Asian Ceramics - AC20-4 by Bowhead Media Ltd

is this your own issue? subscribe online at www.asianceramics.com www.asianceramics.com

AC20-4

BUILDING THE RECOVERY TECH LEADS THE WAY

IN FOCUS: Fuels and firing Kiln furniture Vietnam: a trading hub? Kaolin supply dynamics

Plus news, views, analysis and much more!

Trust in Trend Asia’s largest kiln furniture manufacturer Trusted supplier to major names Reliable global partner ISO accredited - validated systems R&D customer support centre

Supporting your Success Trend Thermal Materials Co., Ltd No.39 Baozhong Road, Energy saving and Environmental protection Industrial Zone,Baodi, Tianjin 301800, China Tel:+86‐022‐60359588 Email: sales@beijingtrend.com.cn; songguoqing@beijingtrend.com.cn

www.beijingtrend.com.cn

PERFORMANCE CERAMIC SOLUTIONS by Saint-Gobain

Engineered ceramic solutions for extreme operating conditions that are custom designed, developed and manufactured for every customer need to deliver enhanced performance and durability while minimizing environmental impact.

OUR COMMITMENT

Smart Design In-depth understanding of customer application & processes, science, design engineering / mathemathical modelling and R&D

Performing Products Customized product design, shape & material for every application & industry, manufacturing robustness, quality consistency

Your Partner

Worldwide sales & application team, installation supervision services, OEM collaboration, energy & emission assessment

TECHNICAL CERAMIC FOR EVERY INDUSTRY AND APPLICATION

KILNS & FURNACES

BURNER SOLUTIONS

» LO-MASS® Systems Whiteware

» Ceramic Single Ended Radiant Tubes

» Hot Stamping Rollers for Automotive Parts

» Thermal Designs Radiant Tube Inserts for Reduction of Emission & Energy Consumption

» Rollers for Cathode Active Material Processing

WEAR RESISTANT SOLUTIONS

SPECIALITY CERAMICS

» Crushing, Pulverization & Grinding

» Thermocouple Protection » Shell & Tube Heat Exchanger

» Separation » Piping Components

» Semiconductor Wafer Processing

» Belt Conveyor Components

» Kiln Systems for Automotive Components

» SiC for High Precision CMMs & Air Bearing Stages

» Slurry Pump Components

» Filler for Adhesives & Encapsulants

» Distinctive Components

PERFORMANCE CERAMICS & REFRACTORIES

David Bordereau

david.bordereau@saint-gobain.com

ceramics.refractories@saint-gobain.com CHINA Andre Fan +86 180 170 8017 3

INDIA Ashish Saroch +91 991 020 0141

JAPAN Jim Hayashida +81 907 887 7474

SOUTH KOREA Sungmin Kwon +82 237 069 334

AUSTRALIA Arthur Wade +61 409 288 901

www.ceramicsrefractories.saint-gobain.com PERFORMANCE CERAMICS & REFRACTORIES

News

Contents: AC 20-4 News

Features

4 Inside Asia

34 Mota Ceramic Solutions in the spotlight

Kiln furniture under fire.

Indonesia pulls up the drawbridge…

Brendan Clifford, Co-CEO of Mota Ceramic Solutions gives his view on the challenges facing the industry as a direct result of COVID-19.

8 Across The Continent

36 Vietnam as a trading hub

6 Welcome

Openings, closures and industry moves from across Asia.

Our eye on the international arena.

In a departure from his normal column, William Hunter looks at how Vietnam is emerging from the Covid pandemic and interviews Mr John Hoang Giang of VITIS JSC about the country’s expanding influence on the tableware sector.

24 Material Matters

46 Kiln furniture supply and demand

18 International News A special report on kaolin.

30 Comment & Analysis COVID contraction for Italian tech.

In a year that had started so positively, 2020 will be long remembered by the expanding kiln furniture sector as one that put an instant halt to progress. Jahir Ahmed looks at how suppliers of this integral part of the production process are putting strategies in place for the “new normal”…

56 Fuels and firing technology

Rohan Gunasekera looks at how the heavy clay sector of Southern Asia is being forced into making increasingly critical choices over the type of fuel being used to fire brick-making kilns, and weighs availability alongside cost when it comes to strategizing for a future-proof factory…

Analysis 66 Talking Shop AC talks to Managing Director Thomas Alten (responsible for sales, R&D, finances) and Sales Director Georg von Oldershausen (responsible for sales area Asia) at Keramischer OFENBAU GmbH about the company’s prospects in a post-Covid industry climate…

Your favourite magazine is now available at the App Store… download today to see your first sample issue! Asian Ceramics: now for mobiles, ipads and androids

asian ceramics

AC 20-4

68 State of the Nation: Rajasthan The next instalment of our new section in the magazine, analysing the manufacturing bases of India.

70 In Advance In the latest of our new section dedicated to the advanced ceramics sector across Asia, AC focuses on developments in the increasingly competitive MLCC industry.

74 Insight

Analysis and insight into USA.

78 The Hunter And The Hunted

William Hunter dons the face mask and discusses the fall-out for Covid…

www.asianceramics.com

News

Inside Asia Under fireâ&#x20AC;Ś Ceramic kiln furniture manufacturers in Asia had been enjoying a stable growth of before the disastrous outbreak of COVID-19. Whilst tableware was relatively stable, the surge in sanitaryware production across the continent had made a major difference to the outlook of many of the makers of this hugely important component to the firing process. However, with shutdowns, lockdowns and closures, coupled with flattened economies in China, India, Indonesia, Thailand, Vietnam and others means the sector has been hit harder than most. This month, we take a look at how the industry is steeling itself for a tougher 2021 and how it can position its offering to ensure that recovery begins as soon as possibleâ&#x20AC;Ś

Welcome

is this your own issue? subscr www.asianceramics.com

ibe online at www.asiance

ramics.com

AC20-4

ndonesia has decided to re-impose a duty on ceramic tiles shipped from India BUILDING THE and Vietnam next Tuesday after the foreign RECOVERY producers managed to carve out a significant share for themselves in Indonesia ceramic TE CH LEAD S tiles market. TH E WAY Febrio Nathan Kacaribu, the head of fiscal policy office at the Finance Ministry, said on Friday that IN FOCUS: the tiles importers would be liable to pay a 23 Fuels and firing Kiln furniture percent safeguard measures import duty (BMTP) Vietnam: a trading hub? Kaolin supply dynamics for the next twelve months. The duty would drop to 21 percent and 19 percent in the second and Plus news, views, analy sis and much more! third years, respectively, he said. Indonesia removed ceramic tiles from India and Vietnam from the BMTP list several years ago. Since then, imports from the two countries have grown to pose a threat to local ceramic tile producers. "Based on the evaluation of the Trade Ministry in December 2019, imports of ceramic tiles from India and Vietnam in the 2018-2019 period jumped by 22.72 percent and 6.58 percent respectively," Febrio said in an official statement. Febri said the government intended to protect domestic ceramic tile makers and see them meeting most of the local demands. Indonesia has the capacity to produce 580 million square meters of ceramic tiles per year, the fourth-largest in the world after China, India, and Brazil, according to data from the Indonesian Ceramics Industry Association (Asaki). However, the industry's constant battle with high domestic gas prices often undermines local ceramic makers' competitiveness against foreign producers. "With the implementation of this duty, the government is committed to supporting the domestic industry, especially the ceramic tile industry, to be able to compete against imported products flooding the domestic market," Febrio said. He said the new duty still complied with the international trade provisions under the World Trade Organization (WTO). Under the agreement, a country can impose safeguard import duty when the imported products' market share has exceeded three percent of the market in the country. In the Indonesian ceramic tiles market, Indian and Vietnamese tiles have already exceeded that threshold, Febrio said. Indonesia has been actively supporting the ceramic industry in a more high profile way in the last 18 months, with the gas industry also under pressure to keep prices competitive. The energy ministry in April lowered the price of natural gas sold to power plants to $6 per million British thermal units (mmBtu) from $8.40. This is even though the price cap has created hurdles for a few gas projects, namely one with Repsol, which last year announced Indonesia's biggest gas discovery in 18 years. "We are having a tough discussion... we are determining whether (the project) can continue or not," Arief Setiawan Handoko, deputy head of finance at SKK Migas, told a virtual conference. "The price should not be more than $6, even though according to contractors, the economic price is above $7," he added. AC COVERS.indd 2

CONTACT DETAILS EDITORIAL Publishing Director Andy Skillen Email: askillen@asianceramics.com Direct line: + 44 (0) 208 123 0196

ADVERTISING AND DESIGN Advertising Sales Paul Russell Email: prussell@asianceramics.com Direct line: + 44 (0) 208 638 0619

01/09/2020 11:07

Happy reading!

Valerie Adamson Email: vadamson@asianceramics.com Direct line: + 44 (0) 208 133 5273 Production and design Tim Mitchell Email: tim@bowheadmedia.com Direct line: + 44 (0) 208 123 0839

RESEARCH Research Manager Alex Murphy Email: amurphy@bowheadmedia.com Direct line: + 44 (0) 208 123 0839

EVENTS Events Email: events@bowheadmedia.com Direct line: + 44 (0) 208 123 0839

Bowhead events OVERSEAS OFFICES China Professor Wen Xin Email: 18980921123@163.com Tel: +86 28 8701 9077 Fax: +86 28 8701 9077 Bangladesh Jahir Ahmed jahir@asianceramics.com India Yogender Singh Malik yogender@asianceramics.com Sri Lanka Rohan Gunasekera rohan@asianceramics.com

Andy Skillen Publishing Director

HEAD OFFICE Bowhead Media Ltd, The Old Casino 28 Fourth Avenue Hove, East Sussex BN3 2PJ

Got a general enquiry? use enquiries@asianceramics.com

asian ceramics

AC 20-4

Asian Ceramics (ISSN: 1476-1467), is published by Bowhead Media Ltd, registered in the UK no: 6127651

www.asianceramics.com

Ceramic tile industry braces for the storm • ISH unveils May 2021 date • EFI Cretaprint capitalises on tile indus regional growth • US imposes antidumping duties against two major suppliers • Kim Hin capitalises on China ex Jingdezhen suffers as floods move in • Kajaria Ceramics registers 20% decline in volumes • TSIA questions impor INDIA

Ceramic tile industry braces for the storm Indian ceramic tile producing industry is expecting the current year to be the worst in recent memory. A leading ceramic tile producer based in Morbi told AC on the condition of anonymity, “Due to the ongoing lockdown on account of COVID-19, the ceramic and real estate industry has witnessed a pile-up of inventory and slower realization of debtors. The performance for the first half of FY21 is expected to remain muted amid weak demand conditions. Further, the debt coverage indicators are expected to remain under pressure on account of upcoming repayment obligations and a slowdown in cash flows.” Vijesh Patel of Innovative Tiles Limited, a ceramic tile producer based in Morbi, “I believe that May and June have shown the industry that recovery could be

faster than what people were expecting it to be in the month of March and April. So going forward we should fulfil what customers need, ensure availability and accessibility of our products, these will be the key factors for the ceramic industry during the next 5 to 6 months.” One of the largest challenge that entire ceramic industry is facing is that ceramic producers will have to learn work on lower capacities and still remain viable. In precovid days we could even think of running factories at more than 80 % of the capacity utilisation. But now, we will have to get used to working at lower capacities and yet remain viable that will be a very big challenge for all the factories. A large proportion of migrant workers ( both skilled and unskilled workers) have moved back to

their native places and haven’t returned yet. Our communication with them regarding returning back to work has not been very productive as a majority of these workers are afraid of contacting the virus. Currently, our top priority is so get as much as local labour as possible. However, as you are aware that local labour has a number of other options and ceramic tile manufacturing is not among their priorities. In fact, this is the main reason of presence of large proportion of migrant workers in Morbi. Labour shortage has meant that total labour cost for ceramic producers has gone up significantly. Demand of ceramic tiles and sanitary ware in India is shifting towards smaller towns and rural areas. Traditionally, tier- I and tier –II towns have been the major demand drivers of ceramic tile and

sanitary ware consumption, but, ongoing Covid crisis has shifted the demand pattern substantially. Lockdowns in tier-I and tier- II towns and high number of covid cases have played a major role in this shift. It would be interesting to observe, whether this shift is temporary or permanent in the coming months. According to Abhisekh Somany, CEO of second largest ceramic tile producer in India, “In the wake of continued lockdown and lacklusture demand from tier- 1 markets, we moved our focus from tier-1 towns to tier 3, tier 4 towns, not even tier-2 towns, so much so that even pre lockdown 70 per cent to 72 per cent of our sales were coming from tier 2, 3, 4 towns, and increasingly after lockdown we are seeing this focus shifting even further.”

CHINA

ISH unveils May 2021 date Due to the recent COVID-19 outbreak in Beijing and in order to comply with the Chinese government’s strict preventive measures, ISH China & CIHE will now take place in May 2021 in Beijing. Also affected by the outbreak is ISH Shanghai & CIHE, which was originally scheduled for this September and will now take place in September 2021 in Shanghai. The organisers of the fairs made this decision to give participants more certainty in their planning for the rest of the year, given the uncertainty of the healthcare situation across the world and ongoing travel restrictions. Mr Richard Li, General Manager of Messe Frankfurt (Shanghai) Co Ltd outlined the rationale behind this decision: “Despite the Chinese government’s strong preventive

asian ceramics

AC 20-4

measures and initiatives after the recent outbreak in Beijing, to ensure that the fairs would operate with minimal disruption, this is a necessary action to take to guarantee the health and safety of our exhibitors and visitors in the midst of the uncertain global pandemic, ongoing travel restrictions and other constraints to business operations. Having progressed strongly over the years, the two fairs serve as the leading events for HVAC technologies and solutions in Asia and China, and we want this to remain the case next year when we can be confident of their success.” Mr Hongbo Li, Deputy General Manager of CIEC GL events (Beijing) International Exhibition Co Ltd, added: “All of our stakeholders are on-board with this decision. Hosting both

Beijing and Shanghai editions in the following year will allow HVAC firms worldwide time to adjust their market strategies during the current economic and industry upheaval. We look forward to welcoming our local and international participants to China next year to reconnect and further solidify the strong cooperation that already exists between industries and companies in this region.” As leading HVAC exhibitions in Asia, the ISH fairs in Beijing and Shanghai cover the product categories of HVAC products & technology, intelligent control, home comfort and plumbing. The two 2019 editions hosted a total of 1,550 exhibitors and welcomed 91,939 visitors. Returning in May and September 2021 respectively, ISH China & CIHE will continue to serve as

a comprehensive commercial HVAC solutions sourcing platform for China’s northern regions, while ISH Shanghai & CIHE will help industry players tap into the East and Central HVAC and home comfort markets in China. For more information about ISH China & CIHE and ISH Shanghai & CIHE, please visit www.ishc-cihe.com or email info@ishc-cihe.com. ISH China & CIHE and ISH Shanghai & CIHE are headed by the biennial ISH event in Frankfurt, Germany, the world’s leading trade fair for HVAC + Water which will next take place from 22 – 26 March 2021. For more information, please visit www.ish.messefrankfur t. com. Furthermore, the next edition of ISH India powered by IPA has been rescheduled to 18 – 20 September 2020, and will take place in Mumbai.

www.asianceramics.com

stry return • Cera results hit hard by Covid issuesRAK “optimistic” about xport slump • US imposes antidumping duties against two major suppliers • rt ban on tile and sanitaryware... CHINA

EFI Cretaprint capitalises on tile industry return As the Chinese ceramic tile industry begins to rebound, leading manufacturers are showing increased interest in EFI™ Cretaprint® Hybrid technology from Electronics For Imaging, Inc. for on-demand manufacturing of digitally printed ceramic tiles, using either eco-solvent or eco-friendly, water-based inks and glazes. Hybrid printers and other EFI Cretaprint solutions generated significant interest among attendees at the Uniceramic tradeshow last month in Foshan, China, where EFI completed nine orders for systems from leading manufacturers, including Champion Tile and Marco Polo. EFI Cretaprint participated in the show with Zibo, China-based distribution partner Cremix, a company known for its strong support of tile manufacturers. The successful exhibit with Cremix highlighted the modularity and versatility that have always been the hallmark of EFI Cretaprint technology. “Uniceramic attendees were able to see that Cremix and EFI are very closely aligned in our partnership,” said Cremix’s founder and general manager, Mr. Eddie Cheng. “We are both dedicated to supporting our customers’ businesses with innovative solutions,

and excellent service is our common target.” One of the Cretaprint printer purchasers at Uniceramic, Champion Tile, is a long-time EFI Cretaprint user that chose the new Hybrid system because of the productivity and sustainability advantages it provides. “We have been looking for a real innovation in ceramic decoration that may help us to differentiate our company,” said Mr. Tang Zhineng of Champion Tile. “The EFI Cretaprint Hybrid printer, with its ability to use water-based inks, is definitely an evolution aligned with our product and brand strategy.” In addition to the breakthrough Hybrid printer, customers such as Champion Tile are attracted to the complete ecosystem of solutions EFI provides for efficient, sustainable and productive digital tile decoration. EFI Cretaprint Hybrid technology has been extensively tested and implemented with a complete system that features water-

based inks and glazes, and an EFI Fiery® proServer digital front end that provides exceptional ink savings and highly accurate colour management for ceramics. The Hybrid printer’s ability to use water-based inks and glazes reduces VOC emissions by more than 90% compared to solvent-based inks, and carbon emissions by an average of 73%. In addition, water-based inks and glazes require less drying time and deliver a more homogeneous application of glaze, guaranteeing high quality in large format pieces and slab manufacturing. The ability to operate with water-based inks as well as eco-solvent inks is a unique advantage that only the EFI Cretaprint Hybrid printer offers. It also features improved ink delivery, cleaning and electronics systems to keep humidity and prevent sedimentation. The printer is available in widths from 700 to 1400 mm, with up to 12 printing bars. New, 5thgeneration Cretaprint software incorporated in the Hybrid printer delivers increased connectivity with third-party applications and an improved operator interface for increased ease of use. “This technology has been proven in the field, and it

received the prestigious Alfa de Oro award during the Cevisama trade show held in February,” remarked EFI Building Materials and Packaging Vice President and General Manager Evandro Matteucci. “Now, we are seeing growing interest in Greater China, reflecting both an increased desire to reduce the environmental footprint of ceramic tile manufacturing and the entrepreneurial spirit of manufacturers who are aggressive in adopting the latest state-of-the-art technologies to differentiate themselves.” Long-time Dongguan, Chinabased Cretaprint user Marco Polo, a large-scale manufacturer and distributor of architectural ceramics for the home, acquired an EFI Cretaprint Shield system and two EFI Cretaprint P4 printers to enable full digital production at its Jiangxi Wonderful subsidiary. Jiangxi Wonderful’s Shield system – the first such solution sold in China – consists of satellite bars for digital glazing and other applications. Shield technology gives customers the power to complement their existing equipment. Users can place Shield units prior to tile printing to apply digital glaze, or after tile printing to apply glues and other effects.

