some innovations. For example, it has innovated two types of raw material preparations that allow it to produce more white porcelain. It has produced a raw material that has whiteness like that of bone china although it is porcelain. Another raw material allows it to produce products that have more whiteness than porcelain and have translucency, Tanvirul said. The company is recycling waste of ceramics and re-using it. It does not affect the quality of the product. As a result, the waste ceramics are not being left in the environment. “In order to capture the market, more investment will be needed to scale up production capacity. High-quality products have to be manufactured and efficiency has to be increased to be price-competitive,” he said. MA Jabbar said DBL Ceramics introduced technical porcelain for the first time in Bangladesh with an impressive feature of anti-slippery.

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BANGLADESH

New factories to produce 100,000 jobs? When some industries are struggling with liquidity crisis and high lending rates, the ceramics sector has been getting five new factories on an average every year since 2017, industry players said. Riding on steady economic growth and rising purchases of consumers, another 15 factories are in the pipeline with an estimated investment worth around Tk 3,000 crore. These plants are expected to begin commercial operations in the next four years and will create much-needed employment for nearly 100,000 people. After entering the market with tiles and sanitary ware two years ago, Akij Ceramics is now investing a fresh Tk 500 crore to set up a tableware unit. “We have already imported machines and installations are going on,” said Mohammod Khourshed Alam, director for sales and marketing. The factory has set a target to produce 250 lakh pieces of tableware, which will elevate Akij to the ranks of Monno Ceramic

Industries as the largest producer, according to data of the Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA). As tableware has huge prospect in overseas markets, Akij will export the items and sell it in the local market as well, Alam said. Meghna Group of Industries, one of the country’s largest conglomerates, is investing Tk 400 crore to set up a tiles factory at its economic zone in Narayanganj. “We hope to start commercial production by mid-next year,” said Mostafa Kamal, chairman and managing director of the group. Ceramics is a capitalintensive business as setting up a factory takes Tk 150 crore to Tk 200 crore. Presently, there are 54 ceramic factories that are manufacturing tiles, tableware and sanitary ware. BCMEA data showed tiles and sanitary ware’s domestic demand to be higher than the existing production capacity. Three tiles makers -- Excellent

Ceramic Industries, Hi-Tech Ceramics and Top One Ceramics -- will hit the market in three months. Another five factories of Akij Ceramics, JB Ceramics, Bangladesh Ceramic Industries, New Zhong Yuan Ceramics, and Sarmano Ceramics are expected to go into production next year. Four new companies, all tiles makers, are expected to commence production in 2021, according to the BCMEA. “Local demand for ceramic products is increasing. Even factories that were set up with an export target are selling goods in the local market,” said Irfan Uddin, general secretary of the BCMEA and a director of FARR Ceramics. He said an entrepreneur has to spend at least Tk 150 crore to establish a factory. Even then, new companies are coming in seeing business prospects both at home and abroad. Shirajul Islam Mollah, president of the BCMEA, said ceramics is an emerging sector and has huge

export potential. “We had to depend on import for ceramics two decades ago. Now we are almost self-sufficient in tableware and sanitary ware,” said Mollah, also the managing director of China-Bangla Ceramic Industries. When the companies in the pipeline start production, Bangladesh will be able to earn $1 billion from export of ceramics by 2025, he said. He hailed the government for giving 10 percent cash incentive on exports since fiscal 2017-18, but believes 25 percent would boost exports significantly. According to industry insiders, Bangladesh has duty-free access to European markets under the generalised system of preferences (GSP) that can increase export of ceramics there. Availability of natural gas and cheap labour are two other competitive advantages Bangladesh enjoys over other countries. But a lack of skilled workforce is a problem for the sector.

BANGLADESH

NBR reduces minimum tile import value The National Board of Revenue has reduced the minimum import value, based on which the revenue board determines customs duties and taxes, for ceramic tiles and toothpaste following importers’ demand. Customs wing of the revenue board in January issued a statutory regulatory order, reducing the value by up to $1 a square metre on import of ceramic tiles of different sizes. According to the SRO signed by NBR chairman Abu Hena Md Rahmatul Muneem, the new minimum import value will range from $5.25 a square metre to $11 a square metre of the products. Previously, the highest

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minimum value was $12 a square metre for large-sized ceramic tiles and the lowest value was $6 a square metre for small-sized ceramic tiles. The NBR also set afresh the minimum value at $11 a square metre for the ceramic tiles of the other sizes. Customs officials said that they rescheduled the minimum import value for the products in line with recommendations made by a NBR committee. They said that the importers of ceramic tiles had demanded reducing the value as previously the value was determined based on value higher than the actual import value. The reduction in the minimum import value

of ceramic tiles would reduce the prices of the products on the domestic market, they said. The NBR set the value for the purpose of customs valuation as there are allegations that importers hide the actual import value and declare lower value to evade duties and taxes. Customs duties and other taxes at the import stage are calculated based on the minimum value irrespective of the actual transaction value of the products. Experts and traders always oppose imposition of the minimum value on import of any product, arguing that the practice is the violation of the rules of the World Customs

Organisation. Customs valuation should be based on transaction value of a product, they said.

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THAILAND

SCG looks at improving response speeds SCG is set to revamp three core businesses and equip human resource development to effectively shift from being a manufacturer to a solution and service provider, with an eye of maintaining sustainable business growth in 2020 through the use of “digital technologies to respond swiftly to the competitive environment.” SCG unveiled its business strategies to overcome disruptions spawned by looming uncontrollable external factors in 2020, with the accelerated transformation of internal factors right. after announcing its Operating Results for 2019. Roongrote Rangsiyopash, President and CEO of SCG, said: “Fluctuations driven by uncontrollable external factors has made a significant impact on businesses globally over the past year. As a result, in 2020, SCG is necessitated to develop comprehensive business strategies aiming at conquering disruptions promptly and maintaining sustainable business growth. With a business transformation plan, the three core businesses will shift from being a manufacturer to a solution & service provider that truly and holistically respond to the diversified and everchanging customer demand

as well as creating high value for the business. People Transformation is also a crucial force to drive change. SCG will strive to empower our people with essential skills, enabling them to insightfully access and understand markets across the region coupled with leveraging digital technologies to respond swiftly to the competitive environment and meet those needs timely.” C e m e n t - B u i l d i n g Materials Business aims to comprehensively enhance the industry and living sector with products and services incorporating digital technologies. A wide array of solutions includes Construction Solution that provides better performance, faster process and improved cost-saving construction solutions for technician and contractors such as BIM (Building Information Modelling) which helps enhance planning and construction quality through 3D model system, minimizing construction waste; and Living Solution that provide energy-saving, increased comfort, and safety for all ages. Besides, the business has upgraded its Retail Business by integrating physical stores with an online store. Packaging Business foresees

an excellent opportunity to build high growth, especially in the ASEAN as it has emerged as one of the world’s highest growing regions. SCG will accelerate the path to become the packaging solutions provider and be part of customers’ daily lives, coupled with augmenting packaging sales of industrial customers that have substantial growth and demand for packaging materials such as food and beverage, frozen food, canned food, consumer product, electronic product, and e-commerce business. Moreover, SCG also provides solutions catered to meet special needs, i.e., design and printing solution, smart packaging solution, exhibition and market promotion solutions, and ecofriendly and sustainably sourced products and services, in line with the Circular Economy. The efforts are to hone the competitive edge and maintain the position at the forefront of the region in total packaging solutions. For investment, SCG will continue delivering solutions, products, and services of 3 core businesses to satisfy customers throughout ASEAN, especially in Thailand, Vietnam and Indonesia, which show high potential and sizeable growth, plus seeking opportunities

in emerging market in other regions through collaboration with groups, organizations, institutes, and other sectors at home and aboard to generate business opportunities and enhance the living quality of people, community, society, and environment in line with the commitment of “Passion for Better,” better and faster.” Meanwhile, SCG subsidiary United Pulp and Paper Co., Inc. (UPPC) celebrated its 50 years in the business last December 2019, with employees and key customers. As the Philippines’ leading manufacturer of high-quality industrial-grade paper for packaging products, UPPC provides the best for all its stakeholders by continuously developing innovation to respond to changes over the years. In addition, Mariwasa Siam Ceramics Inc., another SCG subsidiary that is the leading ceramic tile brand in the Philippines, improved its operation with the new state-ofthe-art kiln, considered as the largest in the country. Towering over 212m in length and capable of producing a maximum tile size of 800mm x 1200mm, it also produces an additional output of 5.8 Million sq.m/year.

INDIA

Kajaria hit by slowdown Kajaria Ceramics, the largest manufacturer of ceramic and vitrified tiles in India, has reported a 5 per cent decline in profitability during the third quarter of current fiscal at Rs 61.54 crore due to sustained weakness in real estate sector and continued slowdown in the overall economy. The company had reported a consolidated profit of Rs 64.8 crore in Q3 FY19. Revenue growth in Q3 FY20 fell by 2 per cent to Rs 741.3 crore from Rs 758.56 crore in Q3 FY19 despite sales growing by 1 per cent to Rs 20.44 crore from Rs

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20.34 crore in the same period. In terms of quantity, Kajaria recorded a 7 per cent rise in production to 17.37 million square metres in Q3 FY20 from 16.31 million square metres in the corresponding period of the previous fiscal year. The board of director has withdrawn expansion plan of manufacturing capacity of polished vitrified tiles at the existing facility at Malutana in Rajasthan. The demand environment for tiles in Q3FY20 continued to be sluggish led by sustained weakness in the real estate

sector and continued slowdown in the overall economy, the company said in a statement. With the liquidity concern prevailing in the market, the festive demand uptick was missing, impacting the sales volume. “In these tough times, our major endeavour is to focus on further strengthening our brand equity through sustained branding measures and maintain our balance sheet strength with working capital discipline being a major focus area,” it said. “We expect improvement in volume off-take in next fiscal due

to various positive measures taken by the government to boost demand with a special focus on incomplete housing projects by infusion of Rs 25,000 crore, improving liquidity by reforms in the banking sector and tightening of GST compliances.” ceramic and vitrified tiles in the world. It has an annual capacity of 73 million square metres distributed across eight plants — one at Sikandrabad in Uttar Pradesh, one each at Gailpur and Malootana in Rajasthan, three at Morbi in Gujarat besides one each at Vijaywada and SriKalahasti in Andhra Pradesh.

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News

International News

Italtile calls for government boosts South Africa

he CEO of SA’s largest manufacturer of ceramic tiles has weighed in on the struggling economy saying that the government should spell out plans to stimulate growth and protect local manufacturers. The moribund economy has stifled household consumption expenditure to the detriment of listed tile manufacturer Italtile, whose brands include CTM, TopT and U-Light. Speaking after the release of the company’s results for the six months ended December 31, Italtile CEO Jan Potgieter said the government should come up with an incentive to stimulate investment in infrastructure. “The current economic growth is not enough. We need a massive

step change in the general economy to stimulate growth. We must also fix some of the state-owned companies. We need certainty. I think it is time we stop talking and start implementing. The government must build confidence,” Potgieter said. He said local tile manufacturers also needed protection in the form of tariffs against cheaper imports from China, India, Italy and Spain. “As a local manufacturer, we need some protection. We see what the rest of the world is doing to protect local manufacturers. We want to compete on the global stage. So it is no use if people can come and dump products. We are still optimistic about the long-term future and that it why we are investing in manufacturing

facilities. So it is important that we get some protection,” Potgieter said. Italtile, a manufacturer, franchiser and retailer of tiles, bathroom ware and other homefinishing products, has become the latest company to voice displeasure about imports, joining some of the largest chicken and cement makers. “We need to compete on equal footing. We know that, from a cost point of view, we are extremely competitive,” he said. Potgieter said the low economic growth would not derail Italtile’s expansion plans. “We will keep on investing. Despite the negativity out there, we want to gain market share. We are going to compete vigorously

to gain that market share. We are going to drive costs down in order to remain competitive,” he said. Italtile spent R165m in a store upgrade programme, while it spent another R113m in its manufacturing operations. In the six months to December, Italtile’s system wide turnover increased 1.4%, from R5.3bn to R5.4bn. System-wide turnover refers to group turnover, including franchisees, but excludes sales from owned supply chain businesses to its stores. Revenue from group-owned stores and businesses was R3.8bn, up from R3.7bn. In the six month, Italtile opened 10 stores, with another five to eight to be opened in the next six months.

Ceramic tiles experiences slowdown Italy

he Italian ceramic tile industry concluded 2019 without significant changes in production, sales and export volumes compared to 2018. According to preliminary figures published by Prometeia, the sector produced and sold 409 million square metres of tiles (compared to 410 million sq.m in 2018). Exports dropped by 2 million sq.m to 326 million sq.m (down 0.6% on 2018), while domestic sales rose by 1 million sq.m to 82 million sq.m (+1.2%). Amongst the key markets, sales in Italy and Europe accounted for around two-thirds of the total and saw growth of a few percentage points, unlike exports outside the EU which in some cases experienced significant contractions. One example was the Middle East, where several countries have put up non-tariff barriers to ceramic imports. Amidst essentially stagnant demand but higher production capacity due to the large-scale investments made in recent years, some companies chose to stop production for a few weeks at the end of the year to avoid overfilling their warehouses.

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Introducing and commenting on the sector data, Confindustria Ceramica Chairman Giovanni Savorani pointed out that international trade in all sectors is being hit by the growing global trade tensions (particularly but not solely between the United States and China), which is generating uncertainty amongst consumers and professionals. “Recent studies show that the countries that have been worst affected by this situation are big exporters and those with a large public debt, both of which are conditions that apply to Italy,” he added. Confindustria Ceramica and the companies it represents are particularly concerned about the competitiveness of the Italian production system in an increasingly competitive market context. Savorani believes that Italy’s competitiveness continues to be penalised by the higher labour and energy costs and inadequate road and port infrastructures compared to other competitor countries. As for energy costs, Savorani voiced strong concern regarding the European Emissions Trading system, which in the absence of appropriate intervention during

the review of the directive by the European Commission will effectively increase the competitive gap with respect to non-European production. “Over the next 10 years, the ETS directive will bring an estimated extra cost for the Italian ceramic industry of more than €30 million/ year,” he explained. “These costs are a kind of tax on product factors but without taking account of the investments that have been made and the extremely high levels of efficiency that have been reached. Major technological advances capable of bringing further significant reductions in emissions are unlikely to be seen in the next few years.” The Italian ceramic industry’s commitment to environmental sustainability was further demonstrated by the voluntary emissions reduction agreement signed on 7 December by Confindustria Ceramica and the 10 municipalities making up the ceramic district, the provinces of Modena and Reggio Emilia and the Emilia Romagna regional government. “This innovative agreement, the only one of its kind in Italy, establishes a general cap for the emissions of the district

as a whole, while the individual companies already have much lower emission levels than those established by the European Union,” said Savorani. “It aims to improve the competitiveness of our companies through actions such as standardised authorisation procedures and reduction of the timeframe for issuing integrated environmental authorisations to 45 days.” Along with major investments in technological innovation and sustainable development (2 billion euros over the last 5 years), Giovanni Savorani also pointed out that the Italian ceramic industry is working to improve its competitiveness in other ways. These include professional training (through agreements with schools and universities and the launch of the 2nd level ‘Ceramic business and technology’ Master’s course) and communication. Following its launch last year, the digital campaign entitled ‘The values of ceramics’ has received more than 12 million views thanks to the involvement of more than 60 Italian companies and foreign associations of producers, distributors and installers.

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News

Siti completes Diatex acquisition Italy

ITI B&T Group, manufacturer of complete systems for tiles and sanitaryware listed on the AIM Italia market, has completed the acquisition of 75% of the parcel of shares in Diatex, a company in Villaverla (Vicenza), active in the production of diamond tools for stone, ceramics and glass processing. The transaction has a total value of 7.5 million Euro. Thus, the position of SITI B&T Group as a supplier of complete systems located in the ceramic

district, where there is its headquarters and all the Research & Development activity concentrated in the BT-Lab technology centre of Formigine and with operating arms all over the world, is further strengthened. “This acquisition comments Fabio Tarozzi, CEO of SITI B&T Group - allows us to promote new synergies with the finishing technologies of our company Ancora, to offer the market new high-performance products and new services. Diatex

will be able to give a strong boost to exports thanks to our international network, which has over 20 branches”. Therefore, SITI B&T Group continues to invest and grow, uniting with an excellence in a fundamental niche for surface finishing, a leading company in its segment with strong ceramic skills. Diatex and SITI B&T have already developed diamond discs together for an innovative green cutting system for the Supera® line installed at the customer Best

Surface, in Spain, where slabs of thicknesses from 6 to 30 mm w are produced. In addition to the cutting discs, the Diatex catalogue includes squaring wheels for ceramics, in particular for dry squaring, in which Ancora (the SITI B&T Group company specializing in tile finishing) stands out with its high speed solutions, which guarantee maximum productivity in the world. In 2018 Diatex S.p.A. generated a turnover of 10.7 million Euro.

Government to review dumping duties United Kingdom

he Government announced at the beginning of February that it will begin reviewing 43 EU trade remedy measures, which were deemed important to UK industries and should be maintained, following a Call to Evidence last year. This will be carried out by the Trade Remedies Investigations Directorate (TRID). Trade remedies will be overseen by a new Trade Remedies Authority that will soon be established to protect UK businesses from injury

caused by unfair trading practices, such as dumping and subsidies and unforeseen surges in imports after we leave the EU. Examples of those trade remedy measures that will be reviewed by TRID following the Call for Evidence include: • anti-dumping duties of up to 36.1% on imports of ceramic kitchen and tableware from China; • anti-dumping and anti-subsidy duties of up to €62 per tyre on imports of bus and lorry tyres from

China; and • anti-dumping duties of up to 35.6% on imports of aluminium foil in small rolls. TRID They will invite industry and stakeholders to participate in the process, including international exporters. Simon Walker CBE has today been announced as Chair-Designate of the TRA and is expected to take up the position in early March. Trade Remedies Authority ChairDesignate Simon Walker said:

“I am very pleased to be taking up the Chair of the Trade Remedies Authority. Britain’s economic future will be determined by the ability of UK businesses to compete vigorously in international marketplaces. Maintaining the interests of consumers while ensuring that producers are not handicapped by dumping and other unfair practices is going to be a vital balance as Britain embarks upon an independent trading regime.”

Portmeirion eyes the future United Kingdom

ortmeirion Group, the designer, manufacturer and worldwide distributor of high quality homewares under the Portmeirion, Spode, Royal Worcester, Wax Lyrical, Nambé and Pimpernel brands, was pleased to announce that it expects revenue and profit before tax for the year to 31 December 2019 to be in line with revised market expectations. Revenue for the year ended 31 December 2019 will be at least £92 million (2018: £89.6 million), representing an increase of 3% over the previous year. This includes the positive effect of the Nambé acquisition in July 2019. The expected like-for-like decline in sales of 5% is driven by lower sales in our export markets for our Portmeirion Botanic Garden ranges as previously reported. The sales decline was largely a

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result of historical overstocking due to the level of reshipping from other markets into South Korea. Portmeirion invested considerable resource in 2019 to resolving this issue and has said that it has made good progress. It is the intention to continue to focus on this in 2020 in order to protect demand in South Korea in the long term. “We are nevertheless pleased with the performance of our business in other areas during 2019. Against a tough economic backdrop, with many UK retailers experiencing a consumer downturn, our UK market grew by 5%” said the company. “Our migration towards online continues with total online sales in our core UK and US markets growing by 17% year on year. We now estimate that 30% of our total UK/US sales are made through online channels

reflecting the strong progress we have made in the transition to online. Sales from our own ecommerce platforms grew 16% year on year and are expected to continue to grow strongly in 2020. Online sales remain a key area of strategic focus for the Group” the company added. Excluding the benefit of Nambé, the US market, the largest for the Group, declined by 12% in US dollar terms. This decline was driven by our strategy to reduce reshipping into South Korea, and this market should return to growth in 2020. Mike Raybould, CEO, said: "Whilst 2019 was a challenging year, we have taken a long term view to protect our brand in our South Korean market. This has caused us short term pain through reduced export sales of Portmeirion Botanic Garden and

increased cost and disruption to our factories from developing a large number of new ranges. However, we believe we have now made good progress in stabilising this key market. “We are confident in our strategic plan and the long term opportunities to grow our business. In 2020, we intend to further increase investment behind key strategic areas such as driving online growth and brand marketing including campaigns and product launches to celebrate the 250th anniversary of Spode. The integration of the Nambé business continues to go well and we look forward to seeing the anticipated benefit in future sales growth. " “We expect to announce the Group's preliminary results for the year ended 31 December 2019 on 19 March 2020.”