INDIA

Cera results hit hard by Covid issues Cera Sanitaryware has reported a loss of Rs 1.78 crore in the first quarter of the financial year 2020-21. Its profit after tax (PAT) stood at Rs 17.16 crore in the corresponding quarter previous fiscal, the company said in a BSE filing.    The company's total consolidated income stood at Rs 153.04 crore, a dip of 44 per cent from Rs

www.asianceramics.com

274.44 crore it recorded in the similar quarter last year.    "The Group's operations and financial results for the quarter have been adversely impacted by the lockdown imposed to contain the spread of COVID-19. The operations gradually resumed with requisite precautions during the quarter with limited availability of workforce and disrupted supply chain," the

company said in the regulatory filing.    The board of directors has also decided to discontinue the business operations of Cera Sanitaryware Trading LLC - Dubai, UAE.    "The unprovided accumulated share of losses of Cera Sanitaryware Trading LLC., Dubai (an Associate) has been Rs. 13.40 lakhs up to June 30, 2020 which have exceeded the Parent Company's interest in

this associate and therefore it is reduced to zero," the company said in the regulatory filing.

News, views and analysis www.asianceramics.com

AC 20-4

asian ceramics

News

UAE

RAK “optimistic” about regional growth RAK Ceramics, one of the world’s biggest producers of ceramics, is optimistic about growth in Saudi Arabia and other GCC markets following the introduction of anti-dumping measures to protect local ceramics producers. “We are well positioned to boost our sales in Saudi Arabia and across GCC region,” Abdallah Massaad, group chief executive of RAK Ceramics said. “Anti-dumping duties being introduced by the governments on import of ceramics from India and China will help us to increase our market share. We are also exempted from customs duties as a GCC company that will help in our growth.” In April, the GCC Industrial Cooperation Committee approved the imposition of anti-dumping duties on ceramic tiles imported from India and China. Imports from India face duties ranging from 17.6 per cent to 106 per cent, while duties on Chinese

imports will range from 23.5 per cent to 76 per cent. The measures came into force on June 10. Founded in 1989, RAK Ceramics exports its products, which includes sanitaryware and tiles, to more than 150 countries through a network of distributors in Europe, the Middle East and North Africa, Asia, North and South America and Australia. The company also has production plants in India and Bangladesh. Mr Massaad is particularly optimistic about growth in Saudi Arabia, the Arab world’s biggest economy. “We have a good market share, good reputation and already did many projects and therefore our sales in the first quarter have gone up in a big way,” he said. Mr Massaad did not reveal the total sales in the first quarter in the kingdom. An earlier statement from the company said revenue in Saudi Arabia increased significantly when compared to

the same period in 2019, driven by an 80.8 per cent increase in sales.  “We opened two showrooms in Riyadh and are opening two more showrooms in Jeddah. We are well set to grow in Saudi Arabia.” The company is also implementing measures to mitigate the impact of Covid-19 on its business in different markets. It shut down production in India and Bangladesh and reduced its production in the UAE. It also took measures to manage its liquidity, including cutting discretionary expenses and placing non-essential capital expenditure on hold. “We did what we all have to do to protect our company. We are very well in control and the company is in a good cash flow position. Every capex which is not needed now, we delayed it till after Covid.” Capital expenditure is set to drop to Dh100-Dh125m this year, from Dh225m anticipated earlier, the company told analysts on an

earnings call last week. The company has also restarted operations in Bangladesh and at a plant in India in Andhra Pradesh. Its other India plant in the state of Gujarat remains shut. RAK Ceramics, listed on Abu Dhabi Securities Exchange, reported an 18 per cent drop in its first-quarter net profit earlier this month as impairment losses climbed and revenue decreased amid the coronavirus pandemic. Net profit for the three months ending March 31 fell to Dh30.2 million. Impairment losses on trade receivables and dues from related parties rose almost five-fold to Dh6m while revenue dropped 3 per cent to Dh593m. “We are cautiously optimistic about growth in 2020,” Mr Massaad said. “We had a fairly good quarter and second quarter will be difficult for everyone. Starting from June, we can see [a] better market outlook and better demand as countries reopen their borders.”

TURKEY/INDIA

US imposes antidumping duties against two major suppliers A pair of antidumping and countervailing duty investigations involving imports of ceramic tile and quartz surfacing products have reached a final resolution, with U.S. trade officials ruling that domestic suppliers have been materially injured by imports that now have been slapped with unfair-trade duties. The U.S. International Trade Commission (ITC) last month issued final rulings in a pair of months-long probes involving ceramic tile from China and quartz surface products from India and Turkey, concurring with Commerce Dept. findings that exporters from the countries in question have been selling the contested imports at lessthan-fair market value in the U.S. As a result of the rulings, Commerce Dept. officials have issued antidumping and countervailing duty orders on the contested imports. Commerce Dept. officials several months ago had

asian ceramics

AC 20-4

announced an affirmative preliminary determination in its antidumping duty investigation of ceramic tile imports from China, finding that Chinese exporters have “dumped” ceramic tile in the U.S. at unfair prices. As a result of that decision, trade officials instructed U.S. Customs and Border Protection to collect cash deposits from Chinese ceramic tile importers based on preliminary rates ranging from 114.49% to 356.02%. Commerce officials had also announced a determination in the antidumping duty investigations of quartz surface imports from India and Turkey, finding that exporters from those countries sold the imports at less than fair value in the U.S. As a result of that decision, trade officials instructed U.S. Customs and Border Protection to collect cash deposits from importers of quartz surface products based on preliminary rates of up to 5.05% from India and up to

4.88% from Turkey. The Commerce Dept. action in the hotly contested ceramic tile case was the result of an unfairtrade petition filed in April, 2019 by the “Coalition for Fair Trade in Ceramic Tile,” an alliance of manufacturers that includes American Wonder Porcelain, Crossville, Inc., Dal-Tile Corp., Del Conca USA, Florida Tile, Florim USA, Landmark Ceramics and StonePeak Ceramics. Investigations into quartz surface imports from India and Turkey were initiated last year as a result of an unfairtrade petition filed by Cambria Company, the Le Sueur, MNbased supplier of engineered quartz surface products. Cambria has also battled successfully against quartz imports from China. The Chinese tile imports in question totaled some $624.4 million in 2018, 17.6% of the estimated $3.5-billion domestic market, according to government

figures. Leading import sources, aside from China, include Brazil, Italy, Mexico and Spain. Imports from those countries were not affected by the ITC and Commerce Dept. rulings. Leading quartz surface import sources, aside from India and Turkey, include Spain, Vietnam and Israel. The pair of unfair-trade investigations mirror a similar government probe involving Chinese imports of wooden cabinets and vanities. In that recently resolved landmark case, the ITC ruled unanimously that the U.S. cabinet industry has been “materially injured” by Chinese imports of wooden cabinets and vanities – a ruling that affirmed a Commerce Dept. finding that the imports were being subsidized and sold in the U.S. at less-than-fair market value, and paved the way for trade officials to impose stiff antidumping and countervailing duty orders on the imports.

www.asianceramics.com

News

MALAYSIA

Kim Hin capitalises on China export slump Ceramic tile manufacturer  Kim Hin Industry Bhd has expanded its export market to the United States, filling the market vacuum left by the withdrawal of China’s suppliers. According to executive chairman Chua Seng Huat, the Chinese suppliers have abandoned the US market due to the antidumping tariff imposed by the US government against China. He said Kim Hin had, therefore, re-positioned its export market and started shipping its madein-Malaysia products to US since the last quarter of 2019. “We look forward to achieving strong growth in this new export market. The group is expected to continue achieving future growth”, he added. As one of Malaysia’s leading ceramic tile manufacturer, Kim Hin group owns three plants, two in Kuching and Seremban and a third one in Shanghai, China. The group exports about 28% of its production output from the Malaysian plants to overseas markets, mainly Australia,

the Middle East, Taiwan and Pakistan. The Shanghai plant exports about 48% of its products to the Australian and North American markets. In 2016, Kim Hin strengthened its foothold and presence in the Australian market by acquiring Outset Holdings Pty Ltd for A$6.37mil. Outset is the holding company of Amber Group Australia Pty Ltd, which operates a network of 31 retail stores under the Amber brand in New South Wales, the Australian capital territory, and Queensland. Two years earlier, Kim Hin made its first major overseas acquisition and paid about RM22.65mil for Britain-based Norcros Industry Pty Ltd, a major importer and distribution of Johnson Tiles in Australia. Since then, Kim Hin has been manufacturing the premium Johnson Tiles in Malaysia for the domestic and export markets. Chua said following the downturn of the Malaysian property market in 2018, the demand for tiles had remained subdued. “The domestic industry

underwent a consolidation phase with major players reducing their production capacity and implementing cost-cutting measures. The import of tiles from China remains unabated, and this has created an excess supply situation in the market. Our export markets were also affected by the downturn, especially Australia and the Middle East. “Property markets remain weak in most regions and (there was) the excess capacity from China as a result of the US-China trade war. This created a supply imbalance to other regions with low import duty, Malaysia being one of them, ” he said in a yearly review of the group’s performance in the company’s 2019 annual report. In financial year to Dec 31,2019, Chua said the softening property market had affected the group revenue which fell to RM378.6mil from RM402.7mil in FY2018. As Kim Hin continues its efforts to strengthen and achieve revenue growth for its overseas

operations, the combined revenue of its overseas operations has, for the third consecutive year, surpassed the group’s revenue from Malaysia. In FY2019, the Australian and Chinese operations generated RM147mil and RM45mil revenue, respectively. This combined RM192mil from its overseas operations is 6.67% higher than its Malaysian operations revenue of RM180mil achieved in the same year. In 2015, the Malaysian operations contributed about 65% to group turnover. “The group’s initiatives in expanding its operation in its traditional stronghold market, Australia, and a new geographical location in Vietnam have successfully reduced its reliance on the Malaysian operations. “The increased contributions from its overseas operations act as the shield for the group which is facing continual soft market conditions in its Malaysian operation, ” the company said.

TURKEY/INDIA

US imposes antidumping duties against two major suppliers A pair of antidumping and countervailing duty investigations involving imports of ceramic tile and quartz surfacing products have reached a final resolution, with U.S. trade officials ruling that domestic suppliers have been materially injured by imports that now have been slapped with unfairtrade duties. The U.S. International Trade Commission (ITC) last month issued final rulings in a pair of months-long probes involving ceramic tile from China and quartz surface products from India and Turkey, concurring with Commerce Dept. findings that exporters from the countries in question have been selling the contested imports at less-than-fair market value in the U.S. As a result of the rulings, Commerce Dept. officials have issued antidumping and countervailing duty orders on the contested imports. Commerce Dept. officials several

asian ceramics

AC 20-4

months ago had announced an affirmative preliminary determination in its antidumping duty investigation of ceramic tile imports from China, finding that Chinese exporters have “dumped” ceramic tile in the U.S. at unfair prices. As a result of that decision, trade officials instructed U.S. Customs and Border Protection to collect cash deposits from Chinese ceramic tile importers based on preliminary rates ranging from 114.49% to 356.02%. Commerce officials had also announced a determination in the antidumping duty investigations of quartz surface imports from India and Turkey, finding that exporters from those countries sold the imports at less than fair value in the U.S. As a result of that decision, trade officials instructed U.S. Customs and Border Protection to collect cash deposits from importers of quartz surface products based on preliminary

rates of up to 5.05% from India and up to 4.88% from Turkey. The Commerce Dept. action in the hotly contested ceramic tile case was the result of an unfair-trade petition filed in April, 2019 by the “Coalition for Fair Trade in Ceramic Tile,” an alliance of manufacturers that includes American Wonder Porcelain, Crossville, Inc., Dal-Tile Corp., Del Conca USA, Florida Tile, Florim USA, Landmark Ceramics and StonePeak Ceramics. Investigations into quartz surface imports from India and Turkey were initiated last year as a result of an unfair-trade petition filed by Cambria Company, the Le Sueur, MN-based supplier of engineered quartz surface products. Cambria has also battled successfully against quartz imports from China. The Chinese tile imports in question totaled some $624.4 million in 2018, 17.6% of the estimated $3.5-billion domestic market, according to government

www.asianceramics.com

momic

SACMI.COM

DDG

[ DIGITAL DECORATION & GLAZING ]

Dual grain, structured surfaces, unique decorations: an all-in-one solution.

[ DDG ]

[ DHD ]

[ D DG ]

MORE PRODUCTIVE

MORE CONNECTED

MORE SUSTAINABLE

Fully digital dual-grain surface decoration. Added-value aesthetics ensures outstanding design and 3D effects.

Remote-controlled size changeover, texturing and decoration. Natively connected to HERE, the platform that maximises Digital Manufacturing 4.0

Technology ready for the control of water-based fluids to ensure sustainable application. Less grain consumption compared to a traditional cycle.

News

CHINA

Jingdezhen suffers as floods move in The floodwaters arrived so quickly in China’s “porcelain capital” Jingdezhen that Yu Ciqiong had just hours to save her business. As soon as she heard the city might be inundated, Yu dashed to the factory while her husband rushed to their shop to shore up its defences. The couple and their staff worked all day, moving plates, teapots, cups and other exquisite items to higher shelves and floors. But, when the water came – via a tributary of the swollen Yangtze River running through the city in the eastern province of Jiangxi – it washed over the levees and into hundreds of workshops, factories and shops, including Yu’s, before receding a day later. When she returned to her shop and factory last Wednesday, she found them wrecked. The floodwaters had reached two metres and the entire factory had been submerged. Several shelves had fallen, smashing cups, and the kiln was waterlogged. Gas tanks used to fire the kiln had simply floated away. There was dirt and debris everywhere. “The factory will probably stay shut for a whole month while we clean up,” Yu said. It was the second blow to the business

this year, already reeling from the devastating effects of the Covid-19 outbreak. The floods, which have been moving steadily eastward along the Yangtze, swollen by torrential seasonal downpours, have now spread to 27 provinces. More than 34 million people across the provinces have been affected and at least 140 are dead or missing, according to official figures. In Jiangxi alone, more than 6.42 million people have been affected since the floodwaters arrived on July 6, the provincial flood control and drought relief headquarters said on Wednesday, with the direct economic loss estimated at 11.76 billion yuan (US$1.7 billion). As the floods continue their relentless eastward journey, people in cities like Jingdezhen have begun cleaning up and counting their losses. Yu is one of thousands of family business owners in the city who have been making porcelain in their own kilns and selling to clients developed over many years. Caught off guard, they now must figure out how to make ends meet. Throughout Jingdezhen’s famous “porcelain street” and “porcelain village”, owners can be seen outside their front gates, washing dirt from surviving cups and bowls,

salvaging what they can. “My shop had become a fishing pond,” said one shop owner who had to manually pump the water out of her premises. While the porcelain could be cleaned, there was no saving the gift wrap, paints, wooden shelves and other products. Together, the shop owners in the area have cleared out truckloads of rubbish over the past week. Ning Zhongwei has had the Yunchun Kiln Shop for five years and business was stable at about 100 tea sets each month. He had developed loyal customers, including many who were tea shop owners in other provinces. “We focus on quality and have developed our own style,” he said. Ning’s most prized product is a cup made using the Doucai technique, developed more than three centuries ago, which builds intricate layers of decoration all competing for attention. “It requires three different techniques and is fired in different kilns with different temperatures, multiple times,” he said. But when the Covid-19 pandemic hit in January, even these prized possessions had to be locked away in storage as the factories of Jingdezhen were ordered by the government to

shut for three months. When Ning opened up for business again in May, sales had plunged 70 per cent. “It’s all a butterfly effect,” he said. “There were no tourists, my clients couldn’t sell tea, so they stopped buying teacups. We have no money, then we don’t go out to eat at restaurants.” It has became the main topic of conversation when Ning meets with friends in the same business. Those who are optimistic say business will slowly pick up while others fear it could take at least three years to recover. For Yu, the added impact of the floods have left her trying to figure out how to save her business. She has thought about live-streaming – since the coronavirus outbreak, many snack and clothing shops have taken their wares online. But porcelain is different, with a higher price range than online audiences usually are willing to pay. Right now, she is primarily focused on cleaning up and counting her losses before making further plans. “We only just started producing again in May, now we’ll have to shut down again. Misfortune is piling up on us,” Yu said, with a sigh, before turning back to the monumental task ahead of her.

Kajaria Ceramics registers 20% decline in volumes

News, views and analysis

Impact of Covid 19 has started to appear in the financial results of stock exchange listed ceramic tile and sanitary ware producers of India. India’s largest ceramic tile producer, Kajaria Ceramics posted a weak set of numbers during the quarter ending in March 2020. Sales volumes fell 20% YoY to 18.2 MSM on account of Covid-19 impact. Though, the company has performed relatively better than its peer Somany Ceramics, which

www.asianceramics.com

INDIA

asian ceramics

AC 20-4

reported a decline in volume of 28 % in the same period. Ceramic tiles sales volume decline in Indian market is largely attributable to disruption in logistics and closure of plants due to lockdown. In terms of resumption, Kajaria Ceramics restarted its Gailpur plant (partially), Malootana & Jaxx plants (in full capacity) in June and plans to open more plants gradually. However, overall weakness in the real estate sector and slowdown in the

economy implies that volume growth would only be back by FY22. The management has refrained from giving guidance for FY21E. AC believes that the Indian ceramic tile industry will see a steep decline in volumes in the year 2020, with the only solace being a sharp cut in operating costs. Overall, we expect sales volumes to fall 24-28 % YoY in FY21 with a sharp recovery in the form of 25% volume growth on a distressed base in FY22.

www.asianceramics.com

AL-JAWDAH PORCELAIN & CERAMICS

‫اﻟﺠﻮدة ﺑﻮرﺳﻼن و ﺳﻴﺮاﻣﻴﻚ‬

AL-JAWDAH INDUSTRIAL COMPLEX

‫ﻣﺠﻤﻊ اﻟﺠﻮدة اﻟﺼﻨﺎﻋﻲ‬ Web : www.aljawdahgroup.com Email : info@aljawdahgroup.com

Tel : 00966-11-265-0228 Fax : 00966-11-265-0158 00966-11-265-0159 00966-11-265-0160

News

asian ceramics

AC 20-4

www.asianceramics.com

News

SRI LANKA

TSIA questions import ban on tile and sanitaryware The Tile & Sanitaryware Importers Association (TSIA, has raised serious concerns about the Government’s import ban on their products, and clarified how such a move is detrimental to the Government’s efforts to reduce foreign exchange outflow. The TSIA, Sri Lanka’s main body established to address the grievances of tile and sanitaryware importers, consists of over 300 importers in Sri Lanka with a large majority of them having a long history of over 30 years of economic contribution to the country by way of tax revenue totalling Rs. 12 billion annually, employment opportunities to thousands, providing high-quality alternatives to local customers and many other benefits. At present, this industry provides direct and indirect employment to around 50,000 individuals islandwide. The 300odd members have appointed

over 2,000 dealers across the island, who in turn have helped to create entrepreneurs and develop the micro rural economies in various cities and towns.    The TSIA points out that imposing the temporary import suspension on tiles and sanitaryware imports will have a cascading effect on auxiliary related industries such as warehousing and logistics, clearing and forwarding, banking and finance, construction and commercial real estates. Such actions are also expected to increase under employment among a large cross-section of professions such as architects, engineers, consultants, quantity surveyors, sub-contractors as well as tile masons and daily wage earners.  TSIA members also occupy an average warehousing space of 2 million sq. ft. and approx. 200,000 sq. ft. of showroom retail space thus contributing to

the real estate revenues in the country. Therefore, restricting imports would adversely impact the income generated for warehouse and showroom owners all across the island. TSIA President Kamil Hussain said: “There is insufficient local production to meet the market demand and this has not only sent the prices higher but also had an adverse impact on the construction industry as well as domestic consumers when it comes to meeting project deadlines.” “It must be emphasised that while importers make a tax contribution of 100%, we service only 50% of the market share as local manufacturers are given preferential treatment in government tenders, allowing them to unfairly take advantage of a biased system,” he said.   “We understand the Government’s need to reduce foreign exchange outflow but

what we are simply pointing out through our facts and figures is that if you look at the big picture, there is hardly any benefit to the country from the import suspension while the damage caused by it can be felt by thousands of Sri Lankans in all corners of the island,” Hussain added. The TSIA states that its members are capable of bringing down major global players to invest in tile and sanitaryware manufacturing in Sri Lanka, but the investment environment is not conducive for any such organisation to setup operations here due to the poor Return On Investment (ROI), as a result of the high energy cost in local manufacturing and the relatively smaller size of the market. Therefore, the organisation maintains that importing is significantly cheaper than locally manufacturing and can provide better quality and more designs.

News

International News

Sibelco acquires Ukrainian clay producers Ukraine

aterial solutions leader Sibelco has announced the acquisition of two clay producers in the Donbass region of Ukraine. The acquisition will equip Sibelco with additional capabilities to support its customers’ growth in porcelain ceramic products. The market for tiles and ceramics is evolving rapidly with growing demand for high-end ceramics products such as slabs and technical porcelain tiles and increasing demand for whiter,

wider and more wear-resistant tiles. The best quality raw materials for the tile industry are without question Ukrainian clays, which offer a number of advantages including high

mechanical and bonding strength and the ability to guarantee reduced linear shrinkage and consequently superior flatness in the case of large sizes. Sibelco’s PREMIERE® clays also provide benefits such as high fusibility features that reduce the final porosity of the ceramic body and increase the speed of the firing cycle; a white-firing colour which improves the colour of fired tiles thereby reducing the usage of engobe in porcelain glazed tiles; a low level of organic matter that allows a fast firing cycle.

All of these benefits contribute to superior products and an increased production yield for customers. Sibelco is a long-standing leader in clays for the ceramics and tile industry and produces clays in Ukraine, UK, Germany, Russia and Indonesia. Sibelco’s its operations are supported by applied technology laboratories in Europe and Asia. The acquisition of Euromineral and Kurdyumovsky Plant adds a further 400,000 tonnes of annual capacity to Sibelco’s product portfolio.

ACIMAC rings in the changes Italy

he Italian ceramic machinery and equipment manufacturers’ association ACIMAC has a new Chairman. On Wednesday 8 July, the Annual Members’ Meeting unanimously elected Paolo Mongardi, Chairman of Sacmi, to lead the association for the two-year period 2020-2022. Born in 1964, Mongardi began working for Sacmi in 1985 as a project designer. He joined the cooperative’s Board of Directors in 2001 and took over as chairman in 2013. The three vice chairmen were also elected during the meeting: Paolo Lamberti (Chairman of Tecnografica), in charge of innovation, Luca Bazzani (CEO of System Ceramics), tasked with promotional and exhibition activities, and Bruno Bettelli (Chairman and CEO of I-TECH), responsible for association marketing. While maintaining its four-year duration, the new aspect of this chairmanship is the fact that it will be divided into two equal periods, with Paolo Lamberti taking over from Paolo Mongardi in two years’ time. This decision, approved by the association’s Board of Directors, reaffirms the association’s desire to bring together and protect the interests of all categories of companies represented by ACIMAC in terms

asian ceramics

AC 20-4

of both size (large and small companies) and types of business (suppliers of individual machines, complete plants and services). As Mongardi himself explained in his first speech as Chairman after thanking the outgoing Chairman Paolo Sassi and his fellow business leaders for the trust placed in him and his team, it is a formula that aims to ensure inclusivity and representativeness. “The fact that the Members’ Meeting has voted unanimously for the first time reflects the association’s unity in terms of its operations and vision,” said Mongardi. “I am taking over a big responsibility from Paolo Sassi at an economically challenging time for companies in the sector. I will fulfil my duties with enthusiasm and dedication in the knowledge that I will have the chance to work with an outstanding organisation.” The newly elected Chairman also set out some of the objectives of his new programme. These include creating new services for members (“although I am well aware of the level of excellence already attained”, he noted), further expanding the membership base (17 new members joined ACIMAC during the four years of the Sassi chairmanship) and ensuring greater involvement of companies in the association’s initiatives. One strategic

commitment will be to reaffirm and convey to the market the excellence of Italian ceramic technology, which is increasingly imitated by competitors but never surpassed, added Mongardi. Two other important pieces of news were announced to the large group of business leaders attending the ACIMAC Members’ Meeting. The first is the collaboration agreement reached with AMAPLAST (Association of Italian Manufacturers of Machinery and Moulds for Plastics and Rubber), based on the example of the agreement that has been in place with UCIMA (Italian Automatic Packaging Machinery Manufacturers’ Association) since 2011. While each maintaining their own autonomy and independence, the three trade associations representing different sectors of the capital goods industry and affiliated to the Italian employers’ federation Confindustria are combining their operational organisations in order to create synergies, expand the range of services offered and increase their critical mass. The new grouping represents over 1,000 companies with 55,000 employees and a turnover of more than 14 billion euros, 70% of which is generated by exports. “This organisational model will not only allow us to further

strengthen our system and create new opportunities, but has also been identified as an example to be followed by the national federation Confindustria,” explained Mongardi. “This is a source of pride to us because it demonstrates the value, professionalism and efficiency of our organisation.” Following the news about AMAPLAST joining the group of associations based in Villa Marchetti in Modena, already the headquarters of ACIMAC and UCIMA, the second important announcement made during the Members’ Meeting regarded the change of directorship of ACIMAC. Paolo Gambuli, Director General of the association since it was founded 30 years ago and of UCIMA since 2011, passes the helm to Mario Maggiani, former Director General of AMAPLAST. Gambuli, who will continue to work in an advisory role to the Chairmen, was thanked by the business leaders for his work over the years in transforming a small association into a solid and highly successful organisation that has become a role model within Confindustria. We welcome the new director general Mario Maggiani and wish him the very best with the challenging work that awaits him in these complex times.

www.asianceramics.com

OUR KNOW-HOW IS YOUR FORMULA FOR SUCCESS When it comes to ceramic auxiliaries, you can rely on our comprehensive expertise and our many years of experience. Ask us for more information: keramik@zschimmer-schwarz.com

News

Tile industry to get “lockdown” boost? United Kingdom

ceramic tile manufacturer and supplier hopes to take advantage of more people wanting to carry out home improvements now lockdown measures have eased. Craven Dunnill, which has sites in Bridgnorth and Jackfield, has already seen demand for its services grow as customers are keen to spruce up their homes. Simon Howells, managing director of the company, said: "We have certainly seen a bounce back, which is pleasing to see from a business perspective and p ersonal perspective. "We want to support people in the best way possible to allow them to continue building work and projects. "So far things have been very

positive as customers seem keen to carry out home improvements and start to get a feel of normality, but in a safe and secure way. "We have had appointments from all across Shropshire as well as much further afield." Like other businesses, the company has had to introduce Covid-safe measures following government guidelines. "We have adapted our retail showroom to offer our customers safe ways to shop, to suit them," Mr Howells said. "We are offering customers the opportunity to either book a one-hour appointment – during which they have exclusive access to our complete collection of tiles – to book a one-to-one phone or video consultation with one of

our experts, or to drop in at their own convenience during our ‘open access’ hours. "We have got a one-way flow system in place, perspex screen, encouraging card transactions, sanistiser station at the entrance point, gloves to allow customers to touch tiles, signage and floor markings. "Our goal is to be adaptable as possible, to suit different customers’ needs and shielding requirements, while protecting our staff, our customers, and local community at all times." The company, which has its distribution unit and retail showroom in Bridgnorth and manufacturing unit in Jackfield, is due to celebrate its 150th anniversary in 2022.

"We have been a Shropshirebased business, manufacturing and supplying ceramic tiles, since 1872. It's not the first crisis we have encountered, but perhaps the most unique in its terms of its speed of impact on business and we are doing everything we can to adapt and evolve to the new environment," Mr Howells said. Looking ahead, Mr Howells remains optimistic about the future. "I am an optimistic person. It's been a tough few months but I firmly believe there is a demand for home improvements as people refocus their spending away from travel and dining out. "I believe from every crisis comes something positive," he added.

Initiative seeks to create “virtual” exhibition Italy

wo minutes with... is a new initiative designed to present Italian ceramic companies’ latest new products. Aimed at enhancing the visibility of the Italian ceramic industry, the initiative consists of a series of two-minute promotional videos in Italian with English subtitles in which company ambassadors illustrate a recent collection using images of products and mock-ups.  At a time when it is simply

not possible to hold traditional physical events, this new Ceramics of Italy initiative provides Italian ceramic companies with a rapid and effective way of reaching their customers in Italy and abroad.  The showcased products reflect current trends in Italian ceramic tiles, ranging from the elegance of marble to the natural look of wood, from natural stones to slabs with a wide variety of textures and an increasingly realistic appearance. Nature and tradition are in evidence

amongst small and large size tiles suitable for both indoor and outdoor floors and walls. 3D digital decorations create ever new compositions and decorations with unlimited colour effects that make spaces customisable and unique. A new range of tile laying products ensures simple and impeccable installations with perfect results every time. All with the use of cutting-edge technology that fully respects the environment and the healthiness of spaces.

Glaze and colour players see uptick Spain

s hoped, sales figures for the Spanish ceramic glaze and colour producers in June showed a first important sign of recovery respect to the very negative results for April and May. According to the trade association ANFFECC, turnover fell by 24.4% compared to June 2019, a 20 percentage point recovery respect to the -40% registered in the 2 previous months. Exports were down 29.5%

asian ceramics

AC 20-4

respect to June 2019 (compared to -43 in May and -37% in April), while Spanish domestic sales recovered 30 points in a month, closing at -11.3% against June 2019 (-40% in May). The first six months of the year registered a decrease of 16.8% on H1 2019. So while the domestic market is showing signs of recovery thanks to the resumption of production activity in the Castellón ceramic district, foreign markets are still a cause for concern, particularly

given that they account for more than 70% of the Spanish glaze and colour producers’ annual turnover. While Europe is going back to normalization, other traditional markets are still affected by the pandemic, like India, Egypt or Brazil. ANFFECC notes that global tile production has declined considerably in recent months as the pandemic continues to impact construction activity and ceramic tile sales in many countries, creating a domino effect along the entire supply chain.

The videos are available not only on individual companies’ websites but also at www. ceramica.info and on the Ceramics of Italy social networks. They are also disseminated digitally to an international mailing list of architects, designers, retailers, installers and professionals.

NEWS IN BRIEF Just one in ten of all Italian ceramic technology manufacturers expect to see an improvement in performance in 2020 (10.9% of the total to be precise), while the share of those predicting a fall in revenues is double that of the previous year: 65% of entrepreneurs are pessimistic and two out of three of these expect to see an even worse contraction than that of last year. The impact of Covid-19 has compounded both the uncertainty surrounding the international scenario and the changes taking place in the construction sector worldwide, where innovative materials such as vinyl and resilient flooring are gaining market share.

www.asianceramics.com

CHOOSE THE ORIGINAL MADE IN ITALY

ALUBIT LEONARDO SIMPLY THE BEST

THE MORE EFFICIENT AND COMPETITIVE HIGH DENSITY ALUMINA GRINDING MEDIA YOU CAN FIND ON THE MARKET

industriebitossi.com

News

Johnson Tiles to lose up to 60 jobs United Kingdom

p to 60 jobs look set to go at tile-maker Johnson Tiles. The GMB has confirmed the union is in talks with the Tunstall business over redundancies at its Harewood Street factory. It added that the company hopes to achieve the job losses through a voluntary redundancy scheme to reduce the number of compulsory redundancies. It is now in consultation with staff at the business over the plans. A GMB spokesman said: "We're aware of 60 redundancies being made at Johnson Tiles. "We held a constructive consultation with the firm on Thursday and have ensured that Johnson Tiles would accept voluntary redundancies, where possible, in order to limit the number of compulsory redundancies and that the redundancy package exceeds that required by law. "We are holding webinars with our members to support and inform them throughout this process, and we will always fight for our members' jobs, no matter what."

While representatives from Johnson Tiles have not issued a statement about the plans, its parent company Norcros plc confirmed in a recent trading update that it is 'considering a number of restructuring programmes across the group which are likely to lead to a reduction in employee numbers of up to 10 per cent of our worldwide headcount'. It also released its full-year results for the 12 months up to March 31. The results show that revenue at Johnson Tiles was 'significantly' impacted by Covid-19, with reported revenue at £1.4 million less than expected. This meant that revenue for the year was only slightly up from 2019 - from £41.1 million to £41.7 million. Across the entire Norcros plc group - which includes brands such as Croydex, Triton and Norcros Adhesives which is also based in Tunstall - revenue increased by 3.3 per cent to £342 million - up from £331 million in 2019, while underlying profit decreased more than six per cent to £32.2 million -

down from £34.4 million last year. The company estimates that the impact of Covid-19 on operations and customer demand in its key trading month of March reduced revenue by around £13.2 million. Norcros plc chairman Martin Towers said: "The impact of Covid-19 has been significant, fast and unprecedented. The safety and well-being of our staff has been paramount in our considerations along with our key principle of doing the right thing at the right time for all our key stakeholders. "Our operating model and business continuity plans have proved to be highly effective during this period and our people have responded admirably to this challenge. "We have responded swiftly after lockdowns designed to slow the spread of the virus were announced in our major markets by mothballing all of our facilities, safeguarding our employees and operating our businesses with a skeleton staff working predominantly from their homes.

"While the majority of our customer base suspended their operations, it is pleasing that all our channels have now recommenced trading. "We have utilised all the relevant Government support in the UK, Ireland and South Africa and moved immediately to implement a cost reduction and cash conservation plan across the group. "The group's strong balance sheet coming into this crisis, and the swift actions taken to reduce costs and preserve cash, provide confidence that we have sufficient liquidity to enable the group to withstand an extended period of reduced trading activity." The news from Johnson Tiles follows similar announcements from a number of big employers in the city who are attempting to mitigate the effects of coronavirus. This includes Churchill China, which is looking to cut 250 jobs at its Sandyford factory, and Middleport pottery company Steelite International, which is axing up to 160 jobs.

SACMI takes over Euroelettra Italy

ACMI's takeover of Euroelettra Sistemi Spa was completed on 3rd August. The resulting reinforcement in the strategically important development field makes this latest acquisition a major success for the SACMI Group. It's also good news for the area, which sees the completion of a project designed to ensure operational/ employment continuity for this historic company, with additional growth prospects both within and beyond the industry. Established in 1979, Euroelettra Sistemi is, today, a global provider of solutions for the automation, plant engineering revamping and monitoring/control development of industrial plants. "This takeover", observes the President of SACMI Imola, Paolo Mongardi, "stems from SACMI's desire to strengthen its growth prospects also as regards external lines, especially the supply of plant flow monitoring/

asian ceramics

AC 20-4

control system installation and management services to customers and the Group parent company, all with an ever-sharper focus on Industry 4.0". Founded in the manufacturing district of Reggio Emilia, which has long-standing traditions in the automotive and electromechanics fields, Euroelettra has, over the years, diversified to become a leading provider to the energy (thermoelectric and hydro-electric power plants) and steel sectors. Moreover, in recent years it has further strengthened its role as a key provider of automation systems to the ceramic industry. Designing and automating energy generation and energy saving systems now constitutes one of Euroelettra's core businesses, with the company offering expertise in the revamping and improvement of existing systems. Close customer support during the set-up of 'turnkey' process control

systems is matched by outstanding 24/7 customer service (with opportunities for personalisation and the ability to coordinate management of data networks, feed systems and raw material batching plants, and supply and implement supervision systems). Subject to liquidation procedures since 2018, Euroelettra Sistemi enjoyed SACMI's support for 14 months via a company branch rental agreement that began in June 2019. Then, on 7th July 2020 came the red letter day: SACMI won the competitive auction and moved to complete the operation, performed with the full agreement of all parties (bankruptcy trustee, contractor, employees and their union delegates). "Completion of the acquisition", observes Paolo Mongardi, "was therefore a dual source of pride. On the one hand, SACMI has been strengthened in a strategic business area by acquiring a company

with a healthy portfolio and a sterling reputation. On the other, we've ensured operational and employment continuity for over 50 people, who will find new personal development opportunities within the SACMI Group". This latest acquisition has the dual advantage of strengthening SACMI's growth strategy in the automation field and ensuring operational/employment continuity for this long-standing Reggio Emilia-based firm, a global supplier of industrial plant control, monitoring and energy efficiency solutions

News, views and analysis www.asianceramics.com

www.asianceramics.com

Cretaprint

Choose Hybrid

Hybrid Ceramic Ecosystem

HYBRID PRINTERS AND DIGITAL APPLICATIONS

WATER FRIENDLY INKS AND GLAZES

FIERY COLOR MANAGEMENT

Tel: + 34 964 340 264 Â· cretaprintsales@efi.com

CUSTOMER CARE SERVICE PROGRAMS

Analysis: Raw Materials

Special Report: Kaolin In this issue’s raw material section, AC takes a look at the state of the current kaolin supply/demand scenario across the continent Named after a hillside ( Kao-Ling) near the village of Gaoling in Jiangxi province, China, where the clay was traditionally mined to supply the nearby famous porcelain factories in Jingdezhen, Kaolin has gained huge importance in the ceramic industry on account of its unique properties. Chemically inert, nonabrasive and in possession of a number of characteristics make this commodity highly desirable for use in a broad range of industries including ceramics, paper and paperboard, fibreglass, paints and coatings, plastics, rubber, pharmaceuticals and medical, cosmetics, concrete and agriculture.