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News

Raw Material News Mining law change to ease import dependence? EGYPT // GENERAL Egypt issued new regulations that appear to eliminate the need for mining companies to form joint ventures with the Egyptian government and to limit state royalties to a maximum 20%, measures long advocated by the private sector. The cabinet released a summary of the executive regulations to the mining law after its weekly meeting on Wednesday. The law itself was issued in August. Mining companies have long complained that Egypt’s system of mandatory joint ventures, stiff royalties and profit sharing agreements have made it unprofitable to explore for and exploit minerals. The cabinet statement indicated that although the Egyptian Mineral Resources Authority had the right to form joint ventures with a minimum state ownership of 25%, private mining companies would not necessarily have to do this if

their mining agreements were ratified by law. The statement also said mining companies would have to pay a rental value for their mines and quarries as well as royalties at a separate rate determined for each type of ore extracted. “The royalty will not be less than 5% or exceed 20% of ore produced each year by the licensee,” the cabinet statement said. Private mining executives said they were waiting for a copy of the actual regulations, but if the requirement for joint ventures had indeed been eliminated Egypt could well see huge interest by exploration companies. “That is the highlight of the new regulations, something we have been chasing for a decade,” one executive said, asking not to be named.

Halloysite shows up on Latin drills AUSTRALIA // KAOLIN The prospectivity of Latin Resources’ south-west WA project has taken a few leaps forward with the ASX-listed explorer confirming the presence of halloysite at its Noombenberry project. The company recently took a suite of first-pass surface geochemical samples at the project that have now been analysed by leading UK-based rare minerals specialist, Frank Hart from First Test Minerals. The samples were picked up as part of Latin’s due diligence work on the ground with the first round of raw assays returning aluminium oxide grades of up to nearly 27%. First Test looked at the kaolin and halloysite clay content of the samples and the quality and future sales prospects or the product. New high-grade 45 to 180-micron sized kaolin samples were identified with up to 15% halloysite content by weight and up to about 68% kaolinite by weight. Latin Managing Director Chris Gale said: “We are pleased to have achieved our aims in this testing exercise, those aims being to identify high grade kaolinite and the occurrence of halloysite at Noombenberry and to identify the best locations for further drill programs...” “With hungry global markets for high grade kaolin and a developing market for halloysite, we believe we have a

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potentially valuable project here at Noombenberry that we are keen to evaluate carefully and thoroughly in 2020”. Halloysite is a rare form of clay that exists as microscopic “tubes” or “plates”. It generally commands a premium over other clays such as kaolin that is often used as feedstock to produce in-demand high purity alumina. Halloysite has a range of applications in the market that are dependent on the mineral’s properties such as “tube size” and volume. Some of the samples taken by Latin showed good halloysite mineral occurrences, with the mineral forming as nanotubes, plates and prisms. Emerging high-value markets for halloysite present in the form of “nano-applications” in the technology space – notably, the global medical industry demand for halloysite is expected to register a CAGR of 7.1% to 2025. The unique tubular form and high surface area of this mineral have proved useful for controlled and sustained drug release. Latin’s flagship project is located within trucking distance of Perth and all major services for a low-cost mining operation are within cooee. Latin will most likely churn out some interesting newsflow in the coming months as it starts to get a handle of the opportunity before it at Noombenberry.

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News

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News Anaylsis

News

asian ceramics

UNIDO: a fan of Thangadh…

hangadh as an industrial town has seen the most flourishing business in manufacturing and exporting sanitaryware. Shunning traditional ways of manufacturing, the sanitaryware sector is now embracing new technology. Home to 225 ceramic units with product categories such as sanitaryware, refractories, wall tiles and art tiles in its kitty, this industrial town has seen the most flourishing business over time in sanitaryware. It is also one of the 12 energy-intensive MSME clusters covered under the GEF-UNIDO-BEE project, which looks at selected clusters in India to promote energy efficiencies. It isn’t surprising to understand why the spotlight is on this small town that is tucked away from the city humdrum. Out of the total sanitaryware exports from India, 70% is from Thangadh with African, Gulf and Arabic regions making up major markets. Reasons such as easy availability of raw material and labour being reasonably cheap are factors that aid the town’s growth. “The cost of the production is very less and quality produced is accepted in the major export markets. This makes exports from here being higher,” says Ashwin Maru, Production and Export Executive at Thangadh-based Sunrise Pottery Works, a leading exporter and manufacturer of ceramic products. The factory shows off a range of sanitaryware in different colours, shapes and sizes customised as per the export market demand. Maru narrates their story of how the company started off with manufacturing cup saucers, dishes and plates when established in 1976. “We started sanitaryware in 1982 and till date, we are exporting our goods to various countries by taking many steps to upgrade our products,” he reminisces The association with UNIDO-BEE came through five years ago for the cluster and the project aimed at supporting MSME units in

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implementing a range of energy conservation measures. For instance, 15,000 conventional ceiling fans were replaced with 15,000 energy efficient ceiling fans. “More than 60% of energy was saved by the change of fans. These are Brushless Direct Current (BLDC) fans from Mumbai as opposed to the rewinding ones that existed previously,” highlights Maru. A crucial stage in the manufacturing process is the shaping of sanitary ware by putting the clay in Plasterof-Paris moulds. The moulds need to be completely dry within a span of 24 hours for the next step of the shaped item to be cast. Earlier conventional ceiling fans were used in the drying process which were low on energy efficiency and consumed around 75 Watts power per day. After replacing the fans in factories to 28 Watt BLDC fans, a 60% saving on electricity was noticed, which translates To a saving of Rs 15,000 per month. There have been other changes as well that have created an impact. Installation of rooftop solar power systems in ceramic units to produce solar electrical energy totalling 1100 KW, low thermal mass car in tunnel kiln, use of new technologies such as high speed blunger technology in place of ball mills have also led to cost and energy savings in the units. “Previously in our tunnel kiln, the weight of the car was too much. Gas consumption will be low if the weight is low. After UNIDO introduced lightweight car trolley, 50% of the weight was reduced and due to that we saved 7% gas consumption per day, which was a remarkable energy saving for us,” reveals cluster leader Pradip Vora. In fact, for the cluster, conservation is slowly being ingrained in everything they do. Manufacturers are sprucing up their production techniques and now giving due importance to the end product itself. Maru highlights that through research and development initiatives they have been able to cut down on the amount of water needed to get a flush working. “Earlier, European Water Closet (EWC) required

almost 6-7 litres for flushing. Now we have developed EWC of 3-3.5 litres per flush. So we are saving a lot of water through such unique techniques,” he says. Exports make up 98% of his business. While water is used when the material is mixing to give shape to ceramic products, electricity is used to run ceiling fan, motor, pump, compressor and other machines as electrical. “Each factory of Thangadh consumes more than 1000 cubic metre gas per day. The cost of natural gas is between Rs 35 to 40 per cubic meter, which means each factory’s spends about Rs 35,000 to 40,000 per day to produce 10 metric ton i.e for 900 pieces per day. There is maximum gas use in this cluster, which implies that is adequate scope here to save by changing burners, designs etc,” adds Vora. In fact work has already started in this regard. Carbon emissions have reduced significantly since UNIDO-BEE set afoot. After using low thermal mass car energy saving technology, the gas consumption reduced upto 8% per metric ton of sanitaryware production. Vora recalls one factory in the cluster that implemented various technologies could boast of a reduced electricity bill of Rs 80,000 as against Rs 1,75,000 earlier. However, despite the benefits that have come in, some challenges still remain which deter Thangadh from reaching its full potential. Maru talks about further reductions in consumption of gas. “We are using CNG for firing of sanitaryware and by adopting the technology of lightweight trolley, we have reduced our consumption reasonably. However, we still need to reduce the weight further to ensure even greater savings,” he says. The natural gas for furnace to fire 1 metric ton ceramic sanitaryware (about 90 pieces of sanitaryware) needs 110 cubic meter of natural gas to fire at 1200 c temperature. With energy efficiency methods this has been brought down to the levels of about 100 cubic meter of natural gas.

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The brand you can trust

Takahama Industry Co.,Ltd. Head Office 2-2-1 Hashiman-cho, Takahama-city,Aichi-Pref,444-1302,Japan TEL +81-566-52-5181 FAX +81-566-52-5960 E-mail info@takahama-ind.co.jp URL http://www.takahama-ind.co.jp

Analysis: Sanitaryware

All in a nam sanitaryware branding takes centre-stage

Yogender Malik looks at how Asiaâ&#x20AC;&#x2122;s sanitaryware industries, particularly in those areas of more nascent growth, are consolidating positions and expanding market penetration by realising the important of brandingâ&#x20AC;Ś

anitary ware industry in Asian countries has evolved significantly in scale and scope over the last twenty years. During the last two decades, Asian sanitary ware production has increased by more than fourfold. The continent is not alone the largest producer and consumer of sanitary ware products, it is also the largest exporter of sanitary ware products. In 2018, Asian countries (including China) held a 64 % share in the global ceramic sanitary ware exports. Global sanitary ware exports in 2018 stood around 3.73 million tonnes. It is no small feat that Asian producers accounted for 2.38 million tonnes of sanitary ware exports. A large proportion of these exports goes to some of the most quality conscious and discerning markets of Europe and Americas, which indicates the prowess of producing counties. A number of reputed sanitary ware producers have emerged in the Asian countries. Companies such as Toto Limited and Lixil Corporation ( Japan), Hindustan Sanitary ware Industries Limited, Cera Sanitary ware ( both from India), RAK Ceramics ( UAE, Bangladesh and India), Saudi Ceramics ( Saudi Arabia) and Siam Sanitary ware ( Thailand) have emerged as some of the most prestigious names in domestic, regional and global ceramic sanitary ware market on account of huge investments in their production capabilities, which have enabled these producers to produce global standard sanitary ware products.

Designs and styles

As a product that need to keep abreast of the changing needs, methods, styles and technologies, sanitary ware producers invest

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huge resources towards new designs and styles on regular basis. While, multinational sanitary ware producers such as Roca, Duravit, Kohler and Toto are notches ahead in terms of introducing new styles and designs, standalone sanitary ware producers too are putting huge efforts in matching their offerings with these producers. Many statistics from all around the world show that people love their bathrooms and that they love to spend time in them. Today, people spend around 40 minutes in bathrooms. The bathroom is no longer a necessity but a place of retreat in a stressful world. White, which has traditionally dominated the ceramic sanitary ware industry is getting tough competition from other colours. A number of consumers consider different colours to differentiate and add value to the bathroom. Modern lifestyle-bathrooms are more and more colorful and seem to end or at least reduce the long era of white dominance. Colors not only influence the planning but also the design of bathrooms. Bold use of colors in coming years will replace the minimalist understatement as a signal for elegance and design conscience. One of the most significant questions in front of designers and construction companies today is how to accommodate small-scale living without compromising luxury and style. The unprecedented increase in urbanization in the Asian countries and the limitations in housing size makes minimalistic designs one of the most preferred choice for sanitary ware products. Sanitary ware producers are putting emphasis to develop more intelligent, cross-linked and environmental regulations friendly products. The keywords are hygiene, water management and environmental compatibility. Sustainability and the protection of especially water resources is a big trending topic in the sanitary ware

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Analysis: Sanitaryware

me. . .

industry. There is no global manufacturer or designers in the industry that does not have a focus on these factors. According to India’s largest producer of sanitary ware producer, Hindustan Sanitary ware Industries Limited’s ( HSIL) management, “With the evolution of technology, everything has become more compact and user-friendly. Even people’s tastes and preferences have changed. There has been a significant growth in demand for the products designed with cutting-edge technology. The sanitary ware market in India has experienced the growth in demand for sleek and compact designs. This trend is particularly evident in demand for quality wash basins, bathtubs, jacuzzis, bidets, water cisterns, and pedestals. With the increase in demand, Indian sanitary ware producers have been challenged to come up with designs that match or blend with the thematic concept of the entire house. In recent times, manufacturers have been able to come up with products that offer highly efficient fittings and accessories. They also offer products that are easily installed, durable, and made with high quality materials.” HSIL is the second largest sanitary ware producer in India with an installed capacity of 4.2 million pieces of sanitary ware products from

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its two manufacturing locations in the country. According to Mumbai based architect Prem Nath, "In India, 'Lifestyle' goes on upgrading itself – open media & exposure to worldwide products has made India consumer-smarter and has upgraded the standards. Today with such wide variety of products available in sanitary ware industry, there is no limit on how much one could put-in amenities and/or cost.”

Major trends

With the rise in premium offerings by leading sanitary ware producers, it has been observed that Asian customers are increasingly demanding more premium and high-technology products for their bathrooms. This growth in demand is due to the increase in their spending power. As a result, the premium segment is growing more than the growth of sanitary ware industry. Asian consumers are now using bathrooms as a way to showcase their wealth and prestige. Bathrooms now are no longer just functional rooms but stylish too. Coming in contemporary designs and environmental-friendly, these technologically advanced products make style statements.

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Analysis: Sanitaryware

There used to be a time when sanitary ware was made with thick edges – so thick that you can place a glass at the edge of your bathtub and it won’t fall. Wash basins and toilets were made with thick edges which made them look bulky and take up a lot of space. Bulky sanitary ware is out and slim edged sanitary ware is in. Slim edged sanitary ware fits perfectly in minimalist designed bathrooms. As the name suggests the edges of these types of sanitary ware are very thin. The thin edge adds a feel of luxury and makes sanitary ware look dainty and delicate. Such sanitary ware also makes the bathroom look spacious and neat. People are now shifting from traditional closets to trendy wallmounted European closets and from pedestal basins to slimedged over-the-counter basins, which are more contemporary in design. The shift in trends is also because they are easier to maintain, use less water, with the current slim rim designs being more space efficient- aside from being more stylish too. Vinay Jain, CEO & President of Grafdoer, a New Delhi based retailer of sanitary ware products says, “ In metro cities like Delhi, we have observed that an increasing number of retail consumers are opting for sanitary ware products with water conservation technology. Since, washrooms are one of the major source of water usage, customers are moving towards eco-friendly sanitary ware that helps in water conservation. Currently, products like high-efficiency flushing system, and sensor taps have gained much popularity in commercial settings. However, in next few years, residential constructions are also expected to contribute significantly to the demand of these products.” India’s largest sanitary ware producer, Roca Parryware is focussing on water conservation, design, quality and sustainable technologies, as part of its global strategy to increase its footprint in India over the next three years. The company has an installed capacity of about 6 million pieces from its four production facilities in the country. Globally, the company has an installed capacity of more than 34 million pieces with production of 34.5 million pieces/ year and manufacturing plants in Europe, South America, North Africa and Asia. According to KE Ranganathan, MD, Roca India, “ We offer about 5 brands spanning across the different segments. We have a luxury brand known as Armani Roca which is a range of products designed by Giorgio Armani and Roca. It has been successfully running for the last 12 years and is the top most luxury range when it comes to bathroom interiors. It is like the Bentley of interiors. Then we have Laufen, it is a range from Switzerland. It is the world’s choicest brand in sanitary ware. It has the Swiss technology, design and efficiency all wrapped up in one brand.” Mr. Ranganathan further says, “The third brand that we have is Roca. This is a designer’s choice brand, wherein every range of Roca is designed by a top designer from across the world. The fourth brand we have is known as Parryware, it is the king of the market today in terms of market popularity. Parryware has always been a trendsetter. It is a brand that defines the bathroom space in India. The fifth brand we have is called Johnson Suisse. It caters to the affordable category and was acquired in 1996. We have always kept this brand in a very limited way but given the recent market demand for everything affordable we have rejuvenated it.”

Kajaria Bathware

India’s largest ceramic tile producer, Kajaria Ceramics, which entered the bathware segment with the brand Kerovit in 2014 by setting up a plant in Morbi is targeting upper and mid-segments of the sanitary ware industry.

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Super Cereme Location: Kenitra, Casablanca, Tetouan and Berrechid Country: Morocco Markets: Domestic and export markets Installed Capacity: 120,000 square meters of tiles per day Other: Largest ceramic tile producer in North Africa (ex-Egypt), Super Cereme is also the most advanced ceramic tile producer in the region. In addition to domestic Moroccan market, the company exports to a number of African countries. The company is a subsidiary of Yana Holding, one of the largest business entities in Morocco. In 2013, Super Cereme acquired its compatriot, Ceramica Ouadrass’s ceramic tile manufacturing business. The company is also contemplating setting up of its fifth manufacturing plant. It has not shared the timeline of this project, as the decision of this was to be based on just concluded anti: dumping probe.

Siam Sanitary Ware Industry Co Ltd (SCG group company) Location: Khokyae, A. Nongkae, Saraburi 18230, Thailand Products: Ceramic sanitarwares Markets: Domestic and export markets Others: Siam Sanitary Ware Industry produces sanitary wares under the COTTO brand name. The products include, bidets, urinals, lavatories, and other bathroom accessories. Offers bathroom design and installation.

American Standard Sanitaryware (LIXIL Thailand Public Company Ltd) Location: Mabkha, Nikompattana Sub District, Rayong 21180, Thailand Products: Ceramic sanitarwares Others: Full range of ceramic sanitarwares. American Standard is part of LIXIL Group of Japan

KOHLER (Thailand) Public Co Ltd and Karat Sanitaryware PCL Location: Tandieo, Kaeng Khoi, Saraburi, Thailand Products: Ceramic sanitarywares Markets: Domestic and export markets Others: KOHLER and Karat are leading vitreous sanitarware manufacturers. Thailand-based Karat became part of the KOHLER Company, and is now known as KOHLER (Thailand).

Star Sanitaryware Co Ltd Location: Nongkae, Saraburi 18140, Thailand Products: Ceramic sanitarwares Markets: Domestic and export markets Others: Star manufactures a wide range of products including vitreous china bathtubs, water closets, washbasins, urinals, bidets, squats, soap holders, etc.

Nahm Sanitaryware Co Ltd Location: Nongplamoe, Nongkae, Saraburi 18140, Thailand Products: Ceramic sanitarywares: Markets: Domestic and export markets Others: Manufactures full range of ceramic sanitarwares, such as, water closets, washbasins, urinals, bidets, bathtubs and other accessories. It is part of Villeroy & Boch of Germany.

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HITO TECHNICAL INDUSTRIES

HIGH DENSITY ALUMINA BALLS AND LINING BRICKS ALUMINA NANOBEADS ZH

HITO TECHNICAL INDUSTRIES, S.L.

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Analysis: Sanitaryware

Kajaria Bathware is a subsidiary of Kajaria Ceramics, which owns the Kerovit brand. Kajaria owns 85 per cent of the company and the remaining 15 per cent is with Aravali Investment Holdings, Mauritius. Recently, the company has expanded the installed capacity at its sanitary ware production facility in Morbi from 5.40 lakh pieces to 7.50 lakh pieces per annum. “Initially we started importing sanitary ware products from Vitra, a leading company in Turkey in 2011, and this continued for three years. Then we decided to set up our own manufacturing facility. With the changing tide of bath ware requirements, Kerovit is focussed on completely redefining the bathroom experience of Indian consumers. Our contemporary design and elegant aesthetic are suitable for modern living spaces. Kerovit received overwhelming response in the market. Jaquar Group, one of the top ten sanitary ware producers in India is stressing on higher quality and premium products in its offerings. The company had acquired Gujarat based sanitary ware production unit of Euro Sanitary ware in the year 2017. “Growing disposable incomes allows companies to consider multiple layers of segmentation beyond the traditional ones of rich, middle class and poor. Consumers are increasingly looking for products that are slightly better and sanitary ware producers realise they’re willing to pay a premium for them. We believe the bathroom is transforming itself from a functional space to a wellness space and consumers’ purchasing patterns are shifting in accordance with this,” says Sandeep Shukla, head- marketing, Jaquar Group.

Cera Sanitaryware

Cera Sanitary ware, which is among the top 3 players in the Indian sanitaryware industry has a stronghold over the mid and premium segments. The company has travelled uphill, grabbing market share from established brands like Hindware (HSIL) and Parryware. Focus on high product quality and innovative designs have seen the company achieving huge success in recent years. As of today, Cera controls 28% of India’s organised sanitary ware market, behind Roca Parryware and HSIL at 33% and 31%, respectively. According to Ayush Bagla, Executive Director at Cera Sanitary ware, “We are constantly upgrading our technology, increasing automation, upgrading consumer visible manufacturing processes via robotic glazing machines which help in evenness of glaze and also save glaze. The Company developed 3D printing machines allow designs to be prototypes in a manner of weeks, facilitating quicker time to market of new designs.”

TOTO

Japanese company TOTO is a leading producer of sanitary ware and is a name that has been synonymous with the advancement of bathroom culture since its creation in 1917. Its technological innovations and high standard of quality have made it an iconic and much-loved brand in Asian countries. In Asia, TOTO operates sanitary ware production plants in China, India, Indonesia, Taiwan, Thailand and Vietnam besides its home market, Japan. Globally, Toto group owns 14 plants Asia, USA and Mexico. In 2019, Indian subsidiary of Toto opened their first showroom in India, and the third in Asia at New Delhi. The showroom acts both as a showroom for general customers, and as a technical center for influencers and design professionals. Toto has displayed premium series like the Neorest which are focused on important projects like premium homes and luxury hotels. The Technology

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PEOPLE ARE SHIFTING FROM TRADITIONAL CLOSETS TO WALL-MOUNTED VERSIONS Cristina Sanitary (Thailand) Co Ltd Location: Huay Kwang, Bangkok 10320, Thailand Products: Ceramic sanitarwares Markets: Domestic and export markets Others: Manufacturer of full range of sanitarywares, with exclusive bathtubs and washbasins.