Supply situation Catering to some of the fastest growing sub-segments of industry, kaolin consumption and production in Asian countries has scaled new heights in recent years, even if the last two years have seen something of a plateauing. Kaolin resources within Asia are potentially capable of supplying much of the regional demand although imports from USA and European countries will remain very important for some years to come. Global kaolin consumption was estimated at 26.9Mt in 2018, with 36% used in the paper market, 31% in the ceramics market, 7% in the paint market and 26% being used by rest of the industries.   Globally, Imerys, Quarzwerke (Sibelco) and BASF accounted for over 26% of production in 2018 and dominated Kaolin production and consumption in Asian countries Year

2014

2015

2016

2017

2018

Production (m. tpa)

13.71

13.81

14.01

14.10

14.60

Consumption (m. tpa)

14.23

14.79

15.10

15.40

16.14

Consumption in ceramic industry (m. tpa)

4.61

4.82

4.89

4.95

5.01

2020F

2021F

2022F

2023F

2024F

Production (m. tpa)

1345

14.90

15.20

15.70

15.90

Consumption (m. tpa)

14.01

16.10

16.60

17.45

17.90

Consumption in ceramic industry (m. tpa)

4.34

5.17

5.39

5.55

5.72

Year

asian ceramics

AC 20-4

Leading kaolin suppliers to Chinese ceramic industry Company

Location

Country

Installed capacity

Fujian Jizhou Longyan Kaolin Co

Longyan, Fujian

China

540,000 tonnes / year

Guangdong Chaozhou Feitianyan China Clay Mine

Chaozhou, Guangdong

China

360,000 tonnes/ year

Zhanjiaang Kelin Kaolin Co

Zhanjiaang, Guangdong

China

280,000 tonnes/ annum

China Kaolin Clay Co

Suzhou, Jiangsu

China

220,000 tonnes/ annum

Hunan Jiepai Ceramic Works

Henyang, Hunan

China

180,000 tonnes/ annum

Hunan Hengshan China Clay Mine

Henyang, Hunan

China

120,000 tonnes/ annum

Hunan Liling China Clay Mine

Liling, Hunan

China

90,000 tonnes/ annum

Wuxian Qingshan Clay Mine

Wuxian Jiangsu

China

35,000 tonnes/ annum

the global market. Imerys alone accounted for 16.3% of the market; other major producers include KaMin and Thiele Kaolin Co. (both US). In recent years, Asian producers have started to account for significant volumes but for the lower end of the quality spectrum. In Asia, China and India have the largest resources of kaolin. Annual kaolin production in China is estimated at over 4 million tonnes per year, approximately 2.6 million tonnes is hydrous, while the balance is calcined. Out of the total, more than 45% is used by the ceramics industry. Some sources put China’s annual output at approximately 20 million tonnes per annum but this includes ball clays and refractory clays, sourced from a total of 600 mines across the country. Three prominent domestic firms in Chinese kaolin mining and processing are Longyan Kaolin Company, Guangdong Chaozhou Feitianyan China Clay Mine and China Kaolin Company. Though, last few years have seen other mid-sized players such as Anhui Union Titanium Enterprises Company and Shanghai Yuefang industry and Trade Development Company gaining substantial market share. China and India are not the only countries in Asia to have indigenous kaolin reserves suitable for ceramic industry. A

www.asianceramics.com

THE EXCELLENCE ADAPTED TO YOUR NEEDS

www.xieta.com

High density alumina balls and lining bricks XIETA INTERNATIONAL S.L. * Travessera de Gràcia, 62 - 08006 Barcelona - Spain - T. (+34) 934 147 227 - email: ofce@xieta.com

XIETA EUROPEAN TECHNOLOGY, S.A. *Nave 13 - Pol. Ind. El Colador - Calle Cantabria, 10 - 12200 Onda (Castellón) - Spain - email: xieta@xieta.com

Analysis: Raw Materials

Kaolin consumption by different industry segments in India

Kaolin miners and processors in Indonesia Company

Locations

Country

Installed capacity

PT Alter Abadi

Belitung island

Indonesia

160,000 tonnes per year

PT Simaskaubelind

Belitung island

Indonesia

65,000 tonnes per year

PT Bangra Kaolin Industri

Belitung island

Indonesia

45,000 tonnes per year

Industry Segment

Market share

Cumulative market share

Cement

36 %

Ceramics

33 %

69 %

Paints

77 %

Paper

5.5%

82.5%

Rubber

87.5%

PT Daya Waruna Indragiri

Riau

Indonesia

40,000 tonnes per year

Pesticides

4.4%

91.9%

PT Fajar Perdana Permai

Bangka

Indonesia

35,000 tonnes per year

Refractories

3.3%

95.2%

PT Multi Mascot

Sulawesi

Indonesia

25,000 tonnes per year

Fiber Glass

2.5%

97.7%

Others

2.3%

100.0 %

PT Nipsea Martapura

60,000 tonnes per year

Kaolin miners and processors in Thailand Company Imerys

Locations

Country

Rangon

Installed capacity

Thailand

N/A

Naratiwat Kaolin Mines

Thailand

60,000 tonnes per annum

Sukhothai Kaolin Company

Thailand

45,000 tonnes per annum

Uttaradit Kaolin

Thailand

40,000 tonnes per annum

Prajeen kaolin

Thailand

38,000 tonnes per annum

Belacut Clay Company

Thailand

30,000 tonnes per annum

Advanced Minerals Asia

Thailand

100,000 tonnes per annum

number of mining companies that operate in Thailand, Indonesia and South Korea have been producing substantial tonnages, while Taiwan, Malaysia, Japan and the Philippines have smaller scale production. Despite the huge resources of kaolin in Asian countries, a number of countries in the region import significant quantities of this raw material. As Asian Chinese suppliers still donâ&#x20AC;&#x2122;t meet the technological requirements to produce large amounts of high-quality kaolin clay. High-quality kaolin clay is generally used by tableware producers because of the materialâ&#x20AC;&#x2122;s purity and whiteness. Huge opportunities in Asian markets have prompted a number of European and American companies investing in Asian Kaolin resources through joint ventures. Most of these companies have invested through companies based in China.

India

India has one of the largest kaolin resources in Asian countries. Under UNFC system, Kaolin resources in the country have been placed at 2,705.21 million tonnes. The reserves constitute only about 7% of the resources at 177.16 million tonnes. Out of the total reserves, 70% (about 124 million tonnes) reserves are under proved category whereas 30% (about 53 million tonnes) reserves fall under probable category. The resources are spread over in a number of states of which southern based state of Kerala holds about 25%, followed by

asian ceramics

AC 20-4

Source- Ashapura Minchem

states of West Bengal and Rajasthan (16% each) and Odisha and Karnataka (10% each). Out of total resources, about 22% or 608 million tonnes fall under ceramic/pottery grade, 4% of the total resources are classified under chemical, paper filler and cement grades and about 73% or 1,980 million tonnes resources fall under mixed grade, others, unclassified & not-known categories. Indian central government and some of the state governments are playing a proactive role towards the development of minerals sector. A few years back, govt of Keralaâ&#x20AC;&#x2122;s Mining and Geology Department through their investigation campaigns in parts of Kerala, identified two major kaolin zones viz., the southern china clay zone between Thiruvananthapuram and Kundara (Thiruvananthapuram and Kollam districts) and the northern china clay zone between Kannapuram Madayi-Cheruthazham in Kannur district to Nileswarm-Manjeshwaram in Kasargod district. An estimated reserve of 172 million tonnes (probable reserve of 80 million tonnes and possible reserve of 92 million tonnes) of china clay of sedimentary and residual origin has been arrived at. Kerala china clay is one of the finest quality clay available in the country. In fact, Kaolin marketed by English Indian Clays Ltd. (EICL), Thiruvananthapuram claims to have similar or even better properties compared to imported clays.

Ceramics the driver for India

Steady production growth in recent years in the Indian ceramics industry, which accounts for about 33 % of kaolin consumed in the country, has been one of the key drivers of kaolin industry in India recent years. With an installed capacity to produce 1,200 million square meter of tiles, 35 million pieces of sanitary ware and significant production of tableware, most of the Indian and international kaolin miners and processors are putting special emphasis in catering to this on sub-segment. Though, Indian paper industry is not a very high user of kaolin. But , much like the global paper industry trend, where Kaolin is being increasingly replaced with calcium carbonate , the gains from the one of the largest consumer of kaolin are slowly decreasing. However the boom in the Indian ceramic industry will propel the demand for kaolin in the country in the coming years.

Major players

India has nearly two dozen miners and processors of Kaolin. Some of the mid-sized producers have been able to increase their market share in last few years. In anticipation of robust demand

www.asianceramics.com

Analysis: Raw Materials

from end user industry sub-segments, most of the Indian kaolin processors have expanded their capacities in recent years. English India Clays Ltd., which is one of the leading producers of kaolin in country has streamlined its operations and is capable of processing a capacity of 240,000 t/yr from its three plants in the state of Kerala. Another major, Ashapura Group has expressed its intention to set up another kaolin processing plants, a couple of years back. Rajasthan based popular minerals has come up with a state of the art 130,000 TPA processing plant in 2015. Gujarat based, 20 Microns Ltd., expanded production at its Bhuj plant to 65,000 TPA from 40,000 TPA of calcined kaolin. The company claims to export more than 30% of its kaolin output to the Asia and the Pacific region, to the Middle East, and to Western Europe.

Ashapura Minchem

One of the largest miners and processors of Kaolin in India, Ashapura Minchem has been mining, processing and supplying kaolin products, from its reserves based in state of Gujarat for several decades. On recognizing the high demand and shortages of high quality kaolin, the company acquired new mine reserves of about 2.5 to 3 million tons in the southernmost state of India, Kerala. Ashapura claims, with a kaolinite content of 96%, quality of kaolin from these mines is far superior in terms of whiteness and other properties. The company also operates a kaolin processing plant with 180,000 tons per annum capacity at Trivandrum in the state. Speaking to AC, a key executive from the marketing department from Ashapura Minchem told, “ With 500,000 MTPA of kaolin mining and 100,000 MT of processing, we are among the largest players in Indian kaolin industry. Besides, domestic demand we also export a sizable part of our production to Japan ,Norway ,UAE, Spain ,Italy ,Turkey ,Cambodia ,Taiwan ,China Latvia ,Kingdom of Saudi Arabia ,Sri Lanka and Mexico. A significant proportion of Indian demand is imported, particularly in premium /higher quality of kaolin . Our Organization is trying to develop value added products to counter such imports.”

Kerala Ceramics

The oldest company in Indian Kaolin industry, state controlled, Kerala Ceramics traces its history to 1937. Acquired by the state government in 1963, the company produces about 30,000 TPA of processed kaolin. Located at Kollam in the southernmost state of the country, Kerala, the company take advantage of vast kaolin resources located within the state. Besides, domestic market, Kerala Ceramics exports kaolin to Malaysia, Australia and a few Middle Eastern countries. Commercial Manager at Kerala Ceramics Limited told AC in a conversation, “During last three years, imports of kaolin in India has increased. A large percentage of the total demand

asian ceramics

AC 20-4

in the country is imported from different countries. Imports of kaolin, particularly from China have skyrocketed. Though, in the face of current crisis on the border, the imports from China are expected to come down dramatically. During last few years, imports from other countries (USA, Ukraine and some other European countries) has dropped as Chinese producers have started supplying the market at comparatively low prices.”

English India Clays Limited (EICL)

Incorporated in 1963 in technical & financial collaboration with UK’s English China Clays ( ECC) ( now merged with IMERYS), English Indian Clays Ltd (EICL) is a leading miner and processor of kaolin in India. EICL’s collaboration with ECC ended in the year 1992, thereafter, the company has formally changed its name from English India Clays Ltd. to EICL. EICL’s clay division has three manufacturing locations in Kerala ( Veli, Thonnakkal and Kollam of Thiruvananthapuram district) and specialises in mining and processing of high end kaolin. Company’s clay business is one of the largest integrated clay facility in India with a total installed capacity of 240,000 tonnes per annum. On the negative side, EICL’s captive mines in Thonnackal has ceased operations following a court order in late 2019. According to EICL management, “ The monthly raw material requirement is approximately 70,000 tonnes. The company had been incurring a loss by continuing production using costly raw material procured from Gujarat and elsewhere. However, the situation has reached a juncture where it cannot be sustained.” Citing concerns over shortage of raw materials, rising operational costs, and legal and environmental issues leading to stop of mining activities at its clay mines, EICL has served a temporary closure notice in the year 2019. While the management is confident in getting environmental clearance certificate shortly thus resulting in resumption of mining operations. EICL was also in the process of setting up a new clay processing plant at Cuddalore, Tamil Nadu; which was expected to be completed by December 2019 and start of operations in Q1 FY2021. However, the project has been put on hold due to the ongoing issues at its clay operations and also over possible uncertainty over supply of raw materials on the new project. The company had spent around INR 240 million on land and site development of the plant.

Popular Minerals

Rajasthan based, Popular Minerals has emerged as one of the key miners and processors of kaolin in India in last few years. The company owns 26 mining leases over twenty square kilometers (400 hectares) at Sawa in dist Chittorgarh of state of Rajasthan. Popular Minerals operates five small and a large

www.asianceramics.com

Analysis: Raw Materials

kaolin processing unit at Sawa. The company can process between 10,000 to 12,000 tonnes per annum of washed kaolin from each of its five washing plants, which are located within a periphery of10 km of its kaolin mines. A few years back, the company established a new plant ( M S Sawa Clay & Minerals Private Limited) , with an installed capacity of 400 tonnes per day of processed kaolin. With the new plant, Popular Minerals has made its place in last three Kaolin processors in the country. According to Jayesh Dave, Business Development Manager of Popular Minerals, “ We are one of the leader in kaolin mines in India. Our operations are based in the state of Rajasthan state. We are able to mine 1.5 million tons of kaolin clay per annum from our mines at village banesti Dist chittorgarh. We have an installed capacity to produce 10.000 to 12000 tones of washed kaolin from our different 5 washing plant located in 10 km of our mines area at different places. In addition of that we estabilished one of the biggest kaolin processing plant to produce kaolin for different  industrial application such as ceramics, paints and paper. Processed Kaolin demand in India isnearly 1.4 million tonnes per annum ( Hydrous - Calcined kaolin demand including ceramics / paper / paint / rubber).” Jayesh further says, “With our new kaolin processing plant, we are able to process premium grades of kaolin, which are used in high end ceramics, paper and paint industries. Indian ceramic industry, particularly Gujarat based producers have added huge

AC_2020_halfpage_techtalk_Aug.indd 1

www.asianceramics.com

capacity of ceramic products in recent years. This has resulted in huge demand from this sub-segment. Hitherto, most of the kaolin needed in these ceramics units used to come from Southern part of the country, which entailed high transportation costs. With our new plant, we have been able to reduce transportation cost as well as delivery time to the ceramic clusters of Gujarat.”

Imports

India has abundant resources of kaolin which can easily meet both the domestic and export demand. The processing of kaolin in the country is done mostly by conventional methods like levigation and washing. New capacities for high-tech processing have to be established and existing capacities in the country have to be augmented to meet the demand of processed kaolin in the future. Despite having vast resources of kaolin, India is still dependent on imports of kaolin. Different industry stakeholder, AC spoke to gave a different figure on quantum of kaolin imports in the country. According to Jayesh Dave of Popular Minerals “About 6 to 8 % of total Indian kaolin demand is imported. Imports are mainly concentrated for digital glazes in ceramic industry and some segments of paper and paint industries. Main kaolin importing countries in India are Ukraine, UK, Germany, China and Iran. On the other hand, Kerala Ceramics executive told that about 15 % of the total Indian demand comes via imports.

AC 20-4

03/08/2020 09:31:30

asian ceramics

News Anaylsis

News

asian ceramics

COVID contraction for Italian tech The Italian ceramic and brick machinery and equipment sector has returned to the turnover levels of 2013, closing 2019 with revenues of 1.73 billion euros. After five years of record growth that had seen Italian manufacturers reach a turnover of more than 2.2 billion euros, the signs of a slowdown that had already emerged the previous year intensified in 2019, leading to a 19.8% drop in volumes. This decline was a combined result of the expiry of the Industry 4.0 tax incentives in Italy and the slowdown in international construction sector investments. Ten years on from the disastrous year 2009 when the sector abruptly lost more than 30% of its revenues, this niche segment of the Italian mechanical engineering industry, 73% of which is dependent on foreign markets, is now facing a second severe contraction. In particular, it suffered a more than one fifth decline in exports, which slumped by 20.4% to 1,262 million euros in 2019. Meanwhile, the decline in the Italian market amounted to -18.3%, corresponding to a domestic turnover of 468 million euros. One positive aspect is the fact that employment has remained stable, rising by one percentage point in 2019 despite the slump in turnover and the consolidation of the sector’s manufacturing structure. 70% of activities are concentrated along the Via Emilia, in particular around the Sassuolo ceramic tile district, while the provinces of Bologna, Modena and Reggio Emilia alone account for over 80% of the total employment and turnover of the sector, which despite the economic difficulties maintains its world leadership. “From the indications at the end of 2018 we were already expecting a decline in volumes, although not of this magnitude, especially after the significant technological investments driven by the Industry 4.0 incentives,” said Acimac’s outgoing chairman Paolo Sassi. “The weakness of the global construction industry isn’t helping us and now we also have to deal with the effects of the Covid-19 emergency and the lockdown, which have impacted our manufacturing operations and disrupted world trade. We are counting on a rebound effect next year and in 2022.”

AC 20-4

Exports decline

Exports have always been the sector’s main strength but in 2019 saw an even worse decline than in 2018, dropping by 20.4% year on year to reach 1,262 million euros, 73% of total turnover. The European Union remains the Italian ceramic machinery industry’s most dependable market with a very small decline in sales (-0.9% on 2018) and has also confirmed its role as the top export destination with a 28.8% share of total exports (363.8 million euros). And while exports to Greater China (China together with Hong Kong and Taiwan) fell by a half in the space of twelve months (at 63.5 million euros, the region dropped to eighth place in the market rankings), the rest of Asia (“others Asia”) climbed to second position with 186.7 million euros in exports (14.8% of the total) despite a 21% decrease compared to the previous year. Africa rose to third place with 12.5% of total exports and a turnover of 157.7 million euros (-15%), while South America recorded 2.9% growth in 2019 and a sales volume of 143.4 million euros to become the fourth largest market. Non-EU Europe saw a 43% decline to 135.4 million euros, or 11% of total exports, dropping to fifth place from second in 2018. The Middle East likewise saw a contraction (-31.3%), falling to sixth place with a volume of 122.1 million euros (9.7% of the total). In contrast, North America rose by one position to seventh place despite an 18.4% fall in turnover to 87.9 million euros. Oceania played an increasingly marginal role with just 1.3 million euros of exports (down 53% on 2018).