Mogen (Thailand) Co Ltd Location: Lumlukka, Pathumthani 12150, Thailand Products: Ceramic sanitarywares Markets: Domestic and export markets Others: Mogen manufactures and distributes sanitary wares made of vitreous China, such as, water closets, basins, bathtubs etc for both home and export markets.

Viglacera Corporation Established in 1974. Location: Hanoi, Vietnam. Products: Ceramic sanitarywares, tiles and heavy clay products. Annual production capacity: Three sanitary wares and fitting companies have a total annual production capacity of 1.3 million pieces. Markets: Domestic and export markets. Trademark/brand: As a trademark or brand, Viglacera is known worldwide as a major ceramic sanitaryware and tile producer of Asia.

Thanh Tri Viglacera Sanitaryware JS Company Location: Thanh Tri Ward, Hoang Mai Dist, Hanoi, Vietnam. Product: Full range of quality ceramic sanitaryware products under Viglacera brand. Markets: Domestic and export markets. The products compete with leading foreign company manufactured products at the domestic markets. The products also have export markets in Asia and other continents. A Viglacera Corporation unit.

www.asianceramics.com

Analysis: Sanitaryware

Display Zone, which is located in the basement of the showroom focuses on Toto’s offerings (like the Washlet) for public toilet spaces in airports, shopping malls and offices. The WASHLET™ is TOTO’s signature product. First launched in 1980, this innovation has revolutionised bathrooms across Japan for nearly three decades. The washlet has improved hygiene standards with its warm water cleansing system and through recent developments in air purification, automatic functions and more. In 2019, Toto Thailand commenced production from its second manufacturing plant in Saraburi. Toto invested Bt 2.8 billion in building this factory. Company’s new production facility focuses on manufacturing sanitary wares and also assembling washlet for supporting high-end market. With an installed capacity of 420,000 pieces per year, the new plant is located beside the first factory in Nong Khae, Saraburi. Spread over an area of 68,000 square meters, this facility is equipped with high pressure casting machines which make the casting process more stable than the conventional process. According to Takayasu Shimada, vice president of TOTO (Thailand), “We have a desire to revolutionise the sanitary world. Elegant design is harmoniously combined with intelligent functions and advanced innovations. TOTO group has recently released new Neorest series – luxury and smart toilet series – which is equipped with advanced technologies to provide users the greatest comfort.”

Building Materials Corporation No.1 (FICO) Location: Ho Chi Minh City (Factories of subsidiaries in different places). Vietnam. Products: Ceramic sanitary wares and other building materials. Markets: Domestic and export markets. FICO products are exported to many countries, including, USA, France, Russia, Australia, Korea, Singapore, Taiwan and Japan. Others: FICO is a state-owned company, belonging to the Ministry of Construction, and owner of many ceramic manufacturers, including, Thien Thanh Sanitarywares.

Thien Thanh Sanitaryware JS Company Location: Binh Chuan industrial zone, Thuan An district, Binh Duong, Vietnam. Annual production capacity: Over 700,000 pieces of ceramic sanitarywares. Products: Ceramic toilet suites, washbasins, urinals, bidets, etc, Markets: Domestic and export markets. Others: At Thien Thanh, sanitarwares are produced in a modern production line with technology and machinery imported from Italy, United Kingdom, Germany, and France.

INAX-Vietnam Sanitary Ware Co Ltd (VINAX) Status: Foreign investment Location: Gia Lam District, Hanoi, Vietnam Annual production capacity: 3,000,000 product pieces. Has seven factories. Three in Duong Xa, and four in Hung Yen. Products: Water closets, lavado, wash basins, urinals, bathtub, etc. Total investment: US$133 million. Markets: Domestic and export markets. Others: INAX Vietnam is a leading manufacturers of ceramic sanitarwares in Vietnam.

American Standard Vietnam Co Ltd Status: Foreign investment Location: An Phú, Thuận An, Bình Dương, near Ho Chi Minh City, Vietnam. Annual production capacity: 400,000 pieces of sanitarywares. Products: A wide range of ceramic sanitarywares and bathroom fixtures. Markets: Domestic and export markets. Major exporters to Middle East and Europe. Others: The products include exquisite luxury design to standard range models.

TOTO Vietnam Co Ltd Status: Foreign investment Location: Thang Long Industrial Park, Dong Anh Dist, Hanoi, Vietnam. Products: Full range of ceramic sanitarywares. Markets: Domestic and export markets

Hao Canh Sanitary Wares Co Ltd Location: Dong Co Commu, Tien Hai Ind. Park, Tien Hai, Thai Binh, Vietnam. Products: Ceramic sanitarywares. Annual Production capacity: Some 1.5 million pieces a year. Markets: Domestic and export markets. Others: Hao Canh Sanitary wares is one of the major producers of sanitarywares in Vietnam. Founded in 2001, it manufactures advanced ceramic sanitarywares, toilets, washbasins, urinals, etc, of international market standards.

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www.asianceramics.com

Stephan Schmidt KG for duravit High-performance ceramic. A material that meets many requirements. The production of ceramic is one of mankindâ&#x20AC;&#x2122;s oldest cultural techniques. Initially used to make dimensionallystable containers for storing food, clay, as a raw material, provided an excellent base for artistic design. Even after about 8.000 years, the potential of ceramic is far from exhausted in many application areas.

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ÂŠ Duravit AG

Analysis: Sanitaryware

Dong Tam Group

RAK Ceramics

UAE based RAK Ceramics has emerged as one of the most reputed ceramic sanitary ware producers in Asian region in last ten years on account of steady investments in capacity and capabilities. RAK operates sanitary ware production facilities in UAE, India and Bangladesh. Pioneering hi-tech innovations in the industry, RAK Ceramics has been able to corner a significant share in premium range of sanitary wares in the Asian and European region. From integrating the latest technological innovations like Touchless Flushing Systems that operate on sensor modules to watersaving mechanizations, RAK combines luxurious living with ethical sensibilities. Recently, the company unveiled collection of designer sanitary ware solutions under the brand RAK Cloud . RAK Cloud is a collaboration with the Italian designer Giuseppe Maurizio Scutella. Indian subsidiary of RAK Ceramics has recently opened a new Orientation Center in Gurugram. Spread over an area of 6000 square feets across two floors, the orientation centre is meant to make consumers aware of new designs and styles in ceramic sanitary ware and tile segments for the consumers of Gurugram, Manesar, Delhi and Noida. Globally, RAK Ceramics sanitary ware division achieved sales revenue of AED 497.4 million in the year 2018.

Kohler: a brand case study

For the US-based premium sanitaryware brand Kohler Co, India remains one of its three most strategic markets, despite the slowdown, said David Kohler, President and CEO, Kohler Co. Ïndia does have very strong, long term potential and it’s demonstrating that year-by-year with one of the highest GDP growth rates in the world. And the country is making progress. So to me this is a very different market than other markets in the world... So there’s a there’s a positive dynamic here,” David said in an interview with BusinessLine. Kohler India is planning to double its retail presence in the next three years, with a focus on the top cities. “We have a network of about 500 showrooms in the country today, and we’re interested in really continuing to rapidly expand that, in tier one and tier two cities,” David said. For Kohler, India is among one of the most interesting and creative markets it serves anywhere in the world, and the company is focussed on the long-term potential here. It launched its second Kohler Experience Centre (KEC) in the country in Mumbai on Friday, with plans to open one more in Bengaluru soon. The first KEC is in Delhi. With only around ten KECs globally, India will be the first to have three KECs, he said, emphasising the importance of the Indian market. KECs, unlike regular outlets, are not designed like display centres or showrooms, but are “inspiration zones” sprawled over 16,000 sq ft, meant more for customer engagement than sales. Kohler has also launched several new product categories in the country like grooming solutions inside bathrooms, water filtration and bathroom furniture and mirrors. When asked about the consumption slowdown in India, David said “We think, in kind of every major market or in India, there will be ups and downs and in a high growth market like this, you are going to have some volatility here and there and you’ll go through shorter term cycles, but that really doesn’t make a difference to us, because we’re focussed on the long-term.

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Location: Factories in Long An, Da Nang and Hai Duong, Vietnam Products: Ceramic sanitarywares, ceramic and porcelain tiles, and roofing tiles. Markets: Domestic and export markets. Others and Trademark/brand: Dong Tam is a leading and known trademark in Vietnamese ceramicwares since some half a century.

Vietnam Caesar Sanitary Wares Joint Stock Co Ltd Status: Foreign investment. Sanitar Co Ltd of Taiwan is the parent company. Location: Nhon Trach 1 Industrial Zone, Dong Nai Province, Vietnam. Products: Ceramic sanitarywares. Markets: Domestic and export markets. Others: Ceramic sanitaryware manufacturer Caesar Vietnam was established in 1996, as a fully owned Taiwanese company in Vietnam market for production (in several locations) and sale of quality ceramic sanitarywares.

KOHLER Vietnam Status: Foreign investment Location: Le Thanh Ton Street, District 1, Ho Chi Minh City, Vietnam. Products: Ceramic sanitarywares (‘Made-in-Vietnam’ KOHLER brand items). Markets: Domestic and export markets. Others: In addition to marketing of KOHLER brand sanitarywares produced in different KOHLER factories worldwide, KOHLER Vietnam also sources its world class KOHLER brand OEM products from the leading manufacturers in Vietnam.

P.T. Surya TOTO Indonesia Location: Tangerang, Indonesia Products: Ceramic sanitarywares Markets: Domestic and export markets Others: P.T. Surya TOTO Indonesia is TOTO’s first overseas factory. Its products include water closets, urinals, bathtubs, washbasins, bidets, sanitarywares with bathroom cabinets and fixtures, etc. The products are exported worldwide.

American Standard Indonesia PT Location: Cileungsi, Cibinong 16820, Jawa Barat, Indonesia Products: Ceramic sanitarywares Markets: Domestic and export markets Others: American Standard Indonesia PT is a major sanitaryware manufacturer in Indonesia to cater the domestic markets and for exports. A LIXIL Japan concern.

PT INAX International (INA Sanitaryware) Location: Semarang 50121, Indonesia Products: Ceramic sanitarywares Markets: Domestic and export markets Others: INAX is the leading Indonesia based ceramic sanitaryware manufacturer, founded decades ago. A LIXIL Japan concern.

PT Kohler Indonesia Location: Bekasi, Indonesia Products: Ceramic sanitarywares Markets: Domestic and export markets

Roca Indonesia Location: Cikupa, Tangerang, near Jakarta, Indonesia Products: Ceramic sanitarywares Markets: Domestic and export markets

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Analysis: Sanitaryware

Company’s sanitary ware revenue decreased by 1.7 percent year-on-year due to lower sales in UAE, KSA, Middle East and African markets.

Duravit India

Incorporated in 2006, Duravit India Private Limited is a wholly owned subsidiary of Duravit AG. The company was engaged in the trading and distribution of sanitary ware items manufactured by Duravit AG, however, it started manufacturing sanitary ware in the state of Gujarat in 2010. From this plant, the company caters to demand from Indian markets as well as other South Asian countries. The company has already made an impact in India as a premium designer bathroom brand with presence in more than 75 luxury hotels and over 150 premium residential apartments. The company is benefitting from the strong demand for design and lifestyle brands in India. The company develops unique and premium sanitary ware products in cooperation with high-profile international designers

Parryware: a brand case study

Kids don’t buy just toys these days. Apart from influencing the purchasing decision of parents, they also show a keen interest in buying sanitaryware. And companies such as Roca Bathroom are coming out with a series of sanitaryware products for this growing segment. The company, under its ‘KIDZ’ collection, has toilets and urinals for children. “Kids today decide the right product for them,” said KE Ranganathan, MD, Roca Bathroom Products Pvt Ltd, the Indian subsidiary of the €2-billion Spanish group Roca. The kids’ segment (7-15 years) has a huge potential, and it could contribute nearly 15 per cent of the total ₹3,000-crore sanitaryware segment, he said. The demand for kids’ products is from schools as well as malls, theatres and hotels. The company is planning to launch a Bluetooth-enabled shower soon to enable people carry their mobile phone to the bathroom to enjoy music, he said. New offerings On Parryware, the flagship brand in the Roca’s portfolio, Ranganathan said it has expanded its household plumbing offerings by adding cPVC (chlorinated polyvinyl chloride) pipes, which are used to connect water tanks to bathrooms in a concealed form. The company launched the product in Madurai in December followed by Thoothukudi, and today in Chennai. “Since the launch in Madurai, we have captured nearly 10 per cent of the market share there,” he said. Parryware manufactures cPVC pipes through a vendor based near Madurai. “In the next two years, we want to capture a 30 per cent share out of the total ₹200 crore cPVC pipes market in Tamil Nadu,” he said. After Tamil Nadu, the company will take the product to other southern states, and then to North India, he added. Adding cPVC to its portfolio helps the brand provide an integrated house-building experience. Parryware has also announced a new artistically designed bathroom collection — Artitude (Art+Attitude). The collection comprises the Night Life, Swish and Ovo series. The collection has introduced a new electronic range with features such as an automatic soap dispenser faucet, he said.

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MALAYSIA Johnson Suisse Sdn Bhd / ROCA Malaysia Location: Petaling Jaya, Selangor, Darul Ehsan, Malaysia. Products: Ceramic sanitarywares Markets: Domestic and export markets Others: Johnson Suisse has one of the leading ceramic sanitary ware factories in the region. It is recognized as the largest sanitary ware manufacturer in Malaysia, with leading brand name and market position.

Clay Industries Sdn Bhd (CISB) / Claytan Group (Sanitaryware manufacturer) Location: Kluang,Johor, Malaysia Products: Ceramic sanitarywares Markets: Domestic and export markets Others: CISB has a market niche with its own brands of ‘GLOBE’, ‘CLAYTAN’ and ‘LEGEND’ in Malaysian and export markets. CISB also manufactures and supplies OEM items for renowned international sanitaryware manufacturers.

Potex Industries Sdn Bhd Location: Masjid Tanah, Malacca, Malaysia Products: Ceramic sanitarwares Markets: Domestic and export markets Others: It manufactures full range of sanitarywares. It constantly improves products for the customers.

INNO Ceramitec Sdn Bhd Location: Ayer Hitam, Johor Darul Takzim, Malaysia Products: Ceramic sanitarywares Markets: Domestic and export markets Others: INNO produce vitreous china sanitary wares. It produces complete range of products to customers in low, middle and high end market.

Hocheng Philippines Corporation Locations: Dasmariñas, Cavite, Philippines Products: Ceramic sanitarywares Markets: Domestic markets

Royal Tern Ceramics Philippines Inc Location: General Trias, Cavite, Philippines Products: Ceramic sanitarywares Markets: Domestic markets

RAK Ceramics (Bangladesh) Ltd Location: Dhanua, Sreepur, Gazipur, Bangladesh Products:Ceramic sanitarywares Markets: Domestic and export markets

Charu Ceramic Industries Ltd (A unit of Great Wall Ceramic Industries Ltd) Location: Manikpur, Baghasura, Madhabpur, Habiganj, Bangladesh Products: Ceramic sanitarywares Markets: Domestic and export markets

Abul Khair Ceramic Ind Ltd Location: Baligaon, Kaligonj, Gazipur, Bangladesh Products: Ceramic sanitarywares Markets: Domestic and export markets

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Analysis: Sanitaryware

such as Philippe Starck, EOOS, Phoenix Design, Sieger Design, Kurt Merki Jr., Christian Werner, Matteo Thun and Cecilie Manz. “For Duravit, quality is a central success factor in order to ensure the satisfaction of consumers and architects. We developed the infrastructure and trained the people to meet Duravit’s high quality requirements,” says Asutosh Shah, Managing Director of Duravit India.

View from Thangadh

Thangadh, the sanitary ware capital of India accounts for a major proportion of sanitary ware production in India. Though, majority of the production from this town are meant for mass markets, but, sanitary ware producers in the town have started to adopt to the changes in consumer preferences. A number of established sanitary ware producers are increasingly producing high quality products with latest designs and trends. Investment in the state of the art technology in recent years has enabled these producers to offer sanitary ware products, which were offered by organised sanitary ware producers in the country till a few years back. Suresh Bhai Sompura , CEO of Thangadgh based Anchor Sanitary ware says, “ In recent years, there has been a sea change in consumers attitude towards the bathroom. Innovation is at the heart of our philosophy and we have continuously led the way in terms of product development, using a wide range of technologies at our products plants. Wall mounted fixings, thin Major sanitary ware producers : Turkey Company

Location

Number of Plants

Eczacibasi Vitra

Bilecik

5.0 million pieces

Kale Group

Semedeli

1.8 million pieces

Creavit

Zonguldak

4.0 million pieces

Akgun Group

Adapazari, Sakarya and Eskisehir

1.60 million pieces

Duravit Turkey

Istanbul

250,000 pieces

Searmiksan

Turgutlu

800,000 pieces

Alvit

Bartin

1.2 million pieces

Elit Mobilya Seramik

Eskisehir Organized Industry Area

400,000 pieces

Turan Seramik

Ordu

500,000 pieces

Turkuaz Seramik

Kayseri

3 million pieces

Viba Seramik

Eskisehir Industrial Zone

500,000 pieces

Idevit Seramik

Tuzla

700,000 pieces

800,000 pieces

( Sanvit )

Bozvit-Bozuyuk San. Ve Tic. A.Ş

Vitrifiye Bilecik

Installed Capacity/ annum

Gural Vit

Kuthaya

2.3 million pieces

Ege Vitrifiye Inc

Izmir

900,000 pieces

Saribaslar Seramik

Cerkezkoy Velikoy Industrial Zone

750,000 pieces

Bocchi

Kocaeli

400,000 pieces

Dogvit Seramik

Maltepe

400,000 pieces

ECE Banyo

Corum Industrial Park, Corum

1.5 million pieces

Eskisehir Seramik ( Lapino)

Eskisehir

400,000 pieces

Sanovit

Eskisehir

350,000 pieces

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Star Ceramics Ltd Location: Riaznagar, Baghasura, Madhabpur, Habiganj, Bangladesh Products: Ceramic sanitarywares Markets: Domestic and export markets

Bangladesh Insulator & Sanitaryware Factory Ltd Location: Mirpur, Dhaka, Bangladesh Products: Ceramic sanitarywares Markets: Domestic and export markets

OAO Zavod Universal Location: 654 032 Novokuznezk, Kemerovo Oblast, Siberian Federal District, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: OAO Zavod Universal is the only major ceramic sanitaryware manufacturer in the Siberian region of Russia, and has a production capacity of about 38,000 tons a year. It manufactures a wide range of products. In addition to ceramic sanitarywares, Universal manufactures metal sanitarywares and various other building materials, which are marketed all over Russia. However, its ceramic sanitarywares are distributed mainly in all three Russian North Asian federal districts of Ural, Siberian, and Russian Far East. Universal also exports to other countries.

Kirovskay Keramika (Kirov Ceramics JSC) Location: Kirov, Kaluga region, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Popular Rosa and Kirovit brand producer Kirov Ceramics is one of Russia’s leading sanitaryware manufacturers. Produces about 2 million units of sanitarywars a year or some 17 percent of Russian production. It claims increase of its production by 5-8 percent every year. Equipped with Italian and German machinery. It supplies to all region of Russia and have large distribution facilities in North Asia. It exports to CIS countries and Western Europe.

Roca Location: Tosno, Tosnensky District, Leningrad Oblast, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Roca has seven plants in Russia. It offers complete range of sanitarywares. Markets Roca, Laufen, Jika, Santek, Santeri, Aquaton brands.

Santek Location: Cheboksary and Novocheboksarsk, Chuvash Republic, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Santek is a part of Roca Group and producer of bathroom solutions, such as, floor standing and wall-hung water closets, washbasins with pedestals, urinals, and bidets.

Santeri (CJSC Ugrakeram) Location: Vorotynsk, Kaluga Region, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Santeri is a producer of the wide range of sanitarywares. The company is a part of the Roca Group. Its production capacity is 2.5 million pieces of sanitarywares a year.

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Analysis: Sanitaryware

edges and smooth shapes are the current trend for sanitaryware, along with well-designed and affordable rimless WCs with water saving technology and hidden fixtures. We have been working on new solutions for a hidden fixture system and have developed a new and very innovative fixing system, to make fixation easier and safer.” Dushyant Sompura, General Manager at Thangadh based Ariston Ceramics, a leading sanitary ware producer says, “About a decade back, majority of the sanitary ware products in India were largely bought for functionally. However, market situation

has changed dramatically during the last ten years. Currently, for a vast section of population in tier – 1 and 2 cities, sanitary wares have moved on from being just used in a bathroom for hygiene to a more aesthetically led decor item. Attractive designs have become extremely important part of the industry. Consumption habits are changing rapidly and the appetite for trying out new brands and designs is higher than ever before. A recent market research on purchasing behaviour in sanitary ware industry suggests that an average retail consumer purchases from 7 different sales points.”

Eczacıbaşı VitrA Location: Serpukhov, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: VitrA’s Serpukhov sanitaryware plant, located in Serpukhov, about 100 km from Moscow, has an annual capacity of 250,000 large pieces. VitrA branded products are available at 1000 sales point around Russia.

Cersanit Location: Krasnystaw and Syzran, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Cersanit is a major manufacturer of sanitarywares. Its plant is equipped with machinery supplied from Italian SACMI and others.

Sanitec (Geberit) Location: Moscow, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Markets Geberit, Keramag, Ifö and Ido brands.

Sanita Luxe Location: Samara, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Sanita Luxe’s collections include, Infinity, Ringo, Art, Flora, Best, Next, Classic, Attic, etc. The company also manufactures and sells components for the entire line of its products.

Della Location: Noginsk city, Moscow region, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Della is a Russian brand of quality porcelain sanitarywares.

Oskolskaya Keramika (Oskol Ceramics) Location: Belcityskaya area, Starij Oskol, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: Oskol is a Russian brand and manufacturer of compact and standard sanitarywares.

St. Petersburg Sanitaryware Location: St. Petersburg, Russia Products: Ceramic sanitarywares Markets: Russian domestic and export markets Others: St. Petersburg is a Russian brand sanitaryware manufacturers.

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Analysis: Iran

F e e lin g th e domestic slowdown hits Iranian tiles AC looks at how the constant pressure being applied to the Iranian economy are essentially stifling the immense potential of the country’s advanced, and highly capable, ceramic tile industry…

ogging the international limelight for most of the January for political reasons, Iran is undergoing one of the most turbulent phases of its modern history. A record contraction of economy in the year 2019, high inflation and moribund construction sector has had a very negative impact on the country’s ceramic tile manufacturing industry. Despite that, according to provisional figures a total of 158.45 million square meters of ceramic tiles were produced in Iran during the first five months of the current Iranian year (March 21, 2019Aug. 22, 2019) to register an increase of 4.4% compared with last year’s corresponding period. However, during the last seven months of the financial year, the output is expected to fall below that of the last year. In 2018, Iran produced a total of 343 million square meters of ceramic tiles. The country had an installed capacity of 680 million square meters at the end of the year 2018. Capacity utilisation of country’s ceramic tile industry for the year at 50. 44 % was at one of the lowest levels in recent years. Production of ceramic tiles in the last four years ( 2015- 2018) has been unable to match the high water mark figure of 496 million square meters registered in the year 2014. Though, in comparison to the year 2017, ceramic tile production registered a sharp upturn of about 12 %, but domestic consumption did not increase in the same proportion and a large part of total increased output had to be exported. A number of factors makes Iran one of the most important producers of ceramic tiles in the region. Availability of key raw materials for ceramic tile production, cheap resources

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of energy, especially the natural gas, cheap and skilful manpower and scale of operations of a number of producers, of which approximately 90 percent are equipped with state of the art technology and machinery. Nearly 70 % of these production units have come up in last 12 years, which means that most of these units are equipped with latest technologies. All the above mentioned factors make Iran one of the most important ceramic tile producer on the global scale. Ceramic tile consumption growth in the domestic market is expected to register negative figures in 2020 and 2021 as forecast by World Bank and UN are painting a grim picture of Iranian economy for the current and coming year. The United Nations forecasts Iran's economy to shrink by 2.7% and 1.2% in 2020 and 2021 respectively. In its latest publication, "World Economic Situation and Prospects 2020", the UN estimated the country's GDP to have contracted by 7.1% in 2019 after a 2% contraction in the year before. "Serious flooding, the reintroduction of sanctions by the United States and increasing tensions with Saudi Arabia have hit the economy hard, sending the country’s exports into a nosedive. Investment and private consumption growth have decelerated ... While the government has already increased spending to address challenges created by the economic recession, it will take several years for economic growth to return to positive territory. The country’s critical lack of economic diversification will continue to cloud its economic outlook," the UN publication reads. A key stakeholder from Iranian Ceramic Tile and Sanitary ware Producers’ Syndicate told AC

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Analysis: Iran

e pressure Leading Iranian tile producers on the condition of anonymity, “ A number of new ceramic tile producers are expected to begin production in the Yazd province in the first half of 2020. More than half of all Iranian ceramic companies are planning major investment programmes to modernise their production lines. Their goal is not only to expand capacity but also to improve the quality of their product mix, which will require the most advanced technologies and involve significant investments. All of this is part of a broader programme aimed at increasing production capacity from the current levels to 1,000 million square meters per year by 2025, with projects that have already obtained the necessary permits from central authorities and are also open to the participation of foreign investors.” However, everybody is not sanguine about the propsects of Iranian ceramic tile industry, at least in the short term. According to Apadana Ceram’s Dr. Nader Salamat, “Most ceramic tile manufacturers are currently experiencing severe problems. Domestic ceramic tile industry is facing an acute shortage of raw materials, packaging problems, increased shipping rates and restrictions on payment from export orders. Lobour and fuel costs have been on a continual rise for last two years. And face wages and administrative and current costs. A number of factories are closed temporarily and an equal number of producers are finding it very difficult to continue in the challenging times.”

Yazd consolidates

Province of Yazd has played a key role in the growth of Iranian ceramic tile industry. The province houses more than half of the total ceramic tile units in the country. Most of the recent investments in new ceramic tile manufacturing units in the country have come up in this province. According to Nasrollah Sharif-Fard, Deputy Head of Iran’s Tiles and Ceramics Association, “Province of Yazd has played an important role in Iranian ceramic tile industry. There are 76 ceramic production units in Yazd. Ceramic industry has created jobs for about 300,000 people from the province’s 1.138 million population. Iran’s tile industry enjoys cheap and abundant energy and raw materials combined with indigenous expertise rooted in history. However, due to the market recession caused by an ongoing stagnation in the construction sector as well as the tile and ceramic industry’s overproduction due to the unrestrained issuance of factory licenses during the 1990s, production has been on a down-trend over the past few years.”

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Company

Location

Installed Capacity

Pars Tile

Qazvin Industrial City

6 million sqm / annum

Niloofar Tile Industries Sanati Birjand Company

7 million sqm / annum

Hafez Tile Company

Zarghan

8 million sqm / annum

Khatam Ardakan Tile

Ardakan Industrial Zone 3.5 million sqm/ annum

Kashi Kashan

Kashan

4 million sqm/ annum

Tak Ceram

Tehran

3.5 million sqm/ annum

Behceram Tile Company

Kashan

5 million sqm / annum

Irana Tile Company

Tehran

12 million sqm / annum

Kasra Tile Company

Tehran

4 million sqm / annum

Apadana Ceram

Gazvin

30 million sqm / annum

Tima Tile Company

Khorasan

2.5 million sqm / annum

Marzan Tile Company

Ishfahan

3.0 million sqm / annum

Perseopolis Tile

Mehriz

14 million sqm / annum

Sina Tile Company

Kaveh Industrial City, Saveh

8.5 million sqm / annum

Aghigh Tile Group

Yazd

4 million sqm/ annum

Orchin Tile Company

Meybod

4.5 million sqm / annum

Meybod Sadra Ceram Tile Company

Jahanabad Industrial Area, Meybod

6 million sqm/ annum

EEFA Ceramic Company

Yazd

6 million sqm/ annum

Bastan Tile Company

Yazd

4 million sqm/ annum

Khazar Tile Company

Rasht

5 million sqm/ annum

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Analysis: Iran

Table 1 2010 2011 2012 2013 2014 2015 2016 2017 2018

438 482 506 540 561 590 612 630 680

An export focus

Limited and stagnating demand in the domestic market forced Iranian ceramic tile producers to look for export markets during the early part of the last decade. Fluctuating demand in domestic market during the mid of last decade and huge capacity addition in domestic industry prompted these players to dedicate a large proportion of total output for export markets. According to the Head of the Iranian Ceramic-Tile Producers Syndicate (IRCPS) Mohammad Roshanfekr , country’s ceramic and tile exports in the Iranian calendar year of 1397 (ended on March 20, 2019) increased by 10 percent compared to its preceding year. “The ceramic and tile exports stood at 121 million square meters in (Iranian calendar year of ) 1396. However, country’s tile and ceramics industry is working at only 40 percent of its full capacity and that many companies are on the verge of bankruptcy due to their inability to pay off bank loans. Despite western sanctions imposed on Iran during the past few years, tile and ceramics manufacturers have made attempts in order to retain their export market,” according to Mohammad Roshanfekr. Iraq, Afghanistan, Pakistan, Turkmenistan, Georgia, the UAE, Tajikistan, Armenia, Uzbekistan and Azerbaijan are the key export markets for Iranian ceramic tile producers. However, during last three years, Iranian ceramic tile producers have started to export ceramic tiles to other Asian and African countries along with the countries mentioned above.

Installed capacity (m. sq metres)

Table 1 2010 2011 2012 2013 2014 2015 2016 2017 2018

Table 1 2010 78 2011 86 2012 94 2013 102 2014 110 2015 117 2016 121 2017 133 2018 139

78 86 94 102 110 117 121 133 139

Number of tile producers (companies) Number of tile producers (companies)

Table 1 2010 2011 2012 2013 2014 2015 2016 2017

365 410 444 468 496 346 290 307

Tile production (m. sq metres)

New demand drivers

Iranian government has taken a number of initiatives in recent months, which are expected to give an impetus to ceramic tile demand in domestic and export markets in the current and coming years. Iranian Roads and Urban Development Ministry has announced plans to build 400,000 homes over two years. Registration for the government-sponsored scheme began in November 2019 in 10 provinces. Construction of 180,000 residential units has already begun and the ministry is conducting province-by-province registration of eligible applicants. Having been piloted in Kerman Province to find out if the registration process was smooth, the initial registration phase has been launched in Qom, Hamedan, Sistan-Baluchestan, Ardabil and Zanjan provinces of the country. Iran’s trade agreement with Eurasian Economic Union ( EEU) is expected to give Iranian ceramic tile producers access to

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Analysis: Iran

Table 1 2010 2011 2012 2013 2014 2015 2016 2017

some of the key ceramic tile importing markets in the region. Iran's preferential agreement with the /EEU took effect on Oct. 27, 2019. The Eurasian Economic Union includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia.Â Though, there remain another two years of negotiations to increase the scope of the FTA in terms of specific products to be traded between Iran and the EAEU. Iran is currently under heavy sanctions from the United States and has been blocked from the global SWIFT network, making payments for oil products difficult. It has instead been trading with countries like China and Russia in gold, and also plans to launch a resource backed crypto currency to mitigate against US dollar trade.

318 340 355 370 392 219 202 205

Domestic consumption (m. sq metres)

Table 1 2010 2011 2012 2013 2014 2015 2016 2017

61 82 96 110 118 132 106 117

Tile exports (m. sq metres)

Overcapacity

There is no doubt that Iranian ceramic tile industry has registered one of the highest growths in global ceramic tile manufacturing industry during the last few years. Over the period of last twenty years ( 1999-2019) the number of ceramic tile producers have increased from 19 to 139 and installed capacity has grown by more than six folds since 1999 to reach an estimated 710 million square meters at the end of 2019. However, this swift capacity addition has created a serious overcapacity in the domestic market. An installed capacity of nearly 700 million square meters for a country with a population of just 82 million translates into a per capita installed capacity of 8.5 square meters, which is among the highest in the world. So, it would be an understatement to say that Iranian ceramic tile industry has been badly affected by the severe overcapacity for last few years. Most of the ceramic tile producers blame controversial state-owned Mehr Housing Plan for the overcapacity. Mehr Housing Plan, which was initiated in 2007 by the previous administration with the aim of providing homes to two million low-income households through free land and cheap credit. The plan, however, slowed down due to the lack of funding, which dragged down domestic demand for construction materials. When the domestic market slumped, producers turned to exports.Â Intervening period between the two economic sanctions also prompted a number of new producers to venture into ceramic tile production. During these years, a number of existing producers too increased their installed capacity in anticipation of growth from domestic market and export opportunities. These capacity expansions started to create a situation of overcapacity. Overcapacity also had an impact on the selling price in domestic and export markets as most of the producers have been struggling to keep their production facilities running.

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Table 1 2012 2013 2014 2015 2016 2017 2018

377 455.5 442.6 421.4 288 332.2 387.2

Tile exports (US$m.)

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and economic benefits. The digital glazing feature applies the right amount of glaze in a controlled manner, reducing the amount of waste that is typical in tile manufacturing. The EFI Cretaprint glaze formulation also has lower vapour emissions and requires less water consumption. Users can apply the glaze with superior accuracy, an essential factor in the production of largersize tiles. The EFI Fiery® proServer digital front end for Cretaprint, a dedicated colour management solution for digital ceramic tile decoration, features innovative ColorWise® separation technology for ceramics. ColorWise uses purpose-built colour management algorithms for sharper, more detailed output versus conventional ICC colour management methods. Combined with EFI Cretacolor Inks, ColorWise separation technology reduces ink usage by up to 30% versus traditional ICC colour management without affecting accuracy, gamut or definition. Plus, a Smart Ink Savings feature for the Fiery proServer can reduce ink costs further by calculating the most affordable ink combination possible needed to produce a design. These combined technologies can deliver a total ink cost savings of up to 40% versus other tile production methods. The EFI exhibit at Cevisama is in hall N2P7, stand B29 at Feria Valencia. For more information about EFI products for ceramic decoration, visit www.efi.com/cretaprint.

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Analysis: Iran

Apadana Ceram

Apadana Ceram is one of the biggest and leading ceramic tile producing companies in Iran. The company created a stir in the domestic and regional market in 2007, when it opened with an installed capacity of 30 million square meters of ceramic tiles per annum. The company produces 3 main types of tiles: glazed porcelain tiles, unglazed porcelain tile and glazed wall tile. To be able to produce digitally printed tiles of all kinds of products, Apadana Ceram has always adopted state of the art technology. The company has a state of the art digital decorating equipments with monthly production of 90,000 square meters with printing width up-to 700 mm.

MOST CERAMIC TILE MAKERS ARE EXPERIENCING SEVERE PROBLEMS

Table 1

Roka Ceram

Roka Ceram, a new start up in ceramic tile industry commenced commercial production in March 2019. Located in the industrial area of Yazd, company’s production plant is spread over an area of 20 hectare with a covered area of around 40,000 square meters . The company produces 10,000 square meters of tiles per day, mostly in 60x60 cm and 80x80 cm sizes. The company intends to double the production capacity in coming years. Roka Ceram is part of the Khojasteh Industrial & Trading Group, which operates in a range of sectors including packaging, food, cosmetics and pharmaceuticals.

2012 2013 2014 2015 2016 2017 2018

16.4 3.2 9.4 8.9 2.9 4 3.2

Tile imports (US$m.)

Sina Tile Company

Located in Tehran, Sina Tile is one of the largest ceramic tile producers. The company has transformed itself with state of the art technologies, producing digital ceramic tiles in almost all the dimensions. Tracing its history to 1986, the company has two established brands (Sina and Sorena) and is among selected few companies to have a double digit (more than 10 million square meters/annum) capacity from its two plants in the country. Installed capacity of Sina brand is seven million square meters (wall and floor), while for Sorena brand the capacity is four million square meters.

Rock Sanat

In August 2019, ceramic tile producer Rock Sanat also known as MA Ceram commenced commercial production of large porcelain tiles in the sizes up to 1600 mm X 3200 mm in thicknesses up to 25 mm. The company has also acquired entire raw materials preparation plant, equipped with latest-generation continuous modular mills to ensure the maximum stability and efficiency of production.

Table 1 2012 2013 2014 2015 2016 2017 2018

5.5 1.3 3.5 3.2 0.7 1.7 1.1

Tile imports (m. sq metres)

Amin Tile

Located in the hub of Iranian ceramic tile industry at Yazd, Amin Tile commenced commercial production in early 2017 with an installed capacity of 8 million square meters of ceramic tiles. Set up by a group of local entrepreneurs: with an aim to produce high end ceramic tiles to compete in the international market Amin Tile plant is equipped with best in class technology to produce high quality ceramic tile products.

Persepolis Tile & Stone Group

Persepolis Tile & Stone Group has emerged as one of the prominent producers of digitally printed ceramic tiles. Located on the freeway of Yazd-Bandar Abbas, in the city of Mehriz, Iran, the company which commenced commercial production in the year 2007 was set up in two phases. The first phase, which involved a

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Analysis: Iran

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production capacity of two million square meters of terrazzo tiles was followed by a twelve million square meters production facility in the following year. The company has been awarded as one of the exemplary exporters from the country by the export promotion department of Iranian ministry. Persepolis Tiles & Stone Group has made great strides in the production of digitally printed tiles. The company has heavily invested in digital capability over the last few years.

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RAK Ceramics Iran

Financed by the World Bank, RAK Ceramics set up Iran operations in 2003, with a USD 40 million investment. The plant remained running even as sanctions tightened and the Iranian economy floundered. The facility now has 3 production lines and an annual production capacity of 12 million square meters. In 2015, the company acquired 20 % minority stake in the venture and made the venture a 100 % subsidiary of RAK Ceramics. According to the management of RAK Ceramics, “ The performance of our Iranian entity has improved despite several macro-economic challenges such as reinstatement of US sanctions and the continued depreciation of the Iranian rial. We increased our production capacity by launching our second production line, and were able to lower production costs and enhance product quality. Furthermore, we have developed and produced a new high-end series to differentiate ourselves against local manufacturers. We continued to build up our market presence by opening a second showroom in Tehran and adding more dealers to our network.”

Meybod Tile

Founded in Meybod town in the 1980s during the Iran-Iraq war, Meybod Tile was the first private firm in Iran to produce single-fire floor tiles. On the back of brisk demand, the company expanded its installed capacity in recent years. The company, which has an installed capacity of about 6 million square meters per year has added digitally printed tiles in its portfolio in order to meet the rising demand of these products in domestic and export markets.

Khazar Tile

Khazar Tile has been one of the leading ceramic tile producers in the country for more than two decades. Initially the company was into the production of wall tiles but later it diversified into the floor segment. Located in northern Iran near the city of Rasht, the floor tile plant, which become operational in early 2013 can produce over 5 million m2/year of high quality floor tiles, thus allowing Khazar Tile to provide its customers with a comprehensive range of both wall and floor tiles.

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Analysis: Heavy clay

Driving ch automation in Asian brick Jahir Ahmed looks at the impact of increasing levels of automation across Asia’s clay brick industries, and asks what it would take for the trend to become even more widespread in the next decade…

sian brick manufacturing has largely improved by introducing automation in production and eliminating traditional kilns greatly, but, non-fired bricks are grabbing the market shares speedily, mostly due to environmental and cost efficiency reasons. Among the regional countries, Vietnam is in most advanced stage of the development. However, India is still depending on fired bricks by improving its production technology and switching to automation. The production of clay bricks in Asia is now being upgraded to machine-made production and other energy-efficient technologies by replacing old traditional kiln firing systems, supported by the governments and the technology transfers through UN agencies including UNDP. A significant quantity of productions is already upgraded to the high-quality ceramic grade, opening up opportunities for new investment in plant and machinery. However, investment in automation of fired bricks remained continued with competitive advantages, when it comes to environmental benefits and cost efficiency. In a latest brick automation development in India, Austria’s Vienna based multinational company Wieneberger AG, a global player in the construction sector, is investing more, another US$4.2 million in its Kunigal factory in South India. The first automated ‘Porotherm’ (perforated clay bricks) manufacturing unit in Kunigal went into operation in 2009. The fully automated production facility at Kunigal, 70 kms from Bangalore, is Wienerberger’s first Asian manufacturing unit. The unit runs 365 days a year, producing 75,000 bricks or 450 tonnes of bricks per day, facilitating quick supply of bulk orders. Quality is ensured by the latest European production equipments. It has 24hour factory production control in-house laboratory for chemical and physical tests of raw materials and finished productions. Thousands of projects across Karnataka, Tamil Nadu, Andhra Pradesh and Kerela have employed Porotherm walling solutions since 2009. With the pressing need for environmentally responsible constructions, the figures are ever increasing.