Client sectors

Despite the severe decline (-21.2%), the tile industry remains the leading client sector for the Italian ceramic machinery manufacturers and accounts for 85% of total turnover and a total value of 1,471 million euros. The sanitaryware machinery market remains in second place with sales of 84.5 million euros (compared to 106.7 million euros in 2018). Despite registering a 20.7% decrease on an annual basis, it is the only sector that last year

saw a significant expansion in the domestic market (+15.2%), offset however by a bigger decline in export sales (-24.1%). The heavy clay machinery manufacturers ranked third with a turnover of 80.5 million euros (8.4% of the total) despite a further 11.1% contraction. In fourth position with a turnover of 60.9 million euros is the refractory machinery sector. With 10.4% growth in turnover compared to 2018, it remains the most dynamic client segment. The tableware industry saw a 21.1% reduction in turnover to 23.7 million euros, 97.5% of which was generated by exports. Although the technical ceramics sector marked up 9.3% growth, its 9.5 million euro turnover accounted for less than one percentage point of overall export sales. Among the various types of machines, digital and green technologies registered particularly strong growth as a result of investments in environmental sustainability: digital decoration systems +4.8% (turnover of 164 million euros), purification systems +10.5% (36.2 million euros), quality and process control machines +27.1% (17.2 million euros) and laboratory instruments +9.9%. While the structural consolidation underway in the sector bodes well for the future (the average number of employees per company has risen to 49.4), there continues to be an excessively large disparity in terms of profitability between small and large companies. Half of the companies in the sector (70 out of 141) account for just 5.1% of total turnover, while the 18 companies with revenues of more than 10 million euros generate 80.6% of the total turnover and almost the same share of exports. All categories of companies suffered a severe decline in volumes in 2019, resulting in a 20% fall in average turnover per employee, although more structured companies have a three times higher profitability than that of micro companies. Companies with revenues above 10 million euros reported a turnover per employee of 304,000 euros compared to the 104,000 euros of companies with revenues below 2.5 million euros.

www.asianceramics.com

STAY ONE STEP AHEAD Now more than ever, you need to explore new paths with a leader company in the ceramics sector.

walk with us! https://stayonestepahead.esmalglass-itaca.com

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

SPECIAL REPORT

Coming out of Covid Mota Ceramic Solutions in the spotlight Mota Ceramic Solutions (MCS®) is a 1.5 Mt, EUR 50 million turnover multi-mineral Portuguese mining Group focused on supplying clays, kaolins, ceramic bodies and feldspar to the global ceramics industry. MCS® is recognized as the only international raw material supplier with a broad portfolio of mineral resources in one country – Portugal. It also derives almost 30% of its revenue from export sales to countries, and regions of the world, that include Spain, Turkey, Italy, UK, France, Poland, Middle East, Asia, South America, North & Southern Africa. Brendan Clifford, Co-CEO with Sofia Batista, gives his view on the challenges facing the industry as a direct result of COVID-19. AC: How is MCS® coping during the present crisis in terms of being able to stay in operation? What is your current status, and what are your plans to get back to full service? MCS: In only a few months the COVID-19 pandemic escalated to an unprecedented worldwide health and economic crisis, which few people expected and even today, the long-term impact remains unknown. Like most companies, MCS® was caught somewhat by surprise and, rather than being able to build on a strong 2020 1st Quarter performance, quickly found itself peering into a ‘fog’ of uncertainty in terms of market demand. From a Health & Safety perspective, priority was given to the wellbeing of MCS®‘s 400-strong workforce and the steps taken - early adoption of compulsory wearing of face masks, tele-working to minimise the presence of non-operational staff on-site and ‘social distancing’ - appear, so far, to have been successful with no reported employee cases of COVID-19. With the exception of a Government-imposed temporary closure of one kaolin production unit, due to a local COVID-19 outbreak in the town where the plant is located, all MCS® plants have continued to operate, albeit at reduced levels, in line with the drop in customer demand. During Portugal’s State of Emergency, like many local ceramic customers, MCS® anticipated employee holidays as soon as demand fell, before taking more decisive measures as part of its Austerity Plan. These steps included temporary employee lay-off’s, discretionary cost reduction initiatives and a freeze on non-essential capital to preserve cash to pay salaries, taxes, and suppliers. At the half-year, we are pleased to report that our approach has been successful, and whilst the Group has seen a year-on-year fall in sales it has been able to maintain a positive operational profit and cashflow position, which we believe puts the business in a strong position to respond, as needed, in the 2nd half of 2020. However, this relatively low drop in overall revenue (<10%), does not reflect the considerable differencies seen in week-by-week customer demand changes or the hetrogeneous nature of geographic, and industry sector demand. Our greatest challenge during these highly volatile times has been how to cost effectively maintain operational flexibility whilst working fewer shifts, but at the same time, be able to ‘dial up’ and ‘dial down’ output, as required - we have never had to make critical decisions with so little certainty! In terms of exports, apart from a ‘spike’ in some regional freight and container rates over the last 3-months, Portuguese port services have been largely unaffected, and MCS® has been able to continue to

deliver to all export destinations, including our growing customer base in Asia - Indonesia, China, South Korea, Vietnam etc. With some minor organisational changes, as things stand at the moment, we hope to return production to normal, in all operating units and quarries, from August 2020. Obviously, we need to re-visit this decision, if the threat of recession means customer demand falls again in the last Quarter of the year. AC: What changes will there be in the way you operate your business going forward? Will you work more over videoconferencing, or will you continue to travel to meet with your customers personally? MCS: What is certain is that under the current COVID-19 landscape, 2020 will be a significantly different than envisaged at the time MCS® drafted it original Business Plan and some of the changes made to the business will remain in place. I speak for myself when I say that the need to communicate, and interact with customers, suppliers and employees during these rapidly changing times has never been more critical, which means MCS® has had to use technology tools like Microsoft ‘Teams’, to hold video calls, share information and work collaboratively on projects. To engage with customers, particularly in key export markets, with current travel restrictions and time differences, has also required us to rely heavily on our agent network and own local regional staff in countries like Egypt and Turkey. Obviously, technology and our support network have been a great help, but there is nothing like face-to-face communication and we will continue to travel, as required, as soon as it is safe to do so. Unfortunately, technical service and production plant trials cannot be done remotely and require a physical presence. As a forward-thinking Group, what is now of concern to MCS® is what other permanent changes do we need to make in our processes, so we can prepare for threats that could impact ceramic manufacturers, end-users and consequently us as a raw material supplier, particularly the threat of a pandemic-led global recession. AC: Are you concerned that when the industry emerges from this crisis, that there will be a potential negative feeling towards China and/or South East Asia? MCS: I personally do not believe there should be, or will be, any negative sentiment towards China and/or South East Asian countries from a business perspective as a consequence of the COVIDpandemic. I am more concerned about the economic crisis that may result and subsequent loss of jobs that can increase the level of poverty.

“the hardest hit sector has been the porcelain tableware industry in Portugal, Turkey and Poland”

asian ceramics

AC 20-4

www.asianceramics.com

SPECIAL REPORT

Issues related to changes to Group sourcing, and buying strategies, that involve products sourced from Asia, may also be impacted, but this will more likely to be in response to a perceived risk of rupture in supply chains, rather than as a negative feeling towards Asian countries. AC: What sector of the Ceramics industry do you think will be hardest hit by this crisis, and do you have any ideas as to how the industry can "bounce back" quickly? MCS: All sectors of the ceramic industry have, and are expected to continue to be impacted negatively by COVID-19. The unkown is to what extent, and will depend on regional and country-specific factors. As COVID-19 does not seem to be going away anytime soon, as already mentioned, the real threat is a pandemic-led recession, the depth and duration of which are unknowns. From an MCS® perspective, to date, the hardest hit ceramic sector, we supply, has been the porcelain tableware industry in Portugal, Turkey and Poland. This is due to the fact that shops that sell these products have been closed for an extended period and other sales channels, such as hotels and airlines, have also been badly affected. Interestingly, whilst porcelain demand has fallen, stoneware demand has been maintained. We think this is because the key sales outlet for these products tends to be supermarkets and superstores, which have remained open. In terms of sanitaryware, we have seen a slowdown in customer off-take as they have stopped production and reduced inventories, whilst larger global sanitaryware groups have re-distributed production. Finally, and surprisingly, the tile sector, at least within a European context, has been relatively unaffected and demand remained high throughout. In terms of recovery, MCS® is already seeing some signs of increased customer activity, even decisions to work during the summer months, which would normally be their shutdown, but it is MINERALS FOR LIFE still too early to understand if this return to work is to fulfil pre-existing orders, replenish stock, or to meet a real sustainable pipeline of new orders – we will have to wait to see. AC: Are you looking to expand more overseas or will you concentrate more domestically at the moment until the industry steadies itself again? MCS: Whilst MCS®’s growth strategy remains export focused, we do not ignore the importance of the 70% revenue generated in Portugal. Now with COVID-19, the future direction, rate and nature of MCS®’s internationalisation will depend on many internal, geo-political and marketplace factors. Nevertheless, throughout the pandemic, MCS® has continued to export, and overall export revenues have remained robust, despite, as mentioned significant country and sectorial differences. Whilst difficult to generalise, I can report that year-on-year consolidated export revenues, despite all of the issues, are up slightly on 2019. AC: Many people think that exhibitions /trade shows will be virtually impossible for the next 12-18 months because of the numbers of people that would gather. How do you think that will affect your business, and what will you do to ensure that you stay in touch with your customers, old and new? MCS: Having a stand, or just visiting international exhibitions is important for MCS®, but COVID-19 has already resulted, for safety reasons, the cancellation of several key ceramic exhibitions in Europe this year. Within Europe, our participation is motivated more by the fact it provides an efficient meeting point and customer networking opportunity rather than a sales platform. In Asia, where the MCS® brand is less well known, the opposite is true - exhibitions are vital to increase our international visibility, promote our product portfolio and MCS®’s ambition to be increasingly seen as a viable alternative multi-mineral supplier to the global ceramics industry. In short, I believe, the inability of our technical and commercial staff

www.asianceramics.com

to travel, and reduced participation, particularly in Asian exhibitions, such as Vietnam and China in 2020, will affect our business, but by how much is difficult to quantify. However, whilst we are unable to participate in such events, we are increasing our on-line presence and overall marketing spend to raise brand awareness. AC: What changes do you think will stay in place after this lockdown? People have got familiar with cleaner air and water for example... do you think there will be an anti-industrial movement that becomes more prominent? MCS: Mining all over the world is becoming increasingly difficult from a social, environmental and resource availability perspective. Again, whilst every minerals company, and country, face its own unique challenges, there is definitely a growing anti-mining and anti-industrial sentiment. The dilemma is that, at the same time as these NIMBY and BANANA* sentiment grows, manufacturers are under increasing pressure to meet relentless consumer demand for mineral-based products, which form the foundation of today’s modern society. * NIMBY – Not In My Back Yard BANANA – Build Absolutely Nothing Anywhere Near Anybody Unfortunately, many people have little appreciation of the role minerals play in their day-to-day lives, or that mining is the only way to obtain the necessary raw materials, vital to deliver the infrastructure and goods demanded, for example, those increasingly used in renewable technologies - the reality is, if you can’t grow it, you must mine it! MCS® new corporate slogan “Minerals for Life” is meant to remind everyone of the fact that industrial minerals are fundamental to today’s quality of life to which everyone should be entitled. We also appreciate the need for balance and agree that industry players must increasingly adopt sustainability principles to minimise their environmental footprint. Recognising its own obligations, MCS® has taken on the challenge of adopting Circular Economy and Green Sustainable Mining (GSM) principles. We increasingly try to preserve materials, water and energy in line with the United Nations (UN) Sustainable Development Goals (SDG’s) launched in 2015 as part of the EU’s ‘Transforming Our World - 2030’ Agenda. AC: Will you be able to increase your presence in new markets as companies in Europe are forced to remain closed for longer? Will this give you an advantage? MCS: MCS® will continue to service all ceramic industry sectors locally, and internationally, where it believes it can compete effectively, profitably and help customers succeed in terms of their own business goals. I doubt MCS® will be in a position to take advantage of extended closure in Europe in the way you suggest, but we do believe various initiatives, we are taking at this time, will help provide further customer confidence in our capabilities and competencies. AC: Finally, if you could give one message to the Ceramics industry at this very difficult time, what would it be? MCS: Every crisis has an end, and sooner or later, the question will be how will the minerals and ceramics industries be re-shaped by this one? Whilst challenging times remain ahead, and the final post-COVID landscape remains unknown, I know a lot of good work is being done, at all levels, by like-minded individuals, in the minerals and ceramic industries to protect their People, Profits and the Planet. It is important to remain optimistic and maintain strong management resolve to take decisive, if sometimes unpopular measures, at an appropriate pace, and to the level needed, to fight the deadly commercial and economic effect of the virus. Irrespective of COVID-19, it is hoped that the raw material suppliers can increasingly collaborate with ceramic manufacturers to help solve the social, ecological and technical challenges that also exist.

AC 20-4

asian ceramics

Analysis: Vietnam

Trading pla Vietnam as a tableware hub

n Al Jazeera’s program The Stream recently the question was asked ‘How have some countries beaten the Coronavirus?’ one of the countries highlighted was Vietnam. The interviewer asked Ba Linh Tran, a researcher why Vietnam had been successful so far. He explained it was a mixture of top-down policy and bottom-up action. The topdown policy was swift and aggressively actioned. Schools were shut, the country went into Lockdown early. Infected people were quarantined and track & trace was vigorously followed; the military was involved. The interviewer asked if the response was the result of Vietnam having a one-party system and that if you could end up in jail for not following the policy did that explain the success? Ba made an important and telling point, he explained that Vietnam had been a poor country in the past and had been invaded many times over thousands of years & yet was now developing. He said that to the people the Covid-19 crisis was never framed as a Human Rights issue and there was no debate about if you should stay in or wear a mask; for the collective good, for the love of your family and friends you did what was necessary to survive – you didn’t argue about if you should wear a mask or not. Now as Vietnam battles a second wave of infections it has responded resolutely by arranging mass testing, lockdowns, bans on gatherings, quarantine for thousands of people & a task force of doctors and health workers being sent to the worst-hit area, Da Nang. Ba’s comments resonated with me as have visited and done business with Vietnam since 1995 what has often impressed me is the enthusiasm welcoming nature of the people who also see the benefits in cooperation and openness. The history of Vietnam is one of the influences from China, India, Indonesia sometimes invasions and torments. But the important point I think is that the Vietnamese have struggled long and hard

asian ceramics

AC 20-4

for their independence which they do not take for granted. As Ba mentioned Vietnam was a poor country but changes in government policies have led to rapid development – so what happened, and what are Vietnam’s chances of recovering strongly when we finally, hopefully, throw off the scourge of Covid-19? The World Bank States has considered that Vietnam’s shift from a centrally planned to a market economy has transformed the country from one of the poorest in the world into a lower middleincome country. Vietnam is now one of the most dynamic emerging countries in East Asia region. Vietnam’s development over the past 30 years has been remarkable. Economic and political reforms under Đổi Mới, launched in 1986, have spurred rapid economic growth, transforming what was then one of the world’s poorest nations into a lower-middle-income country. Between 2002 and 2018, GDP per capita increased by 2.7 times, reaching over US$2,700 in 2019, and more than 45 million people were lifted out of poverty. Poverty rates declined sharply from over 70 per cent to below 6 per cent (US$3.2/ day PPP). In 2019, Vietnam’s economy continued to show fundamental strength and resilience, supported by robust domestic demand and export-oriented manufacturing. Preliminary data indicate that real GDP grew by about 7 per cent in 2019, close to the rate reported in 2018, and one of the fastest growth rates in the region.

Population demand

Vietnam has a growing population of 97 million (2018) up from 60 million in 1986 and expected to rise to 120 million by 2050. 70% are under 35 and the middle class is growing; Vietnam needs construction and that needs sanitaryware and tiles. Houses need tableware and more affluent populations want to enjoy the benefits of consumerism. Vietnam has a better healthcare system than many Asian countries and better education too. On the negative side demands on power have exceeded the

www.asianceramics.com

Analysis: Vietnam

aces supply and there are great demands on the water supply too. Rapid growth has affected the environment with natural resources such as sand, timber and fisheries could impact long term growth as could environmental impacts due to climate change. Water pollution due to plastic waste is yet another concern as that could impact human health. Once again though the Vietnamese government is taking measures to mitigate and adapt to change. Archaeology has traced ceramics in Vietnam back around 6000 years and as it developed it was heavily influenced by China and also India, Champa and Cambodia. Acquiring over time a distinctly Vietnamese character. Most countries have a history of craft and artisan ceramic ware and when I first visited Vietnam in 1995 the garden ceramics were still a large part of the nascent ceramic industry the other being a couple of tableware factories – not now – the tile and sanitaryware industry has grown in line with the expansion in construction. AC spoke with industry veteran Hoang Giang of Vien Thien Industrial Supplies Joint Stock Company (VITIS JSC) a company created in 2003 and whose success has reflected that of the Vietnamese ceramic industry as a whole.

In the spotlight

In a bid to get the inside track, AC turned to Mr John Hoang Giang of VITIS JSC and asked his views on not only the country’s ability to serve as a trading centre, but also as a manufacturing hub of growing importance.

www.asianceramics.com

AC: In the last few years, Vietnam has emerged stronger than many of its SE Asian neighbours - what do you think the reasons are behind that? John Hoang Giang (JHG): That’s an interesting question. For many years, investors have been amazed at the transition of Viet Nam from a centrally planned into a market economy, from one of the poorest in the world into a lower middle-income country. Viet Nam, currently it is one of the most dynamic countries in Southeast Asia. Viet Nam’s economic transformation during the last 30 years has been nothing short of remarkable. I can cite some statistics that showcase our country’s dynamics: • 2018 GDP growth reached 7.08% - the highest since 2008; • 2018 import - export quadrupled to nearly US$480 billion since our accession to WTO; • With more than US$19 billion, foreign direct investment (FDI) disbursement for 2018 was the highest in a decade, to name a few. According to PwC’s 2018 APEC CEO Survey, Viet Nam continues to be the No.1 investment hotspot with a net 46% of business leaders in APEC planning to increase investments in our country in 2019. A survey conducted by VCCI revealed that nearly 56% of foreign firms plan to expand their operations in Viet Nam. The country’s dynamism is also evident in its active international integration and strong support for global free trade. To date, we have signed and joined 13 free trade agreements (FTAs) and

AC 20-4

asian ceramics

Analysis: Vietnam

are negotiating an additional three. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) which came into effect early 2019 and the ratification of the EU-Viet Nam Free Trade Agreement (FTA) in 2020. The new-generation FTAs will help Viet Nam’s further integrate into the regional and global supply chains, expand its exports markets, and offer even more potential to investors. Furthermore, with a young population that is continually improving their knowledge and skills, Viet Nam has great potential to advance to the next levels in the global value chains. Government’s commitments to creating a more favourable environment for business. For instance, the term “Enabling Government”, coined by the Vietnamese government a few years ago, is still one of the key philosophies that Viet Nam adheres to. This is reflected in the government’s on-going efforts to align the country with international standards and practices.