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Since each of the Porotherm brick equals in size nine standardsized bricks (produced in conventional Indian kilns), volume wise the daily production amounts to around 0.6 million bricks. While visiting the factory recently, Christof Domenig, CEO, Wienerberger Building Solutions, said the new investment will enable the company to support its expansion plans including upgradation of equipment in the factory, switching over to natural gas as a fuel and launch of new building solutions that will facilitate faster construction with lesser resource consumption. Wienerberger India’s Managing Director Monnanda Appaiah said the fresh investment is expected to enable the unit to further cut down the CO2 emission by 40 percent even while enhancing the capacity by 25 percent. He said the unit sources the clay from 20 dead water bodies from the surrounding areas, thereby recharging them through desilting. The unit uses natural additives such as granite waste, saw dust, rice husk and coal ash as inputs, incorporating sustainable practices in manufacturing. “The company supplies Dryfix System, a specially formulated adhesive for bonding the bricks, thereby replacing sand and water. The system accelerates speed of construction as it requires no curing,” said Appaiah. He said Porotherm bricks produced at the factory weigh 60 percent less than the conventional walling material, provide thermal and sound insulation and each brick carries the date of manufacturing and meets all specifications for structural strength under the Indian National Building Code. The Kunigal brick factory is most is based mainly on renewable energy. It uses robots for ‘pick and place’ operations and the entire process from feeding of raw material till the rolling out of fired bricks (for stacking) requires around 18 hours. According to Plant Manager D.J. Jagadeesha, the 30,000 units of power consumed at the unit daily, 95 percent comes from solar energy. Wienerberger India claims the wall made with Porotherm ‘smart bricks’ provide the house owner with a lifetime opportunity of experiencing comfortable living environment in all seasons. The perforated design of the brick ensures excellent thermal insulation that keeps indoor temperatures cool at all times. The best thing about the blocks is that they are made entirely of clay making

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hange

Porotherm a natural walling material, rated by the Green Building Council if India. The large size of the blocks promotes savings in mortar consumption since one Porotherm 8" block is equivalent in area to 9 small bricks. Another spectacular feature of Porotherm is the precision in design. The blocks are highly dimensionally tolerant making Porotherm a one of a kind wall solution in the market. The company said, as the Porotherm blocks are 60 percent light in weight than any other conventional walling blocks, it aids in faster construction. Apart from all these, Porotherm blocks also have the lowest water absorption because of which the possibility of superficial or shrinkage cracks on plaster are none, it further claims.

Auto-production

In the ASEAN region, the machine-made bricks are produced mainly in Indonesia, Malaysia, Philippines, Thailand and Vietnam, with few in other countries. Now the Chinese small plants, with multiple fuel options, attracted many SMEs (small and medium enterprises) in the region, mostly in Cambodia, where several dozens of the brick plants are installed at a small investment of US$30,000 to US$1m. Vietnamese brick making machineries are also entering Cambodia following a rapid increase in consumption of building bricks. Countless traditional brick manufacturing kilns, including some machine-made factories, are operating in the smaller producing countries of Cambodia, Laos and Myanmar, and in few number in Brunei, where traditional bricks are the main supply sources for

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Analysis: Heavy clay

THAI HEAVY CLAY IS GRADUALLY LOSING ITS ADVANTAGE OVER CONCRETE construction of houses, buildings and other infrastructures since centuries. Low cost auto-kiln soil-brick machines are now changing their brick production traditions very rapidly. The cheaper technologies supplied from many Chinese machinery manufacturers produce clay bricks efficiently and economically, compared to the manual methods, even without going through technology transfer or replication of various types of brick kilns, said the brick manufacturers in Cambodia.

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Analysis: Heavy clay

Without drying, the clay bricks are grabbed by the robot hand automatically onto the tunnel kiln car, and enter into the tunnel kiln for firing and then shipped by kiln car out of the kiln, for stacking. The core part of production line is the vacuum brick making machine that makes solid and perforated clay bricks by using different moulds. This type of machine, for instance, of Wangda Machinery, based in Henan Province of ns China, has a daily output of 100,000 to 200,000 bricks. Transfer of the Chinese Vertical Shaft Brick Kiln (VSBK) technology for brick production in low income countries has now spread almost all over Asia to reduce pollution of brick kilns and keep production cost at comparatively low level.

Losing ground

In contrast to higher demand in Vietnam, the Thai heavy clay market is gradually losing its advantage over concrete products. The concrete building blocks and roofing tiles continues to pose a serious threat to the kiln-burnt clay products which are struggling hard to survive following increasing production cost due to rising fuel costs and negative impacts of burning the fossil fuels on the environment. Due to restriction on manufacturing in polluting clay brick factories in Thailand and want of a viable low-capital alternative and replacement of using firewood all over the country, the production of clay bricks and improvement of its technology remains almost stagnant, on the other hand, the concrete product manufacturing it rising. Taking the situation in their advantage, the manufacturers of concrete building blocks of all types are expanding capacity since past few years. Many new companies are investing in concrete projects and the leading manufacturer in the concrete sector, SCG Building Materials, are looking for larger production in the coming years. In Thailand, most of the building blocks are being supplied by the manufacturers of light cement concrete blocks, according to the industry sources. This indicates limited business by the clay block and brick manufacturers. Leading clay brick industry, Chiang Mai based Paradorn Bricks Co, said it still has its supply to all over the country, including major growth centres, but few new investors or existing manufacturers in Thai heavy clay sector are showing interest in new projects, when they have better prospects in concrete blocks. In its own words Paradorn admits the country’s leading clay brick manufacturing region in Chiang Mai and other neighbouring provinces in northern Thailand is continuously experiencing a decline since past several years. “In these days,” said the company, “the number of brick factories located within the areas has decreased enormously.” The company manufactures and distributes bricks which are certified by the ISO 153-2540. Its products include Lanna facing bricks, common bricks, texture bricks, paving & decorative Lanna bricks, Lanna glazed tiles, semi-handmade Lanna clay roof, handmade cement roof and laterite, fire-resistant bricks, granite tiles and made to order bricks. The company’s products have been used at various architectural sites including arts and cultural buildings, houses, ancient sites and objects, resorts, spa outlets and natural tourist attractions. The products have characterized the identity of Lanna, a nationally popular brand, to those places. The manufacturer said, bricks give emotional value as to their Lanna-characterized designs, simplicity, environmental friendliness, reliable quality and inspirational feature, and offer exceptional functional value. Its market promotion was backed by Thailand’s Industrial Promotion Department, Ministry of Industry, and National Science and Technology Institute.

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Malaysia’s Johor-based Brick Manufacturers’ Association members: Brick Dotcom (Johor) Sdn Bhd (BDC) (principal company Brick Dotcom Sdn Bhd has 1 plant in Selangor)

Kangkar Raya Batu Bata Sdn Bhd Oriental Brickworks Sdn Bhd Yong Peng Batu Bata Berhad Hoe Guan Brickworks Sdn Bhd Gian Shing Kilang Batu Bata Sdn Bhd Deluxe Brickworks Sdn Bhd Maybricks Sdn Bhd Ji Sheng Bricks Sdn Bhd Sykt Kia Lim Kilang Batu Bata Sdn Bhd Batu Bata Kah Wee Sdn Bhd Sykt Hanura Batu Bata Sdn Bhd Nam Mah Brick-Maker Sdn Bhd Great Wall Brickworks (M) Sdn Bhd Claybricks & Tiles Sdn Bhd Seng Lee Brickworks (M) Sdn Bhd Kilang Batu Bata Hupe Soon Sdn Bhd Bukit Batu Brickmills Sdn Bhd

Selangor-based Brick Manufacturers’ Association members: Brick Dotcom Sdn Bhd (BDC) (subsidiary company Brick Dotcom (Johor) Sdn Bhd has 2 plants in Johor)

Cheras Brickworks Sdn Bhd Kilang Batu Bata Hap Kee Sdn Bhd Qiristar Bricks Contrator Sdn Bhd Sentosa Brickworks Sdn Bhd Yap Khay Cheong Brick Works (Batang Kali) Sdn Bhd Original Clay Industries Sdn Bhd Kilang Batu Bata KYH Sdn Bhd Brick Dotcom Sdn Bhd Thai Huat Brickworks Sdn Bhd Sin Heap Fatt Brickworks Sdn Bhd Galian Bricks Industries Sdn Bhd LDV Batubata Kerling Sdn Bhd Selendang Delima Bricks Manufacturer Sdn Bhd Wira Bricks Sdn Bhd Yap Teck Heng & Sons Bricks Industry (M) Sdn Bhd Kimtee Brickworks Industry Sdn Bhd Parksim Bricks Sdn Bhd Deluxe Brickworks Sdn Bhd Malaysian Red Bricks Factory Sdn Bhd

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Analysis: Heavy clay

Resource efficient

The Asian governments’ ministries of environment, forest and climate change in partnership with UNDP have initiated project to promote the production of resource efficient heavy clay products, such as, high quality building blocks and perforated bricks, hollow blocks, facing bricks, paving, roofing tiles, clay pipes, fly-ash bricks, and other building materials. However, in the current high cost of natural gas and petroleum products the Indonesian and Philippines clay brick markets are experiencing stiff competition from the concrete blocks. In many other markets of ASEAN, specially, Brunei, Malaysia, Singapore and Thailand, where concrete blocks are aggressively grabbing the market shares for its advantages over clay bricks, is also due to economy as clay products are less cost effective due to higher energy cost. In Vietnam, two major items, clay brick and roof tile continue to remain profit making and beating the rival alternatives because of better pricing compared to production cost and due to higher demand. Vietnam Building Ceramic Association (VIBCA) and the Vietnam Association for Building Materials (VABM) said despite the government support to popularize the sun-dried cement concrete products, the consumers still prefer buying clay products in the rapidly expanding and Asia’s highest-growth Vietnamese building material markets. The Vietnamese brick and heavy clay manufacturers are increasingly using the tunnel kilns by replacing others, said the two associations. Several hundreds of VSBKs with many more hundred shafts have been introduced in Vietnam, and the soon forthcoming phasing-out deadline for traditional kilns may boost their dissemination further. Some 10,000 kilns may potentially be replaced by VSBKs, said the industry sources. Dr Hoang Anh Le of the Faculty of Environmental Science, Vietnam National University (VNU) of Hanoi, said the demand for tunnel kiln has largely increased in Vietnam as some low-cost versions of such kilns have been developed in the country at a cost of less than US$500,000, considerably less than the conventional Western models that require at least 5 times higher investments while operating at double capacity at minimum. The Vietnamese tunnel kilns produce some 50,000 bricks per day, while Western kilns operate at 100,000 bricks and more. Due to the relatively low investment, these tunnel kilns are highly profitable. A typical tunnel kiln requires an investment of US$424,000 and yields a net profit of some US$160,000 per annum, as reportedly estimated. In Nam Dinh alone, more than 25 of these low-cost tunnel kilns are already in operation. Although, clay products have huge demand in Vietnam, the Vietnamese government has decided that the building material industry will gradually shift to ‘clean production’ only. In that category, concrete and adobe bricks and blocks are energy-saving and environment friendly, as well as clean and green to the government. The government favours unburnt products, referring mainly to concrete and adobe building materials, as those have additional features, being light-weight, heat insulated, fireproof, compressible, easy to use, and allow reduction of construction time, save materials and investment costs, sources in the industry said. VABM said the government wants the unburnt building materials to account for 40 percent of total building material output by 2020 against the current 20 percent. It is expected by the government that by 2020, the unbaked construction materials would account for 40-50 percent of the materials used, said Pham Van Bac, head of the Ministry of

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Vietnamese brick manufacturers Viglacera Corporation’s subsidiary heavy clay products manufacturing companies, producing building blocks, teracotta bricks and roofing tiles. The plants include: Viglacera HaLong Joint Stock Company Viglacera Halong 1 Joint Stock Company Viglacera Dongtrieu Joint Stock Company Viglacera BaHien Joint Stock Company Viglacera TuSon Joint Stock Company Dong Anh Ceramic Joint Stock Company Viglacera Huu Hung JVC Viglacera TuLiem Joint Stock Company Viglacera HopThinh Joint Stock Company Viglacera Corporation Established in 1974. Location: Hanoi, Vietnam. Products: Machine made bricks and other heavy clay products. Production capacity: Viglacera is the the leading manufacturer of automatic machine made bricks and heavy clay ceramics in Vietnam. Its nine brick and terracotta companies with 15 factories meet the demand of the upper-end markets. Markets: Domestic and export markets. Bricks and heavy clay products have established markets all over Asia and other continents. Trademark/brand: Viglacera is known worldwide as a major brand of bricks and heavy-clay products. It is also known as a major ceramic tile and sanitaryware producer of Asia. Others: Viglacera Corp with its subsidiary companies are formerly stateowned manufacturers. Viglacera is now stock market listed. Viglacera also produces glass products and others.

Ha Long Ceramic Co Status: State owned Location: Ha Khau Precinct, Ha Long city, Quang Ninh, Vietnam Products: Bricks and heavy clay products, ceramic tiles, using Vietnam’s best clay from Gieng Day quarry founded by the French over a century ago. Markets: Domestic and export markets.

Building Materials Corporation No.1 (FICO) Location: Ho Chi Minh City (Factories of the subsidiaries are located in different places). Vietnam. Products: Bricks and heavy clay products including roofing tiles, pavers, refractory bricks, and others. Also manufactures ceramic sanitary wares, ceramic and porcelain tiles, Markets: Domestic and export markets. FICO products are exported to many countries, including, USA, France, Russia, Australia, Korea, Singapore, Taiwan and Japan. Others: FICO is a state-owned company, belonging to the Ministry of Construction, and owner of many bricks and ceramic manufacturers, including, Donai (bricks and roofing tiles).

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Analysis: Heavy clay

Construction’s construction materials department. Unburnt bricks are made from coal ash discharged by thermal power plants, cement and some other materials, he said, adding that the country’s annual capacity is seven billion this year, rising to 12.5 billion in 2020. Tran Ba Viet, vice chairman and general secretary of the Vietnam Concrete Association, said demand for construction materials is very high in Vietnam, because, the country is in the development phase. Annual demand from the construction sector is 20 billion bricks, which is expected to rise to 42 billion by 2020, but to produce one billion burnt bricks requires 1.5 million cubic metres of clay, he said.

Conventional conversion

The conventional commercial kilns are in the process of massive conversion mostly in the South Asian countries of Bangladesh, India, Nepal, Pakistan and the ASEAN countries of Cambodia, Indonesia, Malaysia, Thailand and Vietnam to Zig-zag and VSBK from FCK (fixed chimney kiln) and BTK (bull trench kiln) and others that dominated the markets in the past centuries. Bangladesh has converted about 5,000 of over 7,000 conventional kilns since mid this decade, mainly to Zig-zag. Compared to Southeast Asia’s better mechanization in moulding and backing of bricks, South Asian bricks are mostly hand-molded and then baked in Fixed Chimney Bull's Trench Kilns (FCBTKs). In South Asia, in recent years, many mechanized brick making plants and other varieties of kilns have been introduced, such as, tunnel kilns, the Hoffman kiln, the modified FCBTK, the Zig-zag, and VSBK. Traditional brick-making were creating air pollution that affects health and the climate. For years, the pollutions were taking human lives by spreading deadly diseases and the agriculturedepended Asian economies were badly losing top soils, some 2,840 million cubic feet per year, with threat to food security, of the farm lands as the laws and its enforcements regulating the brick industry became too weak in the hands of corrupt officials. Heavy clay firing in Asia is mainly a vast coal-burning and polluting industry and still in most countries the manufacturing is in the process of pre-automation stage. About 1,600 billion bricks are produced globally each year, of these about 1,400 billion bricks are from Asia, and about 400 billion of it are fired in South and Southeast Asia, according to industry sources. India’s Delhi based Central Pollution Control Board (CPCB) estimates China and India produce annually about 1,000 billion and 260 billion pieces of bricks, respectively. The production share of four neighbouring emerging countries, Bangladesh, Vietnam, Pakistan and Nepal are estimated to be 25 billion, 27 billion, 45 billion and 4 billion bricks, respectively.

Chinese action

For automatic brick production, the European and Chinese brick plant suppliers are already active in the region. European heavy clay product machinery manufacturers have entered India through joint collaborations, while Indian machine builders are also marketing their own products. In Bangladesh, Chinese machinery user Manikganj (near Dhaka) based environment-friendly machine-made brick manufacturing factory, Stone Bricks Ltd, said it is committed to reduce the environment pollution to save the earth and help in building great structures with quality bricks. Started production in 2015, Stone Bricks is the largest producer of clay bricks by automatic machines in a computerized process, with a production capacity of 300,000 bricks per day.

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Dong Nai Brick and Tile Corporation Location: Four factories in Dien Bien Phu Street-District 1, Ho Chi Minh City; Bien Hoa City (two factories), Dong Nai; and TanUyen District, Binh Duong, Vietnam. Annual production capacity: 115 million pieces of bricks, and ceramic and heavy clay products and 14,000 tons of refractory bricks. Products: Bricks and heavy clay and ceramic products, including, terracotta floor and wall tiles, decorated wall tiles, glazed and unglazed roof tiles, pavers, and refractory bricks, and ceramic floor and wall tiles.. Markets: Domestic and export markets. Others: Dong Nai Brick Co (TUILDONAI) produces a variety of automatic machine made bricks and outdoor tiles, in addition to various kinds of traditional fired clay bricks. TUILDONAI uses modern machines and high technology from Italy and Germany.

Vietnamese Ceramics JSC Location: Trangan, Dongtrieu, Quangninh, Vietnam Products: Heavy clay bricks and ceramic tiles, specially, standard quality terracotta tiles, which include terracotta floor tiles, wall tiles, step-nose tiles, ‘terracade’ façade and panel tiles and terracotta roof tiles. Markets: Domestic and export markets. Export destinations include Southeast Asian countries, China, Middle East, Australia NZ, among others.

Hue Restoration Pottery Enterprise Location: Hue City, Hue, Vietnam Products: Heavy clay and ceramic specialty tiles and blocks. Reputed for application in the restoration of ancient buildings by providing special kind of tiles like Luu Ly tiles. Markets: Domestic and export markets

Goda Cuong Thinh JSC Location: Hang Non, Hanoi, Vietnam Products: Clay bricks and tiles Annual production capacity: 30 million pieces per year Markets: Domestic and export markets. In addition to manufacturing clay bricks, Goda has developed a process that produces bricks and tiles from glass.

Thach Ban JSC Location: Hanoi, Vietnam Products: Clay bricks, clay tiles, pavers and roofing tiles. Markets: Domestic and export markets. Others: Heavy clay, porcelain and ceramic manufacturer Thach Ban JSC’s clay bricks and clay tiles manufacturing units include Thachban Brick and Tile joint stock company, TBSC7. Thachban Brick and Tile joint stock company No.28, Thachban Luong Son JSC9, and Thachban Blue Brick and Tile JSC

Nam Hiep Hoa Co Ltd Location: Binh Thanh Dist., Ho Chi Minh, Vietnam Products: Clay bricks, tiles, terracotta, earthenwares Markets: Domestic and export markets

TOKO Vietnam Co Ltd Location: Tan Quang, Van Lam, Hung Yen, Vietnam Products: Automatic machine-made bricks and heavy clay products and ceramic tiles. Markets: Domestic and export markets

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Analysis: Heavy clay

Gujarat based Neptune Industries Ltd, known for its fly ash brick plants, is one of the complete brick project suppliers that is launching major campaigns for new generation brick manufacturing through Alpina-Neptune Engitech (ANEPL), the Italian-Indian joint venture between Supertec and Neptune. The Chinese companies are directly supplying a large number of tunnel kilns to the Bangladeshi brick makers. Several thousand improved Zig-zag and other efficient brick kilns, a few hundred Hybrid Hoffman Kilns (HHK) and tunnel kilns also have gone into stream in Bangladesh in the last couple of years and their number is rising because of increasing demand of their quality bricks and other heavy clay products used by the real estate developers and other high-end and upper middle-class consumers who are constructing residential and commercial buildings and apartment houses. Most of their plants and machineries were imported from China and other East Asian countries. Larger plants are following procuring European kilns and other machinery and equipment that were introduced since the mid last century. A turnkey project of Hoffman kiln-based brick production plant for a small size of 50,000 pieces per day with Chinese technology will cost around US$1.5 million, excluding cost of land. Such factory will need some 20 workers per day-shift and consumption of 10-12 tons of coal for firing of 50,000 pieces of 10x5x3” size bricks commonly used in Bangladesh. China Bangla Engineering Co Ltd (CBECL), a new major heavy clay machinery builder from a Chinese machinery group, provides turnkey projects for machine-made brick manufacturing of different daily capacities ranging from 40,000 pieces to 200,000 pieces of various building bricks with successful marketing skill.

Scoping alternatives

Due to restriction on manufacturing in polluting clay brick factories in Indonesia and want of a viable low-capital alternative and replacement of using firewood all over the country, the production of clay bricks and improvement of its technology remains almost stagnant. Taking the situation in their advantage, the manufacturers of concrete building blocks of all types are expanding capacity since past few years. Many new companies are investing in concrete projects and foreign investors, like SCG Building Materials, of Thailand are looking for larger production in the coming years. For quality clay brick manufacturing, Indonesia has certain disadvantage compared to Malaysia, yet Malaysian heavy clay manufacturers also faces competition from concrete bricks. Malaysia’s Chin Hin Group, which operates pre-cast concrete facility and autoclaved

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Paradorn Bricks Co Ltd Location: Nong Khwai, Hang Dong, Chiang Mai, Thailand Products: Clay bricks, roofing tiles and other heavy clay products.. Markets: Domestic and export markets. Others: Paradorn clay roof tiles have good demand in Thailand despite great influence of widely used concrete roof tiles, as well as higher quality branded clay roof tiles. Paradorn clay roof tiles are exported to different Asian regions, mainly to East Asia, and ASEAN countries.