Key drivers

Stable and high growth economy: Viet Nam is among the fastest-growing economies in ASEAN and is poised for robust growth, projected to expand at 6.4% annually between 2018 and 2022, according to Moody’s Investor Services. International organizations such as the World Bank and ADB have praised Viet Nam for the stable growth of the macro-economy. Strategic location: Together with other factors such as favourable demographics, political stability, Vietnam has been becoming an attractive destination in South East Asia for foreign investors. Located next to China, Viet Nam’s proximity makes it an ideal alternative location for investors seeking to diversify their supply chains from China. Investors can limit interruptions or delays to existing supply chains in China. A young and growing workforce: Viet Nam is well known for its golden age structure with more than 52% of people in working age and about 97% of the working-age population is literate, according to the Ministry of Education and Training. The government has taken steps to meet the demand of high-skilled industries, including increasing vocational and technical training. In 2018, there were more than 1,900 vocational training centres across Viet Nam. Cost competitive production base: Labour costs in Vietnam are lower than the rest of Asia. An ideal production base for companies thinking of shifting or diversifying out of China Increasing integration into the global economy: Vietnam officially became the 150th member of the WTO on 11th January 2007 as a result of continuous efforts to improve the investment environment, market liberalization and the nation’s GDP growth rate. Vietnam's economy is forecast to reach an optimistic growth thanks to the benefits of shifting production due to the prospect of new agreements such as CPTPP ( Comprehensive and Progressive Agreement for Trans-Pacific Partnership and other FTAs; Vietnam has also signed, and is negotiating, a variety of bilateral and multilateral trade agreements with other nations and regions Thanks to this regional and international cooperation, foreign investors in Vietnam may enjoy more favourable conditions when doing business here. A remarkable milestone EVFTA EU Vietnam Free Trade Agreement and EVIPA EU Vietnam Investment Protection Agreement between EU and Vietnam have just been signed on 30 June 2019 Legal framework internationally adapted: The accession of Vietnam to the World Trade Organization has provided a boost to the domestic economy However, it also forced Vietnam to launch

asian ceramics

AC 20-4

ARTISANS FROM CRAFT VILLAGES ARE INSTRUMENTAL IN ENSURING PRODUCTS HAVE UNRIVALLED WORKMANSHIP a wide variety of reforms regarding policies and laws in line with WTO principles, especially in the areas of investment and trading in goods and services Foreign Invested Enterprises (play a key role in the development process of Vietnam FIEs are an effective force contributing to economic growth, by improving the balance of payments, promoting technological innovation, introducing modern business management methods, creating jobs and bringing competitiveness to the market FIEs accounted for 70 of total export value in 2019 A large market with increasing purchasing power and an emerging middle class: domestic demand has been constantly increasing. With a population of about 95 million, ranking 14th in the world, Viet Nam has enormous market potential to various types of business investment. According to PwC’s World in 2050 report, Viet Nam is forecast to be among the Top 20 economies in the world by 2050. Continuously improving infrastructure: Viet Nam is investing heavily in infrastructures, such as highways and seaports, to provide an efficient business environment for investors. From 2012 to 2016, Viet Nam’s infrastructure spending growth was among the fastest in ASEAN, at 11.5% p.a., nearly double its GDP growth. This has helped boost the country’s World Bank Logistics Performance Index ranking in 2018 by 25 spots to the 39th position among 160 countries, putting Viet Nam ahead Malaysia, Indonesia and the Philippines. There is plenty of room for further investment in high-tech industries, financial services, tourism and even modern agriculture. Supporting incentives have been offered in forms of tax or land rental schemes to encourage more investments in high-tech, green industries, non-polluting sectors and value-added services. AC: With capacity in all-ceramic types expanding rapidly, is there a danger that Vietnam's current oversupply situation will suppress future expansion, and what impact will it have on product pricing? John Hoang Giang (JHG): The situation of domestic production now is supply above demand for ceramic products and so competition among ceramic producers is getting tense at the same time many big companies still invest in expanding capacity, even new investment. It is expected that the output of ceramic tiles will increase by 5.8% in 2019-2020 (equivalent to about 50 million m 2;

www.asianceramics.com

Analysis: Vietnam

sanitaryware will increase by 7%- 10 %, (about 2 million pieces) Domestic consumption will increase by 7%- 8% reaching about 580 - 600 million m 2 The export value will increase by about 20% reaching about 550600 million USD (including tiles, sanitaryware and raw materials) Import value will increase by about 5% reaching about 450-500 million USD To deal with this situation, Vietnamese ceramic companies are forced to improve quality, diversify their designs and expand their export markets, enhancing production management to minimize costs, updating modern technologies and equipment to ensure quality and increase the competitiveness of products, building brand names in the domestic market and export markets in all over the world. Even though a price war in the domestic market is predicted unavoidable shortly and a merger and acquisition trend could happen afterwards. AC: In the tableware sector, the country has a long tradition in places such as Bat Trang for producing high-quality porcelain, but the relative number of larger-scale companies is still far behind China. Does the country consider it has a chance to become a regional hub in this sector and a global supplier? John Hoang Giang (JHG): Vietnam has gained worldwide prominence as a key supplier of ceramic and porcelain products that boast superior quality in terms of aesthetics and construction. Models from the country combine traditional styles with modern design elements, helping the industry carve a niche for itself in the global market. Skilled artisans from numerous craft villages throughout the country are instrumental in helping ensure that products feature unrivalled workmanship. These stylists are usually complemented by in-house design teams that gained professional training and experience from prominent art schools and have been cooperating with buyers for a long time. The stable domestic availability of raw materials is another key advantage enjoyed by the line. Various types of clay are procured from several provinces, with some of these locations being important sources of high-grade kaolin. The clay mining industry helps ensure a steady supply of raw materials. Regular and white clay are extracted by 184 and 39 quarry operators, respectively. Combined, they excavate roughly 1.5 million tons of the material every year. Several companies are starting to concentrate on the highend segment and paying more attention to product quality. Some are releasing table and cookware designed to meet FDA requirements. Other suppliers are improving construction by moving away from traditional manufacturing processes and obtaining better equipment such as electric and gas kilns and fully automated production lines. Currently, there are 10 tableware manufacturers in Vietnam (see attached list) with industrial scale and cutting-edge advance technology & equipment, adding up to a total capacity of approx. 230 million pieces per annual. However, only two of them, MINH LONG I and CHUAN KOU (who have constantly participated at the Ambiente Fair in Frankfurt over 20 years), might be considered as international players. Minh Long 1 dominates the high-end & upper-mid-end segments whilst Chuan Kou holds the upper-mid-end segment & specially restaurant & hotel ware while Hapoco and all others stay strongly at the midend segment. All others seem to be very much focusing on the domestic market at the medium - high-end segment. With all its above-said strengths, we believe that the country could consider it has a chance to become a regional hub in this sector and a global

asian ceramics

AC 20-4

supplier in the future. AC: Is the future for Vietnam-made tableware as branded product, or OEM? What are the benefits for companies looking to either source from the country, as opposed to elsewhere in the region? John Hoang Giang (JHG): There are absolutely two Vietnam -made branded tableware products under MINH LONG I and CHUAN KOU exist in the regional & global markets for over 20 years. At least three out of the 10 local tableware manufacturers in the list already have OEM contracted with international buyer groups like Ikea, Hema (Germany); Wilkinson, Matalan (UK); Pier 1 (US) since early years of 2000. (See company profile of Dai Hong Phat attached). As China's production and export of ceramic tiles/sanitary/ tableware are increasingly difficult due to trade war with the US and tax policies issued by other countries in the world, outsourcing and OEM production will take place outside China Chinese manufacturers are predicted to take advantage of Products Made In Vietnam for export so the existing manufacturing facilities of Vietnam will be under consideration for OEM production and help to maximize capacity (including Tableware/sanitaryware/ and ceramic tiles) Vietnam sourcing is becoming increasingly attractive as an alternative to China, Indonesia and Thailand for low-cost consumer products, particularly garments and furniture, and to India for I.T. and other outsourced services. Vietnam offers a talented and

www.asianceramics.com

Analysis: Vietnam

willing workforce and is a relatively politically stable environment. It year Minh Long spends more than 100 billion VND to import modern is generally accepted that Vietnam sourcing benefits from a strong machinery and equipment from Germany, France, Italy, Japan ... to work ethic of the Vietnamese and their commitment to quality. replace and improve old equipment to reduce production costs and The workforce is highly literate, willing to learn and trainable lower prices. finished products. After more than two years of research despite a poor education. It has been shown that they are better and investment in innovation, Minh Long 1 launched 250 Lys Horeca in protecting intellectual property such as patents and trademarks brands for the restaurant and hotel segment. than some other low-cost countries. MINH LONG I with the new expansion of bone china project AC: For a prospective investor, what would be your CHUAN KOU has constantly upgraded its production facilities in assessment of the conditions for establishing a new greenfield Vietnam factory and in what sector of tableware would you consider it AC: Companies such as IKEA have used Vietnam for many years to be most required? as a supplier of course, but product prices tend to be relatively John Hoang Giang (JHG): Conditions for establishing a new low. Does Vietnam have the ability to punch a heavier weight on greenfield factory: the international market and provide higher grade products at a i. Production Technology: greater price? a) Source of technology: country of origin of the technology, John Hoang Giang (JHG): As a widely accepted rule, OEM the year the technology was introduced, international standards of Manufacturers are not in the right position to add value in their technology. products branded under supply chain outlets. However, we b) The completeness, modernization, novelty, appropriateness strongly believe thereâ&#x20AC;&#x2122;s a high possibility to improve export prices of the technology, and the options for technology. of Vietnam-Made tableware products in the international markets c) How to implement technology transfer under the current when local manufacturers can improve quality, diversify their provisions of the law (if any), requiring information on technology designs and expand their export markets, enhancing production transfer contracts, the content of technology transfer, the value of management to minimize costs, updating modern technologies contracts, patents, duration and equipment to ensure quality and increase the competitiveness ii) Manufacturing machinery and equipment of products, building brand names in the domestic market and iii) Consumption of raw materials, fuel, chemicals, components and export markets worldwide. Spare parts iv)Products and production Sanitaryware manufacturers capacity (the product quality, superior features, value-added, Company Name Location Ownership Design Capacity degree of environmental (pc/year) friendliness and the ability to LIXIL VIETNAM CORPORATION (Inax) NORTH FDI 3,500,000 replace imported products.) BRANCH OF LIXIL VIETNAM CORPORATION in SOUTH FDI 700,000 v)Forecasting market demand Binh Duong province (Ex: ASVN) (domestic and foreign market), taking into account the similar TOTO VIETNAM CO., LTD. NORTH FDI 1,500,000 products, the reliability of the TOTO VIETNAM - HUNG YEN BRANCH NORTH FDI 1,200,000 forecasts) VIGLACERA THANH TRI SANITARY WARES CO. NORTH State-owned 500,000 vi) Research and Development (R&D) VIGLACERA VIET TRI JSC NORTH State-owned 450,000 vii) Standard management CERAVI JOINT STOCK COMPANY NORTH JSC 450,000 System HAO CANH PORCELAIN PRODUCTION & NORTH Private 2,000,000 viii) Environmental Evaluation TRADING CO., LTD. ix) Cost structure x) Labour and Training LONG HAU PORCELAIN JSC (VINALOHA) NORTH PTE 400,000 AC: What sector of tableware THANH HAI SANITARY WARE CO., LTD. (SITON) NORTH PTE 300,000 would you consider it to be most DONG LAM SANITARYWARE COMPANY NORTH PTE 1,000,000 required? (DOLACERA) John Hoang Giang (JHG): TOKO VIETNAM NORTH PTE 2,000,000 Export-oriented tableware products produced with the latest technology TBV VIETNAM JSC CENTRAL PTE 450,000 i.e. Tableware Ink-Jet; Reactive VIETNAM CAESAR SANITARY WARES JSC SOUTH FDI 1,500,000 glazed tableware was the next VIGLACERA BINH DUONG SANITARY WARES SOUTH State-owned 450,000 generation coming up after handCO. painted products. AC: Do you know of any VIGLACERA MY XUAN SANITARY WARES CO. SOUTH State-owned 750,000 expansions or upgrades currently THIEN THANH SANITARY WARE JSC SOUTH PTE 600,000 scheduled - or underway - in the MINH TIEN PORCELAIN CO., LTD. SOUTH PTE 200,000 country's tableware sector? What do you estimate current capacity OTHERS (SMALL) (NORTH) 2,000,000 to be? TOTAL 19,950,000 John Hoang Giang (JHG): Each

asian ceramics

AC 20-4

www.asianceramics.com

The Biggest Zircon Processing Center in Europe Permanent Stock of a Wide Product Catalogue optimized for Ceramics Processing Zircon Sand into Flour and Micronised forms since 1976 Located close to Valencia Port, Spain Excellence in Quality Personalised Customer Service

Get to know our products at mariopilato.com

Trusted raw materials Valencia, SPAIN | +34 963 393 270 | mpb@mariopilato.com | mariopilato.com

Analysis: Vietnam

AC: What other international brands are currently looking to Minh Long 1 currently has been dominating the high-end source from Vietnam that you are aware of, and why do you segment, Chuan Kou holds the mid-end segment, while Hai think they may choose the country over the likes of Indonesia Duong Hapoco stays strongly at the upper mid-end segment. or Thailand or Bangladesh? Although Chinese ceramics, especially Jiangxi ceramics John Hoang Giang (JHG): Ikea, Hema (Germany); Wilkinson, are currently occupied in many market places, with proper Matalan (UK); Pier 1 (US); Home Depot (US) investment and strategy, local branded-products are gradually For the reasons, I outlined in Question 4. regaining this important market. AC: Measures have been in place against Chinese products So, things look promising for Vietnam Ceramics even factoring so what effect have these had on the sector and how will they in the situation with Covid-19, AC then asked another very continue to support it in the coming two years? Tableware capacity experienced industry veteran for his views. John Hoang Giang (JHG): According to statistics, the total revenue of the household ceramic market in Vietnam reached about 5,600 billion VND, but domestic production only accounted for 30%, the Capacity No Company Name Location Ownership (Million pc/year) remaining 70% belonged to overseas producers, most of which are Chinese. 1 MINH LONG I CO., LTD. SOUTH Private 45.00 “Chinaware” for many years has been haunted by domestic manufacturers FDI 2 CHUAN KUO CERAMICS CO., LTD. SOUTH 50.00 being border-traded and distributed in all (Taiwan) provinces and cities, from the North to 3 CUONG PHAT CERAMICS CO., LTD. SOUTH Private 10.00 the South, existing at almost every family from urban to rural areas. Local tableware 4 HAPOCO (HAI DUONG PORCELAIN JSC) NORTH JSC 25 manufacturers acknowledged that domestic ceramic products for many years 5 CHU DAU HAPROSIMEX CO., LTD. NORTH JSC 28 lost to Chinese goods because production HAO CANH PORCELAIN PRODUCTION & facilities were mainly developed based 6 NORTH Private 30 TRADING CO., LTD. on craftsmanship, fragmentation and outdated technology except Minh Long 7 LONG PHUONG TABLEWARE CO., LTD. NORTH Private 30 1 and Chuan Kuo Vietnam (CK) heavily invested in production equipment with 8 OHIO Ceramic Technology Co., Ltd. NORTH Private 10 modern technology and large-scale TOTAL 228 production lines.

From the raw side…

So, things look promising for Vietnam Ceramics even factoring in the situation with Covid-19, AC then asked another very experienced industry veteran for his views, namely the hugely experienced Richard Leonard, Business Development Director, Asia Material Resources Limited. I think Vietnam has benefited from the willingness of the government to allow more open investment by foreign companies with attractive offers, the need for Vietnam to compete in the world market and the conversion of state-owned companies to Joint Stock Companies with free-market activities. However, there has been an oversupply of tiles for some years now; hence closure and downsizing of some factories. Sanitaryware production expansion at TOTO happened a couple of years ago and this was mainly to offset any potential challenges from China production. LIXIL took over American Std. and kept some of their former INAX factories closed. Two or three local companies started such as Hao Canh & Dolacera to improve their quality as a result of the freeing up and Joint Stock status to better compete. The only expansion in tableware that I can recall has been at Minh Long 1, probably the best porcelain manufacturer, who then wanted to delve into Bone China a process they are still pursuing being nearly in full production. Thinking about the craft style well Bat Trang has been a traditional local craft ware/souvenir district for domestic and tourist consumption – a bit like Lampang in Thailand or Khurja, Uttar Pradesh in India – but maybe some of them want to look at taking

asian ceramics

AC 20-4

the production to another level to make them more competitive and desirable. Companies like Wedgwood though skipped Vietnam for India & Indonesia – at the time Vietnam wasn’t as advanced, it would be more attractive now but it is rare for tableware companies now to invest in factories on the ground when outsourcing gives more flexibility. Let us not forget that many outsourcing companies have customers who do not want to buy products from China, an increasing trend. Therefore, Vietnam is a good option with educated and hardworking workers. So, I would imagine more international brands will be interested in looking at Vietnam as an investment option and it is easier to deal with Vietnam than with China with its internet firewall and various blocked web sites never mind its poor accountancy practices and opaque legal systems.’ To summarise though Vietnam has been hit by Covid-19 like every country has it has used swift and strenuous efforts to minimise the impact on health and economy. We can speculate that the national character and the governance system has facilitated that and though the crisis isn’t over at the moment like Taiwan, Vietnam sets a shining example of how to handle a crisis. The ceramic industrial sector has grown magnificently over 25 years and though there have been challenges and occasional setbacks, again there has been determination and endeavour to overcome and prosper if it is to continue to evolve and progress it is well placed to emerge from the Covid-19 in good health and possibly take a premier place in global ceramic supply whether materials or end products.

www.asianceramics.com

Analysis: Kiln furniture

Holding fir COVID puts the brakes on kiln furniture In a year that had started so positively, 2020 will be long remembered by the expanding kiln furniture sector as one that put an instant halt to progress. With output from the whiteware sector in massive decline this year, Jahir Ahmed looks at how suppliers of this integral part of the production process are putting strategies in place for the “new normal”…

sia was enjoying a stable growth of ceramic kiln furniture before the disastrous outbreak of COVID-19 that has impacted its production and trade. Many of the consuming industries have stopped or reduced operations in post-lockdown labour-shortage and lower demand, as the economy of some of the major regional consuming countries, such as, China, India, Indonesia, Thailand, Vietnam and others, is badly in trouble and struggling hard to restore. Observes India’s leading kiln furniture, refractory and industrial ceramics manufacturer, M. M. Murugappan, Chairman of Carborundum Universal Limited (CUMI), about India and others, “Though the economy was poised for a modest rebound, the outlook continued to be fragile against the backdrop of rising debt and declining productivity.” He said, “The growth in emerging and developing economies was expected to be better with India remaining one of the bright spots. However, the onset of the COVID-19 has caused the deepest global recession in several decades. While the ultimate outcome is still uncertain, the pandemic is expected to result in contractions across economies causing lasting damage to labour productivity and potential output.” However, the uses of kiln furniture and other refractories have increased in recent years due to expansion of the developing economies where consumption of ceramics have greatly increased. According to the rough estimates made by the researchers, 10-12 percent growth in ceramic manufacturing is expected in next half a decade because of rise in consumption of traditional ceramics worldwide, boosting up demand for kiln furniture. Meanwhile the uses of kiln furniture have diversified in the main ceramic producing region of Asia that resulted in use of new and innovative cost-effective and lighter kiln furniture. Use of low temperature firing kiln furniture has increased in Asia in an effort to

asian ceramics

AC 20-4

reduce cost of production, and also, in some countries, consumption of high temperature alumina kiln furniture has also increased, according to the US based market researchers, Credence Research Inc.