Wienerberger India Private Limited Location: Kunigal, Bangalore (Bangaluru), Karnataka Products: Automatic machine-made clay bricks Markets: Currently domestic markets, in future export markets. Others: Wienerberger India’s perforated “Porotherm Smart Bricks” are used in India’s thousands of projects ranging from residential apartments, commercial buildings, IT parks, hospitals, education institutions, hotels, resorts and individual houses across South India.

aerated concrete (AAC) production unit in Selangor, claims the cost saving by consumers over consumption of clay brick is over 25 percent. Chin Hin exports its products to many countries in Asia Pacific, including Singapore and Philippines, and expects to exploit the Indonesian markets too. Low emission manufacturing in heavy clay plants has provided considerable strength to the manufacturers of clay products in Malaysia, which has some of the best automatic machine-made clay brick and roofing tile manufacturing facilities that enjoy cheapest natural gas, petroleum products and electricity to the advantage of the heavy clay manufacturers. Malayan brick manufacturing is located mainly in Johor in the south and Selangor in the middle of West Malaysia, which is peninsular Malaysia. The markets of Eastern Malaysia, where Sabah and Sarawak sates are located, are catered by the West Malaysian manufacturers who have several quality productionplants, supplied from Western heavy clay technology providers,

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Analysis: Heavy clay

such as, Germany and USA. The domestic and global demand for quality heavy clay products, local rawmaterial base, and central location in Southeast Asia, Malaysia is a natural hub in production and marketing of clay blocks and bricks. Two of the countryâ&#x20AC;&#x2122;s largest building block manufacturers, Brick Dotcom Sdn Bhd (BDC) and Claybricks & Tiles Sdn Bhd (Claybricks), are regular exporters to different countries. In Johor state, the rich clay deposit enables the factories to produce a wide variety of products with textures ranging from smoothface, wirecut, rockface, sandblast, and cobble to tumble; while the colour ranges from traditional red, golden cream, peach, golden sand, brown, granite, lavender to many other combinations of shades and tones. The US$15 million state-of the-art Claybricks & Tiles plant uses China 80000 advanced clay preparation and brick making machineries and India 145000 10000 from the USA and Germany and employs Bangladesh equipments imported Vietnam 10000 the production technology for drying and firing of bricks in high 800 Nepal 18000 Pakistan capacity tunnel kilns and dryers. Located in Kota Tinggi, Johor, it has an annual production capacity of 300,000 tonnes of fired

products. Brick accessories and bricks of special shapes are also produced to fulfill the pursuance of perfection by some architects or designers. It also exportsÂ to countries in Asia, Europe, Africa and Oceania. Brick Dotcom, with 2 plants in Johor and 1 plant in Selangor, is the largest clay building materials supplier in Malaysia. It is a lowemission manufacturer, with a total production capacity of over 550,000 tonnes. It has a burgeoning export market that includes Singapore and Japan. Since beginning of the production and marketing of interlocking bricks In the Asian countries, Malaysia is an innovative manufacturer of this type of bricks with production locations throughout the county. In East Malaysian states of Sabah and Sarawak, heavy clay industry received state supports early this decade. Dunheved TableSdn 1 Industries Bnd (DISB), the Shah Alam-based manufacturer, supplier and distribution of interlocking bricks, and Daya Builders China Sdn Bhd (DBSB), a105wholly owned company of the Housing India Bangladesh 2 Development Corporation (HDC), have jointly developed public 1 Vietnam sector programme0.2 for housing in large scale. Nepal Pakistan

4.5

No. of brick producing units

No. of workers (m. people)

Table 1 China India Bangladesh Vietnam Nepal Pakistan

1000 260 25 27 4 45

No. of workers (m. people)

712 196 151 284 137 254

Brick consumption per capita

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AC 20-2

asian ceramics

Analysis: Tableware

Opportunit ASEAN makers and markets As China continues to struggle under the impact of the current virus-related restrictions on movement and therefore manufacture, can ASEAN pick up the slack? Jahir Ahmed reviews the region…

he ASEAN tableware manufacturers continue to remain stronger in global markets despite reduced growth in domestic sales and exports and increasing competition at the domestic and the world markets. Two largest manufacturers, Indonesia and Thailand suffered much setback in the largest export markets of European Union, USA and Japan following aggressive shipments from China, which also grabbed a substantial domestic market of the two ASEAN countries. China’s shipments of ceramic tablewares and kitchenwares to the ASEAN’s largest exporting country, Thailand, in 2019 was of worth around US$15 million, some two thirds of Thailand’s total imports of tablewares. China has supplied a half of Indonesian imports of about US$20 million worth of ceramic tablewares and kitechenwares in 2018. Indonesia is expected to improve its ceramic tableware industry greatly as the state run natural gas supplier, PT Perusahaan Gas Negara Tbk (PGN)., after some four years, has taken steps to reduce natural gas price by US$2-4 to about US$6 per mmBtu from April this year, after a long waiting of some four years for implementation of the government’s commitment to reduce gas price. “It is strongly expected that the government's support to negotiate a plan to reduce the price of natural gas/LNG to US$6 per mmBtu in April 2020 with the aim of increasing the competitiveness of the ceramics industry which has plummeted since a 50% increase in natural gas prices in 2013,” said Edy Suyanto, Chairman of ASAKI (Indonesian Ceramic Industry Association - Asosiasi Aneka Industri Keramik Indonesia). “The high gas cost component is around 30%-35% of the total production cost, making the ceramics industry in Indonesia unable to compete with cheap imported products from China, India, Vietnam. To note the price of natural gas in Indonesia is currently

asian ceramics

AC 20-2

one of the most expensive in the region ranging from US$7.98US$10 per mmBtu,” said Edy. “The Indonesian commerce department has imposed an antidumping duty of 30% to the imported tableware products from China, and the domestic producers have regained the market share back,” Edy told Asian Ceramics. Before 2014, the exports of tablewares to Indonesia was very insignificant of a million US dollars only. Indonesia also lost a substantial markets, mainly to China during 2014 and 2018. Indonesia’s tableware exports have plummeted from about US$137 million in 2014 to about US$95 million in 2018, according to the Geneva based International Trade Centre (ITC). Indonesia and Thailand are the major producers, consumers and exporters of tablewares in the ASEAN region. According to ASAKI and Ceramic Industry Club of Thailand (CICT), the ceramic tableware manufacturers in Indonesia and Thailand both are now

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Analysis: Tableware

ty knocks? PT. Sango Ceramics Indonesia Location: Semarang, Indonesia Products: Porcelain, stoneware and bone china hotelware and household tablewares Markets: Domestic and export markets Others: PT Sango’s porcelain, stoneware and bone china hotelwares are meeting domestic demands and exporting to many countries. Its bone chine plant is producing, specially, white ranges, for the hotel and restaurant industries.

PT. Hankook Ceramic Indonesia Location: Pasar Kemis, Tangerang, Indonesia Products: Porcelain and fine bone china hotelwares and household tablewares Markets: Domestic and export markets Others: PT Hankook Ceramic Indonesia is a leading quality manufacturer of tablewares with a production capacity of one million pieces per month. It produces bone china, vitrified fine china, porcelain and stoneware dinnerwares and gift items.

PT. Haeng Nam Sejahtera Indonesia Location: Bogor, Indonesia Products: Porcelain, fine bone china and stoneware tablewares Markets: Domestic and export markets Others: Brand - Haengnam

PT. Lucky Indah Keramik Indonesia

faced with cheaper imports from China, which also has huge surplus while its major export markets in the Western countries have in recent years imposed various restrictive measures on alleged dumping.

Indonesian dominance?

The ASEAN bloc’s largest ceramic tableware manufacturer Indonesia’s total active tableware production capacity in both organized and unorganized sectors is over a billion pieces per year. Under organized sector, the annual production is about 300 million pieces per year, while the production capacity is more than 300 million pieces a year. Many of the tableware makers are OEM suppliers to the global brand owners. The ASEAN region’s second largest manufacturer, Thailand, is going through a decade of continued decline, yet Thailand’s exports escaped any major fall compared to Indonesia.

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Location: Jakarta, Indonesia Products: Ceramic stoneware dinnerwares Markets: Domestic and export markets Others: Lucky Indah Keramik produces ceramic stone dinnerwares. Deep plates, bowls, flat plates, cups and saucers with different sizes. Also handpainted items, white wares, decorated items, soup plate with embossed designs on brown body, etc.

PT. Indo Porcelain (Inti Indokeramik Widya) Location: Tangerang, Indonesia Products: Porcelain hotelwares and household tablewares Markets: Domestic and export markets Others: Decades old Indo Porcelain is one of Indonesia’s major manufacturers of hotelwares and household tablewares. Its white porcelain products are on the market offering a broad choice of shapes, glazes and decorations. It also manufactures OEM for many of the world’s leading tableware brands.

AC 20-2

asian ceramics

Analysis: Tableware

The exports of tablewares and kitchenwares in 2019 were able to remain strong with shipments of about US$207 million terms of value. The apex association of the Thai ceramic industry, CICT, said the industry is experiencing a stagnant growth in production and slower rise in exports. However, the import is rising steadily. Because of slower growth in consumption, the domestic demand for local products continues to remain squeezed. CICT said, Thai tableware production has declined to 176 million pieces in 2019 from 235 million pieces of 2016. It said the Thai domestic markets of local products have squeezed to 69 million pieces from 96 million pieces of 2016, while imports from China have been rising. The export oriented Thai tableware manufacturers suffers from the adverse impact of the slower global and domestic markets. The manufacturers under organized sector have a considerable part of the production capacity unutilized. CICT estimated that in 2017 some 223 million pieces of tablewares were produced. It was much lower than those of the past several years. The Thai tableware production capacity is estimated to be about 300 million pieces under organized sector. However, the Thai exports of ceramic tablewares are still up to mark in terms of value. With a strong annual export of worth over US$200 million the manufacturers are earning profits. Compared to the organized sector, the unorganized sector, particularly, in the ceramic cluster of Lampang in northern Thailand, the smaller manufacturers are gradually upgrading their production facilities and manufacturing high quality products. Many of the Lampang-based porcelain and stoneware tablewares are exported throughout the world as quality products. Stonewares are being improved greatly by the manufacturers in Lampang. The technology is now available to develop high-quality stonewares with the help of high-tech machinery imported from the European countries, said Niyom Chourkittisopon, Managing Director of Royal Ceramics Ltd, based in Lampang. Niyom said Royal Ceramics’ high-quality products, fine stonewares, are whiter and brighter than the normal stonewares. Royal Ceramics is producing premium products of fine stonewares with many special designs and shapes, including, square and oval. Lampang-based stoneware manufacturer Indra Ceramic Co Ltd said much of their products are now manufactured as fine stonewares and marketed more profitably. Indra Ceramic has diversified products and end-users, targeting mostly the global markets. Indra said 75 percent output of its production capacity of 6 million pieces a year is catering export markets. Indra Ceramic is a major stoneware manufacturer with product lines of dinnerwares, mugs, gift and decorative items, etc, and producing quality porcelain mugs too. Being capable to manufacture porcelain tablewares, Indra aspires to have a full range quality porcelain tableware lines. Ceramic products of Thailand’s central region in and around Bangkok, where all major manufacturers operate, play the leading role in the country, yet, the country’s northern province of Lampang and its ceramic industry cluster in and around the provincial capital city of Lampang is

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PT. Doulton Indonesia (Wedgwood Royal Doulton) Location: Tangerang, Banten, near Jakarta, Indonesia Products: Porcelain and bone china hotelwares and household tablewares under the Royal Doulton and Wedgwood brands. Markets: Domestic and world markets Others: Nearly whole of the outputs are exported worldwide.

PT. Narumi Indonesia Location: EJIP Industrial Park, Cikarang Selatan, Bekasi 17550, Indonesia Products: Bone china hotelwares and household tablewares Markets: Domestic and export markets Others: The hotelwares produced in the Indonesian plant of the Japanese Narumi are supplied to the hoteliers worldwide.

PT. Kedaung Oriental Porcelain Industry (KOPIN) (also, IKAD Ceramics and KIG) Location: Pasir Kamis, Tangerang, West Java, Indonesia and Kampung Poglar, Kedaung Kaliangke, Jakarta Barat, Indonesia Products: Porcelain and stoneware tablewares Markets: Domestic and export markets Others: KOPIN, IKAD and KIG, under KIG Group of several manufacturers, produce on-glazed quality and decorated porcelain and stoneware tablewares since decades. Most of the high-end products are exported to the main targeted markets in Europe and North America, mostly for retail superstores.

PT. Semesta Keramika Raya Location: North Jakarta, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets Others: Brands - SKR, EATON

PT. Lucky Kurnia Impact Location: Kelapa Gading, North Jakarta 14240, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets Others: Brands - Mukura

PT. Jenggala Keramik Bali Location: Badung, Bali 80361, Indonesia. Products: Ceramic and stoneware tablewares Markets: Domestic and export markets Others: Brand - Jenggala

PT. Dynamics Mark Indonesia Location: Tanjung Morawa, North Sumatra, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets

PT. Sari Keramindo Location: Desa Cicadas, Bogor 16964, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets

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Analysis: Tableware

PT. Jatakekeramindo Kharisma Location: Jatiuwung, Kota Tangerang, Banten, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets

Royal Porcelain PCL

a major factor because of its command in the Thai ceramic industry being the largest supplier of raw materials and a significant caterer of the demand of domestic and world markets. The huge ceramic cluster and the related industrial and trading activities not only have made Lampang a famous ceramic hub of Southeast Asia, it is now poised to become the major ceramic centre of the Asean economic community that has just started taking a shape of regional free market. The government of Thailand is wooing Lampang for its potential in the ASEAN bloc and in checking the ever-increasing dominance of the close and industrially influential neighbor China. Lampang’s largest product category tablewares are losing domestic market share to China and needs urgent support, according to the CICT.

Lampang living

Lampang’s specialty for adopting and replicating or reintroducing Chinese blue ceramics and the traditional Benjarong porcelain and Celadon stoneware are well established among the collectors worldwide. Lampang has many of its own versions to offer. lts Oriental ceramics is recognized world over for artistic quality and standard. It has developed blue and white pottery to a very high level of aesthetic beauty for which Lampang is now known as center for the production of blue and white ceramicwares both in porcelain and stoneware. Thailand is rich in raw materials for making pottery and other ceramic products. Various ceramics, including pottery, of high quality are produced in several areas in the country, but Lampang has become the largest ceramic producing area, on more than one count, for better availability of china clay and other raw materials and dedicated work force in and around Lampang city, the centre of the industry. There are currently more than 700 ceramic SMEs, in addition to several dozen large and organized ceramic factories, in Thailand’s main ceramic producing provinces of Lampang, Ratchaburi, Saraburi, Chiang Mai, Samut Sakhon, and Sukhothai, and of them, more than 70 percent are in Lampang and the adjacent regions, including over 200 factories in Lampang city and its neighbourhood, with about 9,000 trained workers. More than a half century ago, the rooster bowl factories founded by the Chinese immigrants in Lampang have now become a major ceramic manufacturing activity because of huge demand at domestic and export markets. The white clay bowl, with a brilliantly colourful rooster, peony flower and banana tree hand-painted on its side, sold well and has become widely used in restaurants and Thai and Chinese households alike. The rooster bowl is now a symbol of Lampang and also of the Thai ceramicwares. In northern Thailand chicken patterns adorn the street signs almost everywhere. Due to availability of kaolin locally, rooster bowl production developed into a major industry in Lampang, Most of the

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Location: Tumbon Tandiew, Kaengkoi District, Saraburi 18110, Thailand Products: Porcelain and bone china tablewares Markets: Domestic and export markets Others: Royal Porcelain is the leading ceramic tableware manufacturer in Thailand. It has two state-of-the-art production plants, equipped with machinery suppled from the established sources of Europe and Asia, including, Germany, UK and Japan, with a total production capacity of over 20,000 tons per year.

Patra Porcelain Ltd Location: Nongpling, Nongkhae, Saraburi, 18140 Thailand Products: Porcelain, bone china and eartherware tablewares Markets: Domestic and export markets Others: Patra Porcelain is a leading Thai manufacturer of porcelain and bone china tablewares and reputed for its quality. Its award-winning PATRA brand is known to its global markets that spread over 40 countries. The brand is known for its pristine whiteness, higher durability and highly smooth glazed surface.

Crown Ceramics Company Limited Location: Kaoklung, Bangpong, Ratchaburi Thailand 70110 Products: Vitreous china, stoneware and terracotta tablewares Markets: Domestic and export markets Others: Crown Ceramics operates three production plants and produces over 10 million high quality tablewares per year. It has markets all over the world. And serves under its own ‘Crown Ceramics’ brand and customers’ brands and caters with customized/made-to-order design. Its portfolios of past and current customers in the international market include Disney Store, Starbucks, World Kitchen Inc, Dansk, Lenox, and Mark & Spencer.

Eastern Chinaware Co Ltd Location: Khlong Sam Prawet, Lardkrabang, 10520 Bangkok, Thailand Products: Ceramic and stoneware tablewares Markets: Domestic and export markets Others: Eastern Chinaware Co is one of the major Thai ceramic dinnerware manufacturer with specialization on stoneware body for home and hospitality industry uses. It is equipped with European and Japanese machinery and equipment and produces quality dinner wares, made to order on the customers’ requirements.

Imperial Pottery Co Ltd Location: Hangchat, Lampang 52190, Thailand Products: Porcelain tablewares, gift products and decorative items Markets: Domestic and export markets Others: Imperial Pottery Co manufacturers porcelain tablewares for hotels and restaurant in addition to domestic use. Its brand include, Leela and Baralee. It has some popular designs and shapes for full range of functional tableware items, with a production capacity of 12 million pieces per year.

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AC 20-2

asian ceramics

Analysis: Tableware

Lampang ceramic factories make rooster profitably as all supporting materials, including the skills of the artisans and other workers, are available in and around Lampang ceramic cluster at reasonable costs. Many of the Lampang manufacturers have upgraded and added basic modern technologies, shuttle kiln, tunnel kiln, and fiber insulator kiln, to reduce cost of production and increase productivity. Some of them switched to porcelain. The factories in Lampang city now range from small to large scale. There are about 30 factories for medium to large scale with number of workers ranging from 100-600 in a factory. There are about 120 factories of SME types with work force ranging from 10-80 in each factory. This generates a cash flow of some US$100 million into the Lampang province per year.

A mixed bag

Indonesia is one of the group of countries with biggest number of types and assortments of handicrafts in the world with a substantial economic potentiality. According to Erwidodo, Director General of the government run Trade Research and Development Agency of Indonesia (TREDA) which provided research and information on Indonesian pottery, Indonesia is estimated to have a capacity to produce around 37.523 million tons of pottery products per year, supported by more than 0.1 million skilled potters and artisans of over 30,000 SMEs. Most of the products are belonged to earthenware group, while others are stoneware and porcelain including some bonewares. Porcelain. boneware and stoneware products are best whitewares produced for marketing worldwide including home markets. Porcelain, which is made of kaolin and fired at 1280 to 1400 centigrade, is the purest white ceramics and translucent. Previously porcelain was made mainly for tablewares and other household items, but now saniatrywares and tiles are also made for higher quality whitewares. To increase the competitiveness of pottery SMEs, in domestic and export markets, the Indonesian government through the Ministry of Trade and Ministry of Industry initiated the development of pottery handicraft clusters in three regions, DIY (Daerah Istimewa Yogyakarta/Yogyakarta Special Administrative Region), West Java, and West Nusa Tenggara. Within each pottery/ceramic cluster in respective region, the government helps cooperative activities among businesses, suppliers, service providers, and business support organizations related to pottery/ ceramics. There are eight major production centers for pottery in Indonesia. Kasongan and Pundong (located in DIY, DIY/ Yogyakarta Special Administrative Region), Melikan (near Klaten, Central Java), Klampok (in Banjarnegara, Central Java), Plered (in Purwakarta, West Java), Sitiwinangun (in Cirebon, West Java), Lombok (West Nusa Tenggara), and Singkawang (West Kalimantan).

Quality Ceramic Co Ltd

Other markets

Location: Chomphoo, Muang 52000 Lampang, Thailand Products: Leading stone tablewares and gift items and porcelain china mixed products. Markets: Domestic and export markets Others: Kasalong Ceramics Co is a major stoneware gift item manufacturer. Its production capacity is two million pieces per month. In addition to stonewares, its chinawares for household and catering uses include half porcelain bone china, soft porcelain china, glazed pottery, and enameled porcelain.

Like Indonesia and Thailand, Vietnam also manufactures a huge quantity of ceramic tablewares under unorganized sector for domestic and world markets. The country has a few number of organized manufacturers and their total capacity is over 100 million pieces a year. Malaysia and Philippines have tableware plants in limited quantity in both organized and unorganized sectors. However, the ASEAN tableware sector is expected to grow stronger when the export market recovers and domestic demand

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Location: Hangchart, Lampang 52190, Thailand Products: Porcelain Tablewares and gift items. Markets: Domestic and export markets Others: Quality Ceramic Co offers six fine china collections both in plain and embossed pattern with complete range of tabletop items to serve the customers' specific expectation. The products are created to match the trend with innovative designs and shapes.