An expansive past

Due to rapid expansion of consumer and industrial product industries in Asia in recent years, the use of kiln furniture has also increased manifold in other factories, including those of the production plants of construction materials, communications technologies and transportation vehicles. India, China, Vietnam, Malaysia, Philippines, Bangladesh and other emerging economies have showed great potential in almost all sectors of manufacturing. According to Murugappan, despite being a challenging year both in India and globally, his company’s ceramics business recorded a 4 percent growth over the previous year. The industrial ceramics business comprising, technical and wear ceramics is largely export driven. Focused marketing efforts, penetration into new markets and servicing a global customer network cushioned the business from the adverse effects of the pandemic and economic slow-down. In kiln furniture production and supplies, together with CUMI, the global players, US based Saint-Gobain, Imerys Ceramics of France and many other worldwide suppliers including regional majors, such as, Beijing Trend Industrial Ceramics of China, based in Beijing, are increasingly active to grab the emerging markets through various innovations as well as research and development. The suppliers are wooing the customer industries in Asia with products most matching to their needs. ASEAN ceramic industry researcher, Tran Van Can, based in Hanoi of Vietnam, told Asian Ceramics the suppliers of kiln furniture need to be more customer friendly to supply well-tailored easy to handle materials to suit the needs of the customer’s firing. “The customers need real functional kiln furniture to meet their real requirements,” said Can, who is the Director of Ceratec Centre for Science and

www.asianceramics.com

Analysis: Kiln furniture

Technology and Vice Secretary General of Vietnam Building Ceramic Association (VIBCA). The ceramic manufacturers are making efforts to reshape the usage of traditional architectures of kiln furniture settings in firing their products in the kilns under their own recipes, not always familiar to the suppliers of traditional kiln furniture. In Vietnam, said Can, about 30-50 of the required kiln furniture are procured locally and they include self-made products manufactured in-house. He said the rest of the requirements are imported. The ceramic industries are no more buying materials less matching, rather, they are seemed to be interested in sharing experiences in developing materials locally, he added. Imerys, Beijing Trend, Saint-Goibain, all claimed to have generated lighter, thinner and cost-effective customized kiln furniture components for reduced heat capacities, without compromising on service length. With Asia’s largest single-site producing cordierite kiln furniture systems, Beiing Trend said its Asian markets will be provided with a diverse range of products. To offer the better flexibility of choosing complex secondary kiln furniture, particularly to the tableware manufacturers, Beijing Trend is expanding its ranges of solutions. It has strong presence in all major regional markets with tailor made products. Beijing Trend’s products are competitive in the domestic and export markets both in terms of quality and prices. Its extruded butts with holes have high standard of flatness and dimensional accuracy. The company claims its extruded butts are now amongst the leading products in the ASEAN, as well as in the domestic market. Its kiln furniture are used in almost all sectors of traditional ceramics

GROWTH IN EMERGING ECONOMIES WAS EXPECTED TO BE BETTER THIS YEAR from potter to heavy clay, but it is mainly applied in the sanitarware manufacturing. The butts’ weight reduction of 35-50 percent and its expansion of load capacity are attractive. The company claims its 33mm thick extruded batt has the same weight as a 23mm thick pressed butt of the same size and it can bear five times the load. Saint-Gobain said its LO-MASS kiln furniture products exhibit high thermal conductivity and low thermal mass which translates to greater efficiency throughout an extended number of use cycles. This enables process engineers to reduce ongoing material expenses due to regular kiln furniture replacements, product defects, and reworks while simultaneously improving thermal efficiency, therefore reaching superior levels of productivity. “LO-MASS engineered components include setter plates, support posts and stringer beams, post mounting shoes and structural

ABREF kiln furniture. Photocredit, ABREF

www.asianceramics.com

AC 20-4

asian ceramics

Analysis: Kiln furniture

tie systems. Numerous other custom shapes and engineered assemblies are available to provide flexible setting configurations, decreased setup time, as well as system safety and stability,” claimed Saint-Gobain.

ASEAN rivalry

With arrival of new generation kilns, the kiln furniture consumption in the ASEAN countries are becoming more diversified. To cope with the changes, and in its efforts to expand business, Asia’s leading kiln furniture supplier IKF Thailand (Imerys Kiln Furniture (Thailand) Co Limited), a subsidiary of Imerys, has to look for newer markets outside East and Southeast Asia. IKF is already exporting to other regions, in addition to supply to its major regional target market of ASEAN, where the Chinese kiln furniture have expanded market share. However, IKF’s premier market, China, through Hong Kong, continues to be the largest buyer. At least a dozen of Chinese kiln furniture manufacturers are well aware of the demand of the ASEAN and other Asian markets and they maintain close contact with the buyers to provide tailor made materials at a price much lower than the Western brands. Among them, Beijing Trend is the most comprehensive manufacturer and market leader. Because of the suitability of the users, Thailand’s Patra Refractory Company Limited, located in Nongkhae, Saraburi, has emerged as a major supplier of kiln furniture with considerable influence in the ASEAN region. Its annual combined refractory production capacity is 30,000 tons to manufacture a lot of pieces of kiln furnitures and refractory bricks. Patra claims it has been producing its light weight kiln furniture according to the specific requirements of the Asian, especially, ASEAN customers. The half a century old refractory operator said it has been exporting well customized light weight kiln furnitures to its vital target markets of Vietnam and Indonesia. It claims the products are competing strongly against the Chinese products. Patra’s setters, supports, monolithics and refractory bricks, especially, of light weight, are easy to handle and energy saving. The products have demand in many Asian countries from Japan and Australia to the Middle East and Europe, where the customers use the materials in shuttle and tunnel kiln firing for manufacturing tablewares, tiles, sanitarywares, gift and decorative items, figurines and other kinds of ceramic art pieces. According to Patra’s Deputy Managing Director Phadet Darote, some 70 percent of its production is consumed domestically.

Growth momentum

Despite presence of all the global and regional kiln furniture majors in India, one of the world’s largest markets, Murugappan said, his company, CUMI, is doing well domestically with competitive innovation in quality, while a substantial part of CUMI’s kiln furniture, refractories and industrial ceramics are exported to around 50 countries worldwide, covering all the continents. He said, the growth momentum in CUMI which was initially impacted by the slow-down in the automotive and other core industries during the financial year 2019-20, was on a rebound when the pandemic struck. While the impact caused a 7 percent decline in the standalone revenues for the company, the geographical diversification of operations aided in reducing the decline to 3 percent at the consolidated level. The Chennai (in Tamil Nadu state) headquartered CUMI was founded in 1954 as a tripartite collaboration between the Murugappa Group, one of India’s major industrial and commercial concern

asian ceramics

AC 20-4

NGK Adrec Co Ltd (NGK Group) Location: Mitake Town, Kani District, Gifu Prefecture, 505-0112, Japan Products: Ceramic kiln furniture and refractories Markets: Domestic and export markets Others: NGK exports kiln furniture to the global markets, mainly in Asia. NGK has a subsidiary plant in Thailand.

Saint-Gobain KK Location: 26 Shimojinyachō, Seto Aichi 489-0051, Japan Products: Ceramic kiln furniture and refractories Markets: Domestic and export markets Others: Saint-Gobain kiln furniture are exported worldwide. Saint-Gobain’s other Asia based production plants are located in China and India.

Imerys Kiln Furniture (Thailand) Co Limited (IKF) Location: Ta Luang, Saraburi, Thailand Products: Ceramic kiln furniture for all types of ceramic manufacturing Markets: Besides dominating the Thai domestic markets, IKF supplies its kiln furniture to all ceramic manufacturing countries in the Asian countries and others. IKF also exports to all major ceramic manufacturing countries worldwide. It has substantial export markets in East Asia, South Asia and the Middle East including Turkey. Others: IKF Thailand is Asia-based kiln furniture operation of leading global player Imerys of France. It produces both cordierite and silicon carbide in addition to mullite, alumina and zirconia. Imerys Thailand base is its Asia continental operation with headquarters in Bangkok. The Thai base has one of Imerys’ major R&D facilities.

Siam NGK Technocera Co Ltd (NGK Group) Location: SIL Ind Land, Bua Luay, Nong Khae, Saraburi, Thailand 18140, Thailand Products: Ceramic kiln furniture and refractories Markets: Domestic and export markets Others: NGK exports kiln furniture to the global markets, mainly in Asia. NGK Group’s main plant is located in Japan.

Patra Refractory Company Limited Location: Kokeyae, Nongkhae Saraburi, Thailand Products: Ceramic kiln furniture, specially, of light weight. Also, refractory bricks. Annual production capacity: 30,000 tons of kiln furniture and refractor bricks Markets: Domestic and export markets. Outside Thailand, its main ASEAN markets are Vietnam and Indonesia. Also, it exports to some other countries globally. About 30 percent of its production is exported. Others: Patra’s kiln furniture products include setters, supports and monolythics and are shipped to export markets worldwide.

founded in 1900, and the US based Carborundum Company and the Universal Grinding Wheel Co Ltd of UK. CUMI produced materials included, silicon carbide, nitridebonded silicon carbide, mullite, high purity alumina, zircon, zirconia, zirconia-mullite, and insulation refractories, including fire bricks, for various applications. Its kiln furniture and refractory plants located in Ranipet, near Chennai, and Jabalpur, in Madhya Prodesh state, provides total refractory solutions to ceramic industries, manufacturing sanitarywares, tablewares, tiles, insulators, and abrasives. Customised and tailor-made products are manufactured and supplied for usages as kiln furniture, kiln lining, kiln car and others. CUMI's range of industrial ceramics comprises wear and corrosion limiting products and grinding media. CUMI also

www.asianceramics.com

Analysis: Kiln furniture

offers certain value-added industrial ceramic products, such as, engineered ceramics, metallized ceramics and ceramic lined equipment. These products cater to critical and demanding applications in thermal power plants, material handling, coal washeries, cement, steel, floor and wall tiles, paints, food processing, mineral processing, electrical and electronic industries.  The manufactured materials, alumina, zirconia, RBSiC, cumitherm-z (monoclinic zirconia), and aluminium titanate are built to withstand extremely harsh environments with outstanding performance, and have applications as extreme wear and impact resistant- RBSiC, electrical resistant, wear and thermal resistant, wear and impact resistant, wear and corrosion resistant, and wear resistant.

Increased output

Saint-Gobain offers a large selection of silicon carbide, high purity alumina, high alumina-mullite, mullite and zirconia refractory and kiln furniture products. It is the industry leader in the development of silicon carbide materials, which are resistant to oxidation, thermal shock and creep at higher temperatures. It has lightweight advanced silicon carbide kiln shelves for pottery and artwares that result in shorter firing cycles for reduced energy consumption and increased output. Its LO-MASS and other silicon carbide kiln furniture reduce energy consumption, improve flexibility and increase capacity, lower costs and increase output yields in whiteware, sanitaryware and porcelain tableware applications. Saint-Gobain updated its LO-MASS kiln furniture. The company’s high-performance ceramics and refractories pioneer material innovation in challenging manufacturing environments. With decades of experience servicing a wide range of industrial markets, from rugged mining applications to precise high technology sectors, it has claims to have successfully curated a catalogue of performance ceramics and refractories to suit any industrial objective. “Among our core competencies is the ability to design and develop remarkably stable kiln furniture for extreme thermal processes,” said the company. Describing the features of the high-performance ceramics and refractories, such kiln furniture refers to any components within a heating chamber used to ensure that workpieces are heated and cooled uniformly and as homogeneously as possible, irrespective of where they are positioned in the chamber. They are also used to support workpieces and avoid deformation at high temperatures, as well as spacing within batch heating processes to ensure that they do not fuse together.  Typical kiln furniture components include refractory ceramic beams, lug posts, plates, saggers, setters, tables, tile cranks, and so on. However, these largely depend on furnace geometry, said Saint-Gobain. Roller hearths, for example, require high-temperature mechanical conveyors to continuously feed workpieces through a tunnel chamber with several heating zones.  “These are used throughout thermal processes, which means they are routinely fired at extremely high temperatures, thus are subjected to severe thermochemical stress. Consequently, kiln furniture may need to be replaced regularly due to rapid component degradation. This represents a significant ongoing cost. Advanced silicon carbide products of today are engineered to mitigate this issue, taking standard components from mere hundreds of cycles to thousands,” said Saint-Gobain. Usually, additional costs are incurred due to over-utilization of space in the heating chamber by heavy ceramics like cordieritebased products. “Kiln furniture increases the rate of energy consumption in routine thermal processing, which impacts efficiency

asian ceramics

AC 20-4

Saint-Gobain South East Asia operations Location: Thanonphayathai, Ratchathewi, Bangkok, Thailand Products: Ceramic kiln furniture and other ceramic materials Markets: ASEAN countries, including neighbouring regions. Others: Saint-Gobain’s South East Asia operations are part of Saint-Gobain Ceramic Materials, based in Worcester (MA), USA, which develops kiln furniture for marketing worldwide.

Beijing Trend Industrial Ceramics Co Ltd Location: Matou, Huoxian Town, Tongzhou District, Beijing, China Products: Ceramic kiln furniture and other related materials Annual production capacity: 11,000 tonnes of cordierite-mullite products Markets: Domestic and export markets worldwide, with ASEAN region being a major target. Others: Beijing Trend Industrial Ceramics is China’s leading and best-known kiln furniture manufacturer. It has global partnership with IPS Ceramics/Dyson Thermal Technologies (UK) and EmcoTherm (Germany). It produces kiln furniture and refractory materials for traditional and industrial ceramics and others.

Saint-Gobain Advanced Ceramics Co Location: Xinzhuang Industrial Zone, Shanghai, 201108, China Products: Ceramic kiln furniture and refractories Markets: Domestic and export markets Others: Saint-Gobain kiln furniture are exported worldwide. Saint-Gobain’s other Asia based production plants are located in Japan and India.

Jiaozuo Beixing Refractory Co Ltd (BRCC) (Silicon carbide (SiC) products factory) Location: Baishan industrial zone, Jiaozuo City, Henan Province, China Products: Ceramic kiln furniture and other refractory products Annual production capacity: 20,000 tons of SiC products, which included nitride bonded silicon carbide ceramic plate, oxide bonded silicon carbide, reaction bonded SiC kiln series, mullite ceramic sagger, silicon carbide brick, etc. Markets: Domestic and global export markets, including ASEAN region. Others: In ASEAN area, BRCC’s main export markets include Thailand, Malaysia and Vietnam, where shelf board, brace, beam and sagger have good demand. It also offers other refractories.

Fujian Dehua Chuang Jie Kiln Furniture Co Ltd Location: Dehua county, Fujian province, China Products: Ceramic kiln furniture Annual production capacity: 5,000 tons of kiln furniture Markets: Domestic and export markets, including ASEAN countries. Others: Manufacturer known as provincial high-tech enterprise. Cordieritemullite kiln furniture for tablewares, sanitarwares, tiles, etc. ABREF kiln furniture. Photocredit, ABREF

www.asianceramics.com

Economic solutions for sanitaryware production

Guaranteed Energy Savings through efficient firing technologies for Sanitaryware • Tableware • Clinker • Porcelain Stoneware Pipes • Split & Roof Tiles • High Voltage Insulators • Technical Ceramics up to 1.800 °C • Hot

Energy-saving high-output plants for gentle drying

Enhanced quality and maximum flexibility through automatic syphon glazing unit

Perfect plaster moulds through automatic batching and vacuum mixing

Efficient production and highest flexibility with optimised product handling by robots

Lippert GmbH & Co. KG Boettgerstr. 46 D-92690 Pressath Tel.: +49 9644 - 67 0 Fax: +49 9644 - 67 222 Mail: lippert@lippert.de

www.lippert.de

www.KeramischerOFENBAU.de

Phone +49 - 51 21 - 74 74 00 · Fax +49 - 51 21 - 74 74 74 Keramischer OFENBAU GmbH · Benzstraße 5 · 31135 Hildesheim · GERMANY

Analysis: Kiln furniture

and ultimately affects the plant’s bottom line,” the company said.

Performance encounter

Imerys has developed a comprehensive set of high-performance cordierite and SiC kiln furniture solutions for the industries of sanitarywares, rooftiles and technical ceramics and to match the manufacturers of all kinds of tablewares, porcelain, stoneware, earthenware and bone china. “Harnessing our wide portfolio of quality materials and state-of-theart production technologies, our design office is able to tailor any of these solutions to the specific requirements of the customers of kiln furniture,” said Imerys. The Imerys kiln furniture solutions for tableware and sanitaryware guarantee high productivity and profitability of the kiln line, optimized kiln furniture design tailored to the requirements of the customer industry’s product mix enabling optimum setting density and loading rates on firing line in the kiln and automated handling. It also guarantees quality end products, accurate and stable geometry and dimensions to ensure the quality of the tableware and sanitaryware pieces. To lower energy consumption, cordierite and silicium carbide bend-resistant structures keep weight to a strict minimum, while lowering maintenance costs, the simple, stable, light and dry assemblies help reduce overall kiln furniture costs. It ensures long service life through high thermal stability, thermal shock resistance and chemical inertness. Imerys claims it is the only manufacturer able to provide both cordierite and SiC products, and its technical offer includes, kiln cars, superstructures, cordierite and extruded batts, cordierite and extruded props, pressed and cast caps and shoes, SIC beams, cordierite and cast stools and supports, RSIC and NSIC and lavi setters and batts, etc, for sanitarywares. For tablewares, pressed and extruded batts, pressed T-cranks and cast T-cranks, SiC batts, plate saggars, profile setters, O-setters and SiC setters. Imerys said its kiln furniture solutions for roof tiles guarantee high degree of automation of roof tiles handling, very good dimensional reproducibility of the roof tile products in terms of size and flatness, due to the exceptional dimensional accuracy and stability of the supports. “Extended lifetime of our supports is up to 3,000 cycles depending on operating conditions, due to a high resistance to mechanical and thermal constraints, and our technical offer for rooftiles includes H-Cassette kiln car refractories,” the manufacturer claimed. For technical ceramics, its offer includes high-alumina, mullitecordierite and SiC products, specifically focused on high temperature applications. The kiln furniture solutions for technical ceramics guarantee, high temperature resistance, wear resistance, high mechanical resistance (strength, fracture) in temperature, and corrosion resistance. The technical offer includes, box saggars, cast box saggars, cast and pressed box saggars, libs and ring saggars, pressed setters, stackable, covered box saggars, batts and beams/props, pressed and extruded batts, cast batts, tubs and props, and beams.