Indra Ceramic Co. Limited Location: Km.1 A. Muang, Lampang 52000,Thailand Products: Porcelain mugs and stone tablewares and gift items Markets: Domestic and export markets Others: Indra Ceramic Co is leading stoneware manufacturer with product lines of dinnerwares, mugs, gift and decorative items, etc, is producing quality porcelain mugs. Being capable to manufacture porcelain tablewares, Indra Ceramic aspires to have a quality porcelain tableware line.

Dhanabadee Art Ceramic Co Ltd

Location: Mueang Lampang 52000, Thailand Products: Porcelain vases and art and giftwares Markets: Domestic and export market Others: The porcelain vases are made with elegance and style. The oval design exudes a touch of modern serenity, making the vases good decorations for your home. Solely made by hands the products are in various designs. Dhanabadee Art Ceramic is reputed for high quality and superior design of products, which are exported to 92 countries around the world. The manufacturer claims it ensure the quality of the goods and enrich customers' lifestyles. It was awarded for excellence by foreign and local organization, including the Thai Prime Minister’s Export Award.

Kasalong Ceramics Co Ltd

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Analysis: Tableware

improves with a stable high growth of GDP in the regional countries in the coming years, as the region’s major economies of Indonesia, Malaysia, Philippines, Thailand and Vietnam, have strong growth projections for the next decade. Industry sources believe that the tableware sector will grab a significant part of the unofficially and liberally estimated ASEAN ceramics market that is anticipated to reach an annual market size of about US$70 billion by 2025. Tableware exporters are increasingly engaging the reputed designers in the market countries to compete with others including local products of the countries, which are importing alien items. Although, there is a trend of employing designers from the developed countries, many manufacturers are now using local designers in the ASEAN region. Reputed Indonesian manufacturer, PT. Sango Ceramics, said its Sango brand’s designs are substantially homegrown both for the domestic and world markets. Famous South Korean brand Hankook Ceramicware Co’s Indonesia operation, Hankook Ceramic Indonesia, said it has designers abroad for designing products for exports to the world market where cross cultural designs are greatly adored. Quality designer items have tremendous impacts on the users of the dinnerwares for appealing beauties that influence substantially its artistic flavours parallel to the tastes of the foods and beverages served on the plates used. Hankook Ceramic Indonesia applies attractive simple designs for products exported worldwide.

Vast army

There also exists a vast disorganized army of small and medium enterprises (SME) for production and export of tablewares in Java, Sumatra, Bali, Kalimantan and other islands. Those many hundred strong producers, particularly, potters, still have some sort of command in their domestic and export markets, but with disappointing profit. A major part of export earnings of tablewares come from the shipments of SME potteries and small tableware manufacturers, who are also rivals in the domestic markets against the organized sector with large and higher-medium operators with

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KK Ceramics Co Ltd Location: Tambol Chompoo Lampang 52000, Thailand Products: Porcelain tablewares and potteries for gift, decorative and other uses. Markets: Domestic and export markets Others: Porcelain household and domestic china wares for catering and other uses, hard and soft porcelain china wares, unglazed porcelain and china wares, soft porcelain china, half porcelain bone china, etc.

Royal Ceramics Co Ltd Location: Wang Phrao Sub-district, Ko Kha District, Lampang 52130 Thailand Products: Fine stoneware tablewares Markets: Domestic and export markets Others: Royal Ceramics produces high quality stonewares with machinery prcured from Germany and Sweden. It produces dinnerwares with various types of shapes and exports to various countries.

Lampang Silaphanakorn Co Ltd Location: Chompoo Lampang 52000, Thailand Products: Porcelain Benjarong tablewares Markets: Domestic and export markets Others: Half porcelain bone china, soft porcelain china, glazed pottery, enameled porcelain and chinawares for domestic, hotel, restaurant and other catering uses.

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Analysis: Tableware

Minh Long I Co Ltd

modern plants. On the basis of Indonesian market trend, the tableware sector is estimated to grow by about 9-10 percent annually next decade, on assumption of hotel business that is expected to grow well by an approximate 8-10 percent a year. However, this expected growing market will not certainly give a bright impact in favour of local tableware products since Indonesia market is flooded by low price imported tableware products, and the imports are tremendously absorbed by the local market, though the quality of imported tablewares is not as good as local tablewares. Under organized sector that has 12 large manufacturers of tablwares, including foreign investment units like PT. Doulton Indonesia (UK), PT. Narumi Indonesia (Japan), PT. Hankook Ceramic Indonesia (South Korea), PT. Haeng Nam Sejahtera Indonesia (South Korea), and Indonesia’s market leader PT. Sango Ceramics Indonesia and also several manufacturers’ group PT. Kedaung Oriental Porcelain Industry (KOPIN), are pushing ASAKI to put pressure on the government to reduce gas price to some US$5-7 per MMBTU, closer to Malaysia, Thailand and Vietnam, to remain competitive in the domestic and world markets. The Indonesian manufacturers are more or less dependent on the lower gas price and stable growth of consumption in the domestic market. If production cost continues to remain high Indonesian ceramics will face challenges from Vietnamese, Thai and Malaysian rivals in the domestic markets too, under free market opportunities provided by the Asean Community. Malaysian ceramic manufacturers enjoy cheapest gas and electricity prices in the ASEAN region that help them greatly in manufacturing cost-effectively in competition against imported products. But the Malaysian ceramic manufacturers suffer from higher operating cost due to higher cost of labour, overhead, imported rawmaterials, Malaysian currency exchange rate fluctuation, cheaper tableware imports, etc, that have increased production cost, particularly, of the labour intensive tabares, said FMM Malaysia Ceramic Industry Group (FMM MCIG). Malaysian tableware industry faces the challenges of increasing production cost due to higher cost of inputs and unstable markets following lower consumptions domestically as well as in less profitable exports, according to the industry sources. Malaysia’s tableware, kitchenware and hotelware manufacturer Claytan Group’s two tableware production units, Oriental Ceramics Sdn Bhd (OC) and Claytan Fine China (Tableware) Sdn Bhd (CFC) have concentrated on manufacturing strategic tableware products, such as, health-friendly and national pride tablewares manufactured fully locally with local rawmaterials.

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Location: Hung Dinh, Hung Loc, Thuan An, Binh Duong, Vietnam Products: High quality porcelain tablewares for upper end and higher middle class segments. Annual production capacity: Over 30 million assorted pieces. Markets: Domestic and export markets. Exports shipped mainly to Japan, USA and several European countries such as Germany, France, the Netherlands, the Czech Republic, Slovakia, etc. Others: Minh Long I Co Ltd is the leading ceramic tableware manufacturer in Vietnam and one of the top class Asian porcelain tabletop suppliers to the world market. Minh Long brand porcelain products are used on many occasions as the national brand by the government. It has a reputation of making extraordinary products for its quality and design work. Its modern machinery and production lines were imported from Germany and Japan to produce dining sets fired at 1,380° C with German technology. The products are gaining rapid access to the leading hospitality industries throughout the world for its high-quality design and manufacturing.

Chuan Kuo Ceramics Joint Stock Company (CK) (Chuan Kuo Ceramics Co Ltd is known as CK Ceramics) Status: Foreign investment (Taiwan) Location: Go Dau Industrial Zone, Phuoc Thai Village, Dong Nai, Vietnam Products: Quality porcelain tablewares, customized products and OEM items. Annual production capacity: About 30 million assorted pieces. Markets: Domestic and export markets. Exported worldwide, mainly to Europe. CK is a major manufacturer of ceramic tablewares in Vietnam with four ceramic plants, located in Ho Chi Minh City, Ha Noi, Ken Tuo and Da Nan. CK’s main targeted customers are upper and medium end consumers in Vietnam and abroad, famous brands (OEM), five-star hotels and restaurants, airlines, entrepreneurs, chain stores, area distributors, and giftware distributors.

HaiDuong Porcelain Joint-stock Company (HAPOCO) (Haiduong Porcelain Co Ltd) Location: PhamNguLao Street, Pham Ngu Lao Ward, HaiDuong City, with branch in Hanoi and Ho Chi Minh City, Vietnam Products: Quality porcelain tablewares and giftwares. Machinery/technology: Equipped with modern machines from Germany, Czech Republic and China Annual production capacity: About 30 million pieces Markets: Domestic and export markets. Others: Haiduong Porcelain Co’s products are exported to many countries worldwide.

Dai Hong Phat Ceramics Private Enterprise Location: Thanh Binh Hamlet, An Thanh Townlet, Thuan An District, Binh Duong Products: Ceramic and porcelain tablewares, kitchenwares, plant pots, vases, etc Markets: Domestic and export markets. Others: Dai Hong Phat Ceramics has a production capacity of about 8 million pieces a year. Its manufacturing facilities are equipped with modern machinery and equipment and skilled craftsmen. Its high-quality products are steadily gaining access to the world market and have so far consolidated markets in European Union, USA, Australia and the Asian countries.

www.asianceramics.com

Analysis: Tableware

OC and CFC are facing stiff competition from the imported tablewares, particularly, from China. OC produces high quality fine English earthenware and vitrified products for hoteliers and household uses, while CFC makes stoneware and fine china tablewares and artwares, and it is also stoneware OEM producer for Western export market buyers, Libbey, Verdi, Johnson Brother and Dansk. Vietnam’s organized tableware sector is, however, marketing porcelain dinnerwares successfully. Vietnamese’s Binh Duong-based porcelain tableware manufacturer, Minh Long I Co Ltd, is leading the country tableware exports. Ly Ngoc Minh, the CEO of Vietnam’s largest and national award winning prestigious porcelain tableware manufacturer, Minh Long I, with a monthly production capacity of about three million pieces of tablewares, is expanding Minh Long I’s markets globally for its highly impressive products with style and conviction. Minh has created many spectacular brand product lines. Porcelainware ‘Ly’s Horeca’ is one of them. Minh promoted this branded product at the APEC leaders’ summit. It has marketed a premium brand, Ly’s Horeca, to the customers from the hospitality industries, high-end hotels and restaurants. The specialized product line is manufactured using latest technologies in selecting raw materials and extreme tests of hardness and durability. Ly’s Horeca is designed to meet aesthetic requirements yet comply with technical features and functional endurance. The brand’s various collections are recognized for its unique ivory color that goes well with stylish designs and special features that reduce cleaning time, thanks to nanotechnology and elegant, glossy glaze. Minh Long is unique in some of its operations, from R&D to design to production and marketing. It is known throughout Asia and Europe for its very special quality products hardly common with others both in style and functionality.

Claytan Fine China (Tableware) Sdn Bhd / Oriental Ceramics Sdn Bhd Location: 57th Mile, Jalan Johor, Ayer Hitam, Kluang, Johor, Malaysia Established: In 1995, under Claytan Group Products: Claytan brand porcelain, earthenware and stoneware hotelwares and home tablewares Markets: Domestic and world markets Others: Claytan claims, Oriental Ceramics Sdn Bhd is Malaysia’s leading dinnerware manufacturer, producing full range of branded high quality fine English earthenware and vitrified products for hoteliers and household uses. Clyatan Fine China (Tableware) was established specializing stoneware and fine china tablewares and artwares. Both the manufacturing units have a total four different types of body. The tablewares serve both the hospitality industry and the household market segments.

Inhesion Industrial (M) Sdn Bhd Location: Mukim Kapar, 42200 Klang, Selangor, Malaysia Products: Inhesion Designer Series brand collection Markets: Domestic and export markets Others: The products are specially designed for selective users and niche markets, including hospitality industries.

Organised sector tableware scene of ASEAN bloc’s main ceramic producing and exporting countries. Production capacity, real production and home market in million pieces. Malaysia’s export-import in million pieces. Thailand and Vietnam’s export-import in million US dollars. Country 2019 2018 2017 2016 Real prod 300 est Real prod 290 Real prod 290 Real prod 290 Indonesia (organised sector) (organised sector) (organised sector) (organised sector) Real prod 4 Real prod 4.2 Real prod 15 Malaysia (export 24) (export 28) (export 35) (import 15) (import 14) (import 16) Real prod 186 Real prod 223 Real prod 235 Real prod 176 est Thailand (capacity 300 est) (capacity 300 est) (capacity 300 est) (capacity 300 est) (home market 96) (home market 73) (home market 91) (home market 69+) (export 183.4) (exp Jan-Sep 132.2 (export 178) (imp Jan-Sep 9.5) (import 13.4) (import 13.6) (capacity 100+) (capacity 100+) (capacity 100+) (capacity 100+) Vietnam (export 11.7) (export 14.2) (import 26.38) (import 26.34) Sources: ASAKI (Indonesia), MCIG (Malaysia), CICT (Thailand), VIBCA (Vietnam), and Asian Ceramics. Notes: Production capacity, real production, and home market in million pieces. Export-import of Malaysia in million pieces. Export-import of Thailand and Vietnam in million US dollars.

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AC 20-2

asian ceramics

State

of Uttar Pradesh, largest state of India with a population of more than 230 million occupies a special place in India. Located strategically in the northern part of the country, state of Uttar Pradesh is famous for ceramic tableware and insulator production from the unorganised sector units based in Khurja. Two of the leading organised sector ceramic tile producersKajaria Ceramics and Bell Granito operate large ceramic tile production unts in the state. Kajaria Ceramics operates a ceramic tile manufacturing plant ( vitrified tiles) with an installed capacity of 8.40 million square meters per annum at Sikandrabad. The other leading producer, Orient Bell Ceramics also operate a manufacturing plant at this location ( Sikandrabad).

Organised tile secto

However, state of Uttar Pradesh is known for the ceramic tableware production hub of Khurja. Located about 200 km from the national capital, Khurja is a ceramic tableware town, which has thrived for over 500 years. One can find a workshop or a production unit with an attached shop in almost every nook and corner of this town. Khurja had a total of 423 ceramic manufacturing units at the end of financial year 2018-19 (31st March 2019). Majority of these units produce ceramic tableware (mostly stoneware) and ceramic artware. A number of units are also engaged in ceramic insulator production.

asian ceramics

Ceramic industry of the town has achieved an annual turnover of INR 6.3 billion in the financial year 2018-19. About 30 % of the total production from Khurja is exported to countries in Europe, the Middle East , Africa and other Asian countries. Development of Khurja as one of the leading ceramic hubs in the country took off after the boom in the ceramic industry during the 1970s and 1980s. Few years back, the Government of India identified Khurja Ceramic Cluster as the leading growth center for export, which also gave a boost to ceramic manufacturing in the town. However, availability of natural gas as fuel since 2011 has been the single largest catalyst in the townâ&#x20AC;&#x2122;s ceramic industry. Most of the producers, who were using age old technologies based on coal fired furnaces have adapted to new fuel. In addition to change in fuel, a number of producers are adopting to new technologies and processes. Central Glass and Ceramic Research Institute ( CGSRI) , Khurja has assisted a number of ceramic producers to reduce the total cost of production of ceramic products by adopting to new production technologies and processes in last few years. The town has also received Geographical Indication ( GI) tag for the tableware products. According to L K Sharma, Scientist-incharge at Central Glass & Ceramic Research Institute ( CGSRI) Khurja, â&#x20AC;&#x153; It took five years for the Khurja industry to receive the GI tag. We have received the prestigious tag on account of

Nearly a dozen ceramic tableware producers have earned great repute in domestic and international markets. Producers such as-

Dadoos Ceramics, Chatwal Potteries and Hitkari Potteries have improved their product offerings by investing in the state of the art production technologies in last few years. These producers export a significant part of their production to a number of countries in Asia, Africa and CIS region.

AC 20-2

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UT TAR P R AD ESH

the work of skilled workmen in the town. The works of these craftsmen are renowned across the globe. Khurja pottery was always world famous, but, counterfeits had started to emerge in the country bearing Khurja’s name. Products manufactured in Khurja now bear a special hologram, which makes it very difficult to replicate.” Ceramic tableware production in Khurja 2014

2015

2016

2017

2018

Ceramic tile installed capacity ( in million square meters)

17.20

19.40

23.68

Actual production ( in million square meters)

14.10

13.68

14.58

16.60

18.10

Overall Capacity utilisation

82 %

79 %

75.15 %

70.10 %

76.43 %

Number of producing units

Ceramic giftware and artware production in Khurja 2014 Ceramic giftware and artware production ( in tonnes)

2015

2016

2017

2018

77,300

79,200

84,100

83,280

80,100

159

166

182

168

170

Number of producing units

Classification of production units on basis of production Product type Number of units % of total units Ceramic tableware units 138 32.6 % Ceramic giftware units 170 40.18 % Ceramic insulators 37 8.74 % Miscellaneous units 78 18.43 % Total 423 100.00 %

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"The ceramic industry in Khurja has come a long way. In the 1980s, the entire industry run on coal-fired furnaces One could see chimneys dotting the landscape, billowing smoke into the sky. It took 120 hours to produce 1 Kg of tableware products from a dead mass of 12 Kgs. The heat produced was intense and pollution levels were very high. In the last decade, a number of producers have shifted to gas fired furnaces, which has enabled them to produce better quality products. Though, for some producers installing an operating a gas fired furnace is expensive option in comparison to oil fired furnaces as the final price of the products is not very high,” Guljeet Minhas, Silico & Chemico Porcelain Works.

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asian ceramics

Talking Shop

A bright new tomorrow Rohan Gunasekera talks to Mahendra Jayasekera, MD of Lanka Tiles about the companyâ&#x20AC;&#x2122;s ground-breaking moves on Chinese cooperation and mosaic exports to the USAâ&#x20AC;Ś Sri Lankan ceramic tiles manufacturer and AC: Are there signs of recovery? exporter recently signed a deal with a Chinese Mahendra: Locally, so far we are not seeing a recovery. tile manufacturer to produce and export mosaic Sentiment is still low. And construction is also not really tiles from the island to the United States after the showing any signs of pickup. So we have to wait and US government imposed anti-dumping duties on see maybe another three-four months until after the imports from China. Mosaic tile shipments from the parliamentary elections (due after March) are over, revamped Lanka Tiles facility will start by April 2020. what local home builders and commercial and project In this interview with Asian Ceramics, Mahendra builders are going to do. Jayasekera, Managing Director of Lanka Tiles and Export markets are also not really doing well. USA is also Lanka Walltiles, both now part of the Royal doing okay but Europe is doing badly and Japan and Ceramics group, talks about the new project, with Singapore are still slow. And even if those economies Chinaâ&#x20AC;&#x2122;s Foshan Shiwan Yulong Ceramic Co. Ltd., are doing okay the competition in those markets is and how the company is expanding and fighting for very intense because of the China factor and even market share amid difficulties in the home market Malaysia has curtailed ceramic production. Malaysian Mahendra Jayasekera and intensified competition in overseas markets. factories are also giving very low prices, Indonesia also MD, Lanka Tiles AC: Can you describe the current status of the is giving very low prices. So, while the market is down market, both local and exports? the competition is also immense, which means overall Mahendra: The entire local market for the first nine months of this export markets are not really doing well. I think recovery will take about financial year (2019-20) has contracted a lot, dropping to 16.6 million two - three years. I can't see things recovering in a hurry. square metres in the nine months period from April to December 2019 AC: What's the position of Lanka Tiles in the local market? from 24 million square metres in the same 2018 period. Mahendra: Locally, Lanka Tiles has increased market share and we And the main victim is imports that have dropped by half, from 16 remain the biggest seller of floor and wall tiles in the market. We wish million square meters last year to 8.1 million square metres this financial to maintain that position which will be helped by the expansion we year. So, it really shows that the market is struggling and, of course, undertook last year and some parts of this financial year, where we when the market contracted our local manufacturers have increased increased capacity by about 35% and that capacity is also coming to their sales. For instance Lanka Tiles improved sales from 3.3 million the market. square meters to 3.5 million square metres. Total wall and floor tile capacity is 22,500 square meters a day and we And the competition is immense. Prices are dropping. Imported are the single largest producer of tiles in the country. We have a large product prices are coming down, especially from China and India. volume to sell and that means it is extremely difficult to get premium We see that because we are also importing ourselves. We used to pay prices for the volume of production we are doing. about US$4.8 to $5 earlier, but now we can buy from China at 3.7 dollars AC: How are you doing in terms of profitability? per square metre, at which price we can't even dream of producing Mahendra: We started commissioning our expansion last November, locally. So we are feeling the impact of that price reduction overseas in and we had a lot of technical issues. Certain machinery could not be the local market. commissioned on time. We also did a lot of trials in the body formulation, That is because China also has suffered a lot due to this trade war to get the right body for the new product we were trying to develop with USA and factories have either curtailed production or shut down. for the local market - very high quality, glazed, polished porcelain tiles So, they are in a situation where they have to dispose of their stocks in large formats like 60cm x 120cm and 80cm x 120cm. That brought and try and fill the capacity even at lower prices until better times come. down our capacity and also the yield. So we had a very bad six months

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AC 20-2

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Talking Shop

and then the last quarter, the third quarter, showed some kind of improvement because our factory was getting back to normal. The real profitability and efficiency of the factory can be seen only in the fourth quarter of this year, meaning January to March 2020. AC: What's your position in export markets? Mahendra: Export markets are very tough. We're trying to improve our footprint in export markets by adding new products to our portfolio. We're introducing a new product, mosaic tiles, which are in great demand in the USA market. Hitherto, China was the main supplier of mosaic tiles to USA. Because of the trade war Chinese exports of mosaic tiles to USA suffered a lot because the USA imposed anti-dumping duties on Chinese ceramic imports. So we entered into a tripartite agreement with a Chinese manufacturer and also a US buyer to produce mosaic tiles in Sri Lanka, under which arrangement the Chinese will transfer the technology to Lanka Tiles and we have a sale agreement with our American buyer to supply that product. We hope to commission that plant by mid-March and the first containers to the US should leave the factory by the end of March. We hope to do about US$6-7 million worth of exports in that product line alone to USA in 2020. AC: What prompted you'll to enter into this joint venture? Was it local factors or did the Chinese approach you? Mahendra: Actually, we had this buyer, who had been asking for new products from us and we saw this opportunity when the US government imposed anti-dumping duties on Chinese products. So we engaged in discussions, did research and found there was a suitable partner in China willing to cooperate with us. Because by doing that, they will retain their share of export markets, especially in the USA, and our buyer also will be able to supply his clients a good range of products and we'll be able to manufacture it and supply and benefit from this arrangement. Our US buyer was already a customer of the Chinese manufacturer and he was our buyer as well. So we had this common friend, common buyer who put together this deal. AC: What are the respective shares of the joint venture? Mahendra: In fact, it's a technical joint venture. There is no major investment involved. There is token investment from the Chinese and the American to signify their commitment to the project, but the bulk of the investment is from Lanka Tiles. Certain machines are coming from China and we are sharing the cost of that. Total investment is under $2 million. Because we at Lanka Tiles already have the facilities we can use to produce this product range, and we also had a line that was

asian ceramics

AC 20-2

unutilized temporarily because we had to decommission it to make way for the expansion. So we are going to commission that plant again and produce this. It is not profit sharing. We have a guaranteed off-take. Basically we pay a royalty to the Chinese manufacturer and also the American buyer for any sales we do outside the USA. AC: What is the production of the new product? Mahendra: We will be producing about 55 to 60,000 square meters a month. There's a potential to increase it. But we will first do this and then we'll see how to expand capacity. Because this we are doing with the Lanka Tiles floor tile plant and concurrently we are trying to start production of mosaic tiles in our wall tile plant also. That's a ceramic mosaic tile, but that will be a very small quantity - about half a container to one container a month right at the beginning - which is outside this joint venture and that we are doing on our own. AC: What sort of technical input will the Chinese give? Mahendra: Product design and development, and assembly which involves very fine technical details. Although at first glance it looks an easy and simple process, if you go deep into it, itâ&#x20AC;&#x2122;s more complicated than what you see on the surface. So, those technical inputs will be provided by the Chinese party. And sales support will be coming mainly from our American counterpart, with whom we have been dealing with for the last 40 years, and have a long relationship. He has an established network of buyers, which will help us. This deal will give US market access and help us learn cheap production techniques from the Chinese manufacturer. There will be a lot of transfer of technical knowhow like in machinery maintenance and product development. It's very seldom that we will get an opportunity to go deep into Chinese technology or technology used by a Chinese manufacturer. So we should be able to learn a lot of things from the Chinese manufacturer on how to make tiles at a competitive cost. AC: Producing in China is much cheaper than in Sri Lanka. Are there any cost benefits from this joint venture? Mahendra: No. there won't be any cost benefit because in any case our cost will be higher than the manufacturing costs in China for the simple reason that our glaze prices are higher, our raw material prices are higher, our labour is less efficient than Chinese labour. But still we'll be competitive because there'll be anti-dumping duty on Chinese products. We are trying our best to get to the Chinese cost of production. For that purpose we'll be employing Chinese technicians to work in our factory, 365 days of the year. They will tell us how to make tiles at a lower cost.w

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TRADE M NIGERIA: A MISSED OPPORTUNITY? Nigeria’s booming ceramic demand has frustrated industry experts locally as domestic manufacturers prove slow to take up the slack, and yet it is China that has usurped other more strategically-located suppliers to fill the gap… The importation of ceramic tiles into Nigeria, would by 2025 hit $2.1 billion, which amounts to over N761 billion. A Professor of Ceramics Engineering, Patrick Oaik-hinan, gave the figure on the sideline of the recent launch of Oaikhinan Ceramics Foundation in Lagos. Oaik-hinan lamented that despite Nigeria’s potential growth for ceramics, its import bill was huge. The professor, however, made known that the huge import bill was as a result of the gradual destruction of ceramics manufacturing in Nigeria, which according to him, was witnessed in the 1950s and 1980s when five international ceramic manufacturing companies located in different parts of the country went moribund. Oaik-hinan added that the ceramics industry was further affected by focus on crude oil production. “Currently, there are nine operating ceramic companies in Nigeria, eight for tiles and one for sanitary ware, and they operate under various capacities. Ceramics (ROYAL) is the oldest major manufacturer of ceramic tiles and is closely followed by PNT. “The average production capacity is 40,000-45,000 square meter per day for the eight manufacturing companies combined. I thank the Chinese for 100 per cent investment in six out of the eight ceramic tile companies, and the Indian with investment support for the remaining two tiles companies,” he added. Where are the Europeans? Neglecting Africa again… However, despite the Asian investment, there is widespread frustration with the government. “Inspite of the huge potentials of the sector to the nation’s economy in terms of millions of jobs it can create for the country’s unemployed youths, production capacity of the sector has remained very low. Inf act, Nigeria is counted after Egypt in Africa in terms of ceramic production, and Nigeria ranks eight position in the world. While there is the abundance of its raw materials in the country ranging from quartz, feldspar to clay, Nigeria still has a massive shortfall for ceramics demand”. Oaikhinan added.

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AC 20-2

He added that a lack of awareness due to non-inclusion of ceramics education, technology and engineering in the country’s educational system is one of the challenges confronting ceramic industry. Oaikhinan Ceramics Foundation boss added that low domestic participation in ceramic activities which has led to the sector’s dominance by the Chinese, lack of modern production technology and facilities, and absence of basic infrastructure such as motorable roads, water supply and regular power supply are major challenges confronting the sub-sector of the nation’s econmy. Going down memory lane, he noted that prior to the 80s Nigeria’s domestic ceramic industries such as Richware Ceramics Lagos, Modern Ceramics Umuahia, Nigergrob Ceramics Abeokuta, Ceramic Manufacturer, Kano and Quality Ceramics, Shagamu, and others, were working optimally. “But today, the industry is producing below-installed capacity because of lack of professionals with generic and technical skills in the ceramics manufacturing business. The absence of avenues for people that are interested in ceramic manufacturing businesses to pursue their ambitions has dipped growth in the sector”, he concluded.

China dominates again…

With an estimated approximated 203.42 million population and growing at over 2% per annum, Nigeria ranks the seventhlargest country in the world. The nation represents over 70% of the effective West African market, as Nigeria remains the most competitive destination for the establishment of medium and large manufacturing industries. No wonder, China has since positioned itself to take advantage of this expansive market by unleashing its horde of investors and businessmen on the manufacturing sector. From textile to garment; household appliances, furniture, automobile; consumables and iron and steel as well as Financial Technology (FinTech) products, China has taken over, churning out tons of products for various segments of the market.

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News

MATRIX Today, the investments of Chinese companies worth over $20 billion and still counting. In a recent interview, the President, China Chambers of Commerce in Nigeria, Ye Shuijin, said, “The 160 Chinese firms operating in the

country had also employed over 200,000 Nigerians. I believe the Chinese investment in Nigeria now is about $20billion and we have employed over 200,000 Nigerians. Our workforce is 95% Nigerians.”

Top sanitaryware sources (ranking based on m. pieces)

Top glazed tile imports (ranking based on m. sq metres

2010

2018

2010

2014

2018

China India Germany Egypt UAE Turkey

China UAE Botswana USA Spain Italy

China Spain UAE Italy Brazil Turkey

China Spain UAE Italy Germany Bulgaria

2014

China Italy USA Israel UK Turkey

China Italy Uk Spain UAE Turkey

Table 1 2016 2017 2018

Total

136 81 93

From China

95 51 60

2016 2017 2018

Total value of all ceramic imports (U$m.) Total

Table 1 Total

From China

Total

552,629 401,259 498,174

2016 2017 2018

Unglazed tile imports (sq metres) Total

From China

Table 1

From China 641,935 455,098 558,128

552,629

Total

Table 1 2016 2017 2018

From China

641,935

455,098 401,259 Sanitaryware imports (no. items) 558,128 498,174

Total

From China 5,235,723

Glazed tile imports (sq2,202,829 metres) 1531670 From China

3,448,391 1,386,257

1018714

Total

From China

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AC 20-2

asian ceramics

Insight

THAILAND Table 1-1

Natural gas

LPG

Electricity

2017

7.59

0.61

0.1

2018 2019

9.03 9.27

0.65 0.69

0.11

Natural gas

0.1

LPG

Electricity

Table 1 Raw materials Tableware Sanitaryware Insulator Tiles Refractory Supplies

25 14 13 4 18 2 20

Table 1-1 Natural gas

Ceramic Industry Club Profile by company type (%) Raw materials Tiles

Tableware Refractory

Sanitaryware Supplies

LPG

Electricity

2017

7.59

0.61

0.1

2018 2019

9.03 9.27

0.65 0.69

0.1

0.11

Ceramic industry energy prices Insulator

Natural gas

LPG

Electricity

Units: Natural gas US$/MMBTU; LPG US$/KG; Elec. US$/kWh

Table 1

Table 1 Tableware Sanitaryware Ceramic Cle Insulators Refractory

Tableware Sanitaryware Ceramic Cle Insulators Refractory

178 213.2 92.2 29.3 50.1

Ceramic exports by value (US$m.)

-2.94 18.77 -6.96 -2.01 19.86

Changes in export value (%), y-o-y

Units: Natural gas US$/MMBTU; LPG US$/KG; Elec. US$/kWh

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AC 20-2

www.asianceramics.com

Natural ga LPG Electricity

Table 1

Table 1 13.4 37.1 270.7 20.4 104.4

Tableware Sanitaryware Ceramic Cle Insulators Refractory

-1.47 40 7.46 7.94 5.35

Tableware Sanitaryware Ceramic Cle Insulators Refractory

Ceramic imports by value (US$m.)

Changes in import value (%), y-o-y

Table 1 2016 2017 2018 2019

180 132 125 120

Ceramic tile production (m. sq metres)

Table 1 2016 2017 2018 2019

Ceramic tiles domestic market (m. sq metres)

Table 1 2016 2017 2018 2019

8.6 8.6 8.9 9.3

Sanitaryware production (m. pieces)

1 235 223 186 176

Sanitaryware production (m. pieces)

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162 182 170 173

AC 20-2

asian ceramics

Hunter and the hunted

Meanwhile…in a rubber World… Dear Diary,

trade war between the US and China and the Strangely enough, this time last year I was writing about the As I write today the US, thanks to the everAct. potential for the US to reconsider the Hong Kong/US Policy and Hong Kong is in month seven of Iran with war hot real a of verge the on stable Donald Trump seems ed ‘One Country Two Systems’ suppos the of on ndisati its protests over the lack of democracy and Mainla arrangement. Interesting times. be difficult sometimes to come up with fresh After writing this column for I think over 13 years now it can about not having something new to write worry ideas or subjects. It’s doubly alarming on the one hand to factory conditions, child labour or the about write to have still I for where n about or to have the sad situatio been occasions however where have There e. improv not risks caused by say silica dust because they do or by Mr Editor. This is one such occasion. articles are suggested to me by colleagues in the industry at, an online news magazine for the Asia Diplom The from report a Recently a friend contacted me with friend works in organic products…solvents My . Pacific region which covers politics, economics and culture d senior manager and currently based in travelle and nced experie very a is He r. and resins and all that palave wonder what he did wrong in a past life I Logo’. ant Signific a South East Asia working for a ‘Multinational with as he was not born a ceramicist. as our pricing is higher than some of our His message included, ‘…we are constantly being batted Taiwanese manufacturers who have a terrible and competitors, but they are sourcing materials from Chinese rubber glove market which is a major the about talks he cally, Specifi .’ environmental and safety record in the US and Europe, constantly parties tion distribu the industry in Asia, ‘It’s all stems from the greed of the raw material suppliers…the glove distributors squeezing the glove manufacturers and in turn squeezing . And the glove distribution parties know exactly pricing s acturer manuf are constantly forcing down the glove this ourselves all too often in ceramics? The how the glove manufacturers are doing that.’ Haven’t we heard at are suspicious at best and cost savings arrived s saving cost the that before clear implication as I’ve written usually have at their heart a victim.

Clean Gloves & Dirty Fingers.

r scenario; manufacturers being pressed to Unfortunately, The Diplomat’s report discusses an all too familia e their profitability and increase their increas , margin r greate a make can tors reduce prices so that distribu But how can manufacturers reduce costs. reduce to s acturer bonuses and share prices; they push the manuf costs in a very competitive industry, a saturated industry? doctors, surgeons, scientists and so on is 300 Let us remember that the market for rubber gloves used by ts that need to be made to a high standard & produc BILLION pairs per year (so whilst a commodity these are ia. That is a market worth approximately Malays in made are Billion 189 d). grante quality cannot be taken for industry yes? As well as Malaysia; t buoyan a that’s so RM19.88 Billion. The market is growing at 12% that as it is a very competitive claim acturers China, Thailand & Indonesia are big manufacturers. Manuf Because in n my experience Really? costs. cut to cies efficien and market, they are looking at automation and that means fewer profits ation autom on those things are difficult to achieve – you need to spend money so much analysis, fine-tuning mean can which ll catch-a great a That’s cies? in the short term at least. Efficien so little, there are easier mean also can it ; ement improv ing and process modification, dedication to achiev ways to save money. Far easier. glove industry? If we turn our attention to a So, what has happened recently to draw attention to the rubber report in the Associated Press from last October: detention orders on goods imported from an U.S. Customs and Border Protection on Oct. 1 slapped rare that people producing those items might be ions allegat on unprecedented five countries in one day based used to hold shipping containers at the U.S. children or adults subjected to forced labour. The orders are oing.’ wrongd of claims the ate ports of entry until the agency can investig mentions two examples, firstly seafood report the but from came ions allegat the where from clear not It is made by Uighur Muslims being being s pyjama ly second and slaves by Asia being caught in South East and pertinent in the second case ting interes is What g. Xinjian imprisoned in Chinese ‘re-education’ camps in

*The views expressed in this piece reflect those of the author, and not of the magazine or its staff

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AC 20-2

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banned from supplying pyjamas to one company is the company involved, Hetien Taida had no sooner been er (Costco) claiming the goods were not custom the – ny they soon after started to export to another compa is oh so too common in what passes for made in the factory the supplier claimed they came from. Which supply chain paper trails. ic connection is? – The ceramic formers Moving to the Malaysian rubber gloves Industry (and the ceram own — WRP Asia Pacific — had its their of one that shaken were officials ry used in the industry). ‘indust ’ What types of forced labour are we talking products detained by Customs for allegations of forced labour. Bangladesh or Nepal; passport confiscations, about? The same we’ve heard about in the brick industry in ive recruitment, debt bondage, excessive decept ent, movem of m illegal withholding of pay, restricted freedo making a supposedly hygienic and is that y overtime and so on. Hardly an endearing list for the industr is hardly the catchy sound bite that the Isn’t’ y Industr Our – Clean Be May Gloves sanitary product is it? ‘Our read. to like er marketing department would desire or a custom visited American Embassy for clarification – Well, the Malaysian Ministry panicked – or rather they swiftly t and their biggest customer is the USA. bigges world’s the is y industr hardly surprising as their rubber glove y would propose a new chapter on ministr the ‘Malaysian Minister of Human Resources Kula Segaran said lous revelation, they had no miracu some was this all though As Act.’ yment forced labour under the Emplo previous idea about. industry – it has to import them and the Malaysia doesn’t have enough workers for its rubber glove cheap and plentiful. Fortunately, many both be to has force labour competition in the industry is such the s to support. Overseas jobs can bring familie have people in Bangladesh, Nepal and Myanmar need jobs and and choose who they hire and pick can They this. know rs recruite and funds d family at home much-neede Fees supposedly paid in full by ent. recruitm for fees agents often they choose to hire those that can pay the ce rtation insuran accommodation and so on. the manufacturers themselves who also should pay transpo You can hardly cut fuel costs, material costs – profit. into eats which Of course, these things all cost money lves to start to look at dubious cost-cutting. themse you can push down but then you force material suppliers , you can pressure the migrant labour course Of safety. and health or ment Likely as not hurting the environ es but migrant labour is always in practic best your ing illustrat – it’s easy to have written rules and regulations illegal or exploitive. Much migrant are that es the weak position, easily coerced or threatened to accept practic in debt working long hours for held if even t; ignoran plain or ess labour as it has no representation is powerl for the hungry folk back wages no and tion no pay and refusal or demand could result in contract termina Free; We pay Money to for Work ‘Slaves stated, r laboure one As repaid. be to home or the debt that has Work’. tion slaps detention orders on companies So, it is wonderful that the US Customs and Border Protec es. Good – hit the manufacturers where it practic ent abhorr similar suspected of using forced labour or using hurts – in the order book – in the pocket. the supply chain. You hurt the manufacturer But it isn’t much use if this impact is simply passed back down another company – or all too often via from source simply of the final product but the buyer and distributors squeeze for price reductions – the can they a front company. Or the manufacturers then turn to the people more hidden from the authorities. Speaking far are but es practic similar material suppliers who then enter into our customers to sign and chop a document from experience – I get at least several requests a year from me, checked that I do what I say. Never. audited ever has one no – r supplie stating that I’m a responsible , NGOs the US etc. to audit and confirm inavian Scand r But there is a movement amongst buyers whethe the supply chain to raw material sourcing? that products are ethically sourced but will this migrate down ing components suppliers used by the packag in abuses where Possibly as there have been instances on orders based on lower-tier suppliers’ detenti glove industry have been documented and the US can issue ns. We also need all customers & violatio nal’ ‘traditio or legacy s, previou for te violations. But it can’t backda ones. ened countries to buy into this – not just a few enlight that manufacturers will still try to pass cost As a result, whilst things may slowly improve, we can expect es are less visible. Also, the labour itself practic poor where le possib as savings down the supply chain as far is about time distributors and recruiters It . abused will be the last to see improvements and will continue to be they try to do something positive to will loss face they when only e becaus faced investigation and penalty address the failings. Until next time, 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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Torrecid leads with its latest innovations presented in a unique STYLE-CID: Store

As usual, the new year brought a new edition of Cevisama. On this occasion, Torrecid opted for STYLE-CID: Store, a flagship in which the highest level of ceramic products converged, made with the latest innovations and technologies in the market. Under an exceptional architectural design in a strikingly unique framework, STYLE-CID: Store was conceived in order to offer customers an experience impossible to replicate in another environment. It is a unique space where a collection of pieces with the most avant-garde and innovative designs, textures and effects resides. A perfect combination of technology and creativity capable of achieving the highest value-added products on the market within an exclusive space in the center of the Capital of Turia. They all formed a series of environments that allowed the customer to check first-hand the qualities of high class ceramics and its functionality.

Innovation: the Torrecid flagship stamp

Since its origins, innovation has been the basis of all its steps. For Torrecid it is not a fashion or an ephemeral trend, but a continuous process applied to all actions and decisions without exception. This offers customers the most advanced products and services adapted to their needs, capable of standing out from the rest of competitors. This constant commitment to innovation has brought numerous transcendent revolutions for the ceramics sector, such as porous monocoction in 1985 through high gloss surfaces or non-slip solutions. This led to the Digital Revolution with the implementation in 2004 of the first Digital decoration machine with pigmented inks. Step by step, this has culminated in full digital ceramics, capable of applying reliefs, finishes and effects from a purely digital system, also compatible with ECOINKCIDÂŽ water-based enamels and sustainable inks.

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With all these innovations, it was possible to move from a monotonous, limited and small-format ceramic to a light, large-format ceramic, with unrepeatable designs and loaded with an exclusive aesthetic. Its evolution has been such that it has been established as the reference material in emerging construction projects of architects, designers and interior designers. The expansion of the line of environmentally friendly solutions remains a priority in Torrecid. The latest developments in this regard are 2LOWINKCIDÂŽ enamels and inks. These emit low emissions, produce low odour and can be used with conventional printers and heads. During this edition of Cevisama 2020, the latest innovations launched by the Torrecid Group were very well considered and appreciated by customers, both national and international who visited the stand. New digital reliefs, metallised and reactive effects, multiformat countertops adaptable to all types of spaces and large formats were some of the most noted. Without a doubt among all of them, the new generation of high colour intensity inks stood out, capable of giving the pieces a very unique luminosity unpublished so far. Continuing with Torrecid's environmental commitment, these inks are respectful of both the work environment and the environment. To cope with the complicated perspectives that are foreseen this year in 2020, given the global economic and geopolitical situation, Torrecid has launched in this edition of Cevisama numerous and important innovations. Since innovation is the fundamental and essential tool that must be used to get out of difficult times, the objective of the Group is to continue evolving and growing both in the ceramics sector and in many others in which it already operates, not discarding the acquisition of new companies.

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