Tangshan Imperial-Hero Ceramics Co Ltd Location: Lubei District Tangshan City, China Products: Mullite-cordierite kiln furniture and silicon refractory materials Annual production capacity: 5,000 tons of mullite-cordierite kiln furniture Markets: Domestic and export markets, including ASEAN countries. Others: Tangshan Imperial-Hero Ceramics is a joint-venture investment with Tangshan Baiyu Ceramic Co Ltd and Futian-Sanjin Trade & Industry Company.

Jiangsu Yixing Zhongcun Kiln Products Co Ltd Location: Yang'an Country, Dapu Town, Yixing City Wuxi, Jiangsu 214226, China Products: Kiln furniture for tablewares and sanitarywares. Annual production capacity: About 800,000 pieces of boards or over 5,000 tons Markets: Domestic and export markets worldwide, including ASEAN countries. Others: Jiangsu Yixing Zhongcun Kiln Products Co is a joint-venture foreign investment. It is specialist on refractor boards of carborundum.

Jiangsu Sanheng High-tech Kiln Furniture Co Ltd Location: Yixing Ceramic Industrial Park, Yixing, China Products: High temperature tolerant kiln furniture for especially electronic ceramics Markets: Domestic and export markets, including ASEAN countries. Others: Sanheng's main product, the sandwich plate, is a three-ply composite structure plate.

Refmat Corporation Location: Luoyang, Henan, China Products: High temperature tolerant ceramic kiln furniture Markets: Domestic and export markets, including ASEAN countries. Others: Refmat’s kiln furniture are mainly of SiC, such as, ceramic tube, corundum, high-alumina, mullite, and SiSiC beam, etc, for the manufacturers of technical porcelain products, including, electrical insulators.

Carborundum Universal Limited (CUMI) (CUMI ceramic division’s super refractories department) Location: (1) Ranipet, near Chennai, Tamil Nadu, India (2) Jabalpur, Madhya Prodesh state, India Products: Ceramic kiln furniture and refractor products Markets: Domestic and export markets Others: Product lines in the fired range include silicon carbide, nitride bonded silicon carbide, mullite, zircon mullite, high alumina, and insulating fire bricks.

Saint-Gobain Grindwell Norton Ltd Location: 2, in Taluka-Halol, Panchmahal, Baroda, Gujarat, and in Bangalore, Karnataka, India Products: Ceramic kiln furniture and refractories Markets: Domestic and export markets Others: Manufactures ceramic kiln furniture and materials, such as, silicon carbide, performance ceramics and refractories, SEFPRO, crystals, etc. SaintGobain kiln furniture are exported worldwide. Saint-Gobain’s other Asia based production plants are located in Japan and China. ABREF kiln furniture. Photocredit, ABREF

Lightweight options

Japan based NGK Group has developed lightweight kiln furniture and it is competing well with other rival global leaders. Its lightweight kiln furniture is the result of a new production method, in which the kiln furniture of the same shape and size, it achieves a weight reduction of 30 percent or more compared with conventional products. It features little deformation, excellent spalling resistance, and can be bonded to create complex shapes. A broad range of its materials is available to

asian ceramics

AC 20-4

www.asianceramics.com

ASIA...

is one click away

www.asianceramics.com

Analysis: Kiln furniture

suit every application, said NGK. NGK Insulators Ltd famed, NGK Group, with its kiln furniture and refractory production plants, NGK Adrec Co Ltd, located in Gifu Prefecture, and its Thailand based subsidiary, Siam NGK Technocera Co Ltd, located in Saraburi, offer a wide range of kiln furniture and refractories for the tableware, sanitaryware and tile sectors. NGK Adrec produced materials include products made by silicon carbide (SiC), mullite, mullite-SiC, cordierite, alumina, etc, and also have its materials by its products, SiC quality NEWSIC, SiC quality SINSIC, SiC quality AIRSIC, mullite-cordierite, alumina/mullite MULLRON, alumina/mullite AIRON, and Porosity WHITE FILTER, according to the requirements of the customers. The Japanese industrial and technical/advanced ceramic major NGK has applied the firing technologies and expertise that it gained through the manufacture of insulators and ceramics to develop various types of ceramic kiln furniture, ceramic reactor vessels, and other refractories. It offers a broad range of kiln furniture and refractory products ranging from components for leading-edge fields including ceramic capacitors, flat panel displays, and ferrites to ceramics industries, such as, tiles, sanitarywares, and tablewares. In the tableware sector, it manufactures saggers, supports, shelf boards, clamps, and various other kiln furniture and refractories, and its many years of successful results have earned it a high level of trust among the users of kiln furniture. It also offers products with special shapes to match the shape of the tableware, and with a variety of coatings. In the sanitarywares, it produces shelf boards, supports, and various other kiln furniture and refractories. NGK manufactures mainly the kiln materials for firing products at NGK Group plants. It provides kiln materials that contribute to better manufacturing of NGK and production of high-quality products at low cost. The other is selling kiln materials and refractory materials to external customers, and providing new products.  Since its founding seven decades ago, it has worked with the parent company, NGK, to sell these products outside of the company. Starting from roof tiles, sanitarywares, and tablewares, in recent years, the industries covered by display panels, secondary battery materials, electronic components, such as, ceramic capacitors, etc, are now have entered a vastly diverse area of ceramic related manufacturing. The company said, although it is based on the technology cultivated through the firing of insulators and ceramic honeycombs of NGK, it diversified and expanded, and has worked on original technology and products according to various needs of the industrial world.

Oversupply issues

India is home to a lot of kiln furniture manufacturers of a diverse range of products for various types of ceramic product manufacturers, numbering over a thousand. Leading kiln furniture and refractory manufacturer, Saint-Gobain Grindwell Norton Ltd, has two plants, located in Taluka-Halol, Panchmahal, in Baroda of Gujarat state, and in Bangalore of Karnataka state. Saint-Gobain’s main product lines are ceramic kiln furniture and refractory materials, such as, silicon carbide, performance ceramics and refractories, SEFPRO, crystals, etc. Besides major operators like CUMI and Saint-Gobain, there are some others who have plenty of opportunities to expand markets at home and abroad as they are producing cost effective materials to meet the demand according to the current trend. Among them, Chennai based ABREF Private Ltd is continuously consolidating its markets domestically and also in the export markets.

asian ceramics

AC 20-4

ABREF said it is working for the cost sensitive products. Its cordierite kiln furniture is the most cost-effective material involving fast firing cycles, increased throughput in kilns, flexible design of loading wares and energy efficient operations. It is a significant producer of cordierite, manufacturing around 1,000 tons a year and the products are accepted by the sanitaryware, tableware and tile industries in the domestic and export markets. Other smaller operators also have good demand. Amerys Special Refractory, based in Morbi, Gujarat, clams to have garnered wide acclaim for making available quality and cost-effective kiln furniture. Bangalore based Silcarb Recrystallized Private Limited manufactures the complete range of lightweight SIC batts, posts, saggers, kiln car, etc. Its demand is rising. “SIC-based kiln furniture is lighter than traditional mullite etc based products and our range of recrystallized silicon carbide furniture work well with 1700 degree temperature under high loads,” said Silcarb. CUMI bubble zirconia plant at Kochi

ABREF Private Limited Location: Sipcot Complex, Gummidipundi, Chennai, Tamil Nadu, India Products: Cordierite kiln furniture for traditional ceramics Markets: Domestic and export markets Others: Manufacturers mainly cordierite kiln furniture.

Silcarb Recrystallized Private Limited Location: Malleswaram, Bangalore-560 055, India Products: Kiln furniture Markets: Domestic and export markets Others: Manufactures lightweight SIC-based kiln furniture.

Khyati Ceramics Location: 179-180A, GIDC, Kaalol, Gujarat, India Products: Kiln furniture Markets: Domestic and export markets Others: Manufactures mainly cordierite kiln furniture for traditional ceramics.

Anmol Ceramics Location: Navagram Village, Thangadh, Gujarat, India Products: Ceramic kiln furniture Market: Domestic and export markets Others: Manufactures kiln furniture for tablewares, sanitarwares, tiles, heavy clay items, etc.

PT BIOTA Indonesia (Foreign kiln furniture makers’ representative for customized supplies) Location: Kebon Jeruk , Jakarta Barat 11530, Indonesia Products: Kiln furnitures, inckuding batt, support, beam, crank, setter, saggar, etc Sourcing markets: All Others: Biota represents various reputable principals from several countries for raw materials, kilns, and kiln furniture.

www.asianceramics.com

ASIA...

is one click away

Do you produce or spray ceramics? We make the machines.

www.asianceramics.com

Nieuwkoop

喷压涂机机 vsmmetaal.nl Pressing and spraying machines

Analysis: Heavy clay

Fire it u fuel choices the talk of the sector

oal remains king in firing of brick kilns in the South Asian region and is likely to remain so for the future although there are efforts to increase use of natural gas and biogas to reduce air pollution. Coal is still the cheapest and most widely available fuel in the region. Initiatives to reduce air pollution from the innumerable brick kilns that dot the region, many of which are in the informal sector and difficult to monitor, focus largely on two areas. They aim to encourage a shift to more efficient types of kiln technology and improved fuel feeding and firing and air circulation methods. They also encourage a shift to making resource efficient products like hollow bricks that consume less clay and fuel. Despite decades of efforts by the region's governments with the support of international aid agencies and lending institutions to get brick manufacturers to clean up their act, highly polluting traditional brick kilns remain in widespread use. A plethora of laws and regulations have been introduced but few effective incentive schemes to encourage traditional brick kiln owners to switch to cleaner, more modern technology. These have not been as successful as anticipated owing to inadequate incentives, regulatory inconsistency, weak enforcement, and the lack of financial, technical and commercial capacity among brick kiln owners to make the switch. But more concerted efforts are now starting. "In south Asia, Bangladesh and some of the southern Indian states are ahead of the rest of the region," said Dr. Sameer Maithel, an expert on the industry. "Bangladesh, in the last 10 years, has had several initiatives to introduce tunnel kilns and Hybrid Hoffman kilns. Opinion is divided on whether they have been successful or not but they have tried. In India, it is mostly the southern states like Karnataka and Tamil Nadu which are ahead in terms of adopting new technology." In the entire Indo-Gangetic plain – northern Indian plains - from parts of Pakistan to northern and eastern India, Bangladesh and

asian ceramics

AC 20-4

parts of Nepal – the main firing technology is the Fixed Chimney Bull's Trench Kiln (FCBTK) which is now being converted to Zig-Zag kilns – a variation of the same kiln type in which bricks are arranged in a different manner which improves air circulation and decreases fuel consumption, said Maithel, founder and Director of Greentech Knowledge Solutions Pvt. Ltd. "In the rest of India there are different types of kilns," said Maithel won the 2017 Climate and Clean Air Award for Individual Achievement, for his work to reduce black carbon emissions from brick kilns in India."There are small intermittent kilns like clamps, which are not permanent where bricks are arranged with the fuel and fired, down-draught kilns in certain parts, and in southern India, Hoffman kilns. The Hoffman kilns in southern India were earlier used for roofing tile manufacture. Bangladesh is using Hybrid Hoffman kilns, a new version coming from China. There are very few tunnel kilns. The entire region has maybe 50 operational tunnel kilns for brick firing which are more advanced and also used for much larger production volumes. Bangladesh now has almost 30-40 tunnel kilns and India may be 10-15."

Cleaning up the act

The shift to cleaner firing methods is being pushed by legislation, said brick industry expert Anand Damle, Managing Director, Damle Clay Structurals, which focuses on mechanisation in the heavy clay sector. "A lot of people are shifting from fixed chimney kilns to Zig-Zag pattern kilns. This is mandated by India's Pollution Control Board and also several authorities, especially in the Delhi NCR have mandated conversion to Zig-Zag kilns," said Damle, also Managing Director of De Boer Damle (India) Pvt. Ltd., a joint venture with the Netherlands-based international supplier of soft mud brick installations. Dr. B. N. Dulal, Secretary General of Bangladesh Auto Brick

www.asianceramics.com

up! Manufacturers’ Association (BABMA), said the government had now recognised their sector as an industry, giving more recognition to those who invested in better technology. This was encouraging for members of BABMA, representing Hybrid Hoffman Kiln and Tunnel Kiln owners, who were asking government for an assured supply of natural gas to fire their kilns and policies ensuring a market for their products. With a total annual production of approximately 285 billion bricks and an average of more than 5% annual growth rate in brick production in recent years, the three countries in South Asia – Bangladesh, India and Nepal - are jointly the second largest brickproducing bloc globally, according to a new World Bank report on the region's brick industry. All three countries have less than 1% market penetration of advanced and efficient technologies (Hoffman, hybrid Hoffman and tunnel kiln), it said. "Both cost-benefit analysis and sensitivity test suggest that HHK and TK should be the technologies of choice of all entrepreneurs if they are constructing new kilns. This finding applies both to the financial analysis, reflecting private profit alone, and is even more pronounced in the economic analysis incorporating negative health and climate change externalities, which are substantial and offset all private profit except in the case of the cleanest, most efficient technologies." The sensitivity analysis suggests that hollow bricks – compatible primarily with modern kilns – and relatively lowinterest financing (also indispensable for capitalintensive modern kilns) dramatically enhance the profitability of HHK and TK technologies, both in the absolute sense and relative to low-debt, smaller-scale kiln projects such as zigzag kiln and fixed chimney kiln. Maithel said one of the main regulatory instruments used to prompt the shift to cleaner technology is emissions standards for brick kilns, which have been introduced in India, Nepal and Bangladesh. This limits the amount of pollutants allowed in flue gases. "Most standards in the South Asian region are regarding the amount of particulate matter allowed, but around the world, for ceramic industries there are even standards for different gases like sulphur dioxide or hydrogen fluoride," he told Asian Ceramics.

www.asianceramics.com

Analysis: Heavy clay

AN ABSENCE OF CLARITY ON HOW REGULATIONS WILL BE IMPLEMENTED CREATES INVESTOR UNCERTAINTY

AC 20-4

asian ceramics

Analysis: Heavy clay Under Construction Natural Gas Pipelines As on 31.03.2020 Name of Pipelines

Authorized Entity

Date of Length (KM) Authorization

Authorized Capacity (MMSCMD)

Target date of States from which Completion* Pipeline passes

Kakinada -Vishakhapatnam -Srikakulam

APGDC

16.07.2014

391

June’2021

Andhra Pradesh

Jaigarh-Mangalore

HEPL

28.06.2016

749

March’2021

Maharashtra, Goa,Karnataka

Kakinada-VijayawadaNellore

IMC

19.02.2018

667

22.5

Feb’2021

Andhra Pradesh

Max. of 36 months from the dateof authorization

Assam, Mizoram,

North-East Natural Gas Pipeline Grid (Provisional Authorization)

IGGL

Kanai Chhata -Shrirampur

Consortium of 08.07.2019 H-Energy

317

19.2

July’2022

Manipur,Arunachal Pradesh, Tripura, Nagaland, Meghalaya & Sikkim

Srikakulam-Angul

GAIL

690

6,65

July’2022

West Bengal

14.09.2018**

23.07.2019

1656

"Despite the introduction of standards, countries in the region are finding it difficult to implement them. A major reason is the large numbers of kilns to monitor. The brick industry in India consists of 150,000 – 200,000 kilns while Bangladesh has about 10-15,000 kilns. While these kinds of emissions standards are easy to implement in large industries, they become challenging when having to monitor and implement them in small industries numerous in numbers and scattered throughout the country, and not located in an industrial area. "There are also issues related to extraction of raw material, clay," Maithel said. "In southern and eastern India the clay comes from river silt which is harvested or from irrigation tanks that are de-silted. But elsewhere, most clay for making bricks comes from agricultural fields. That’s where there is concern. Some of the regulatory changes being introduced in India cover mining of clay, such as getting EIAs (environmental impact assessments) done on the area from where you are extracting clay. Similarly, I believe, that Bangladesh has quite strict rules regarding clay mining and sourcing."

Uncertain legislature

But policies and regulatory environment is quite uncertain, and regulations are sometimes not properly implemented. "This is an important barrier for industries which want to upgrade," Maithel said. "The absence of clarity on how regulations will be implemented and on future regulations creates uncertainty for investors. Policies and regulations introduced by central governments take a few years to start getting implemented by local governments. Furthermore, if policies are not clear then their implementation varies from region to region. In India there's a huge amount of litigation between industry and government. For instance, several cases handled by India's National Green Tribunal, which adjudicates on environmental disputes, are regarding the brick industry." Damle believes a new initiative by India's Bureau of Energy Efficiency (BEE), which is part of the Power Ministry, on a voluntary accreditation mark called “Energy Efficient Enterprise (E3)”, will provide the necessary incentive for brick kiln owners to switch to better technology. The BEE is responsible for developing the star rating system for electrical appliances like refrigerators where the higher the rating in the 5 star rating system the more energy efficient it is, meaning lower electrical energy consumption.

asian ceramics

AC 20-4

"The BEE has started focusing on big industry in India and they are now coming out with a scheme - I am also a part of it – that has developed the E3 mark. They will soon start offering this E3 mark to brick enterprises which want this particular certification from government," Damle told Asian Ceramics. "Generally, people with Zig-Zag kilns should be able to get it. Once they have the E3 mark, they become eligible for participating in government tenders. Also, for the public there will be a lot of awareness campaigns by BEE. So the construction industry - government contractors, private builders and private owners – will start buying bricks from E3 mark enterprises. To begin with, the BEE is addressing thermal energy the fuel used in firing of bricks. But also they are going to advocate use of lightweight bricks, which means perforated and hollow bricks. This will save virgin clay." Technology modernization is expensive. A traditional (manual labour intensive) brick kiln based on FCBTK would cost around INR 5 million to commission, notes a report by the BEE and the Indo German Energy Programme on the E3 mark project. A modern tunnel kiln would easily take around INR 70 million. Add to this investment required for mechanization of value chain activities and the investment stretches to around INR 120 million. India is the world’s second-largest producer of bricks, with an annual production of around 250 300 billion bricks (440 530 million m3) per annum. Given the large projected increase in the building stock in India, the demand for bricks is expected to multiply by 3-4 times in next 20 years and reach 750-1000 billion brick/year, the BEE report notes. Construction carried out by the unorganized sector which includes construction done by local masons, civil contractors, small builders as well as self-construction is estimated at around 0.65 billion m2/ year, about 87% of the total annual building construction in India, making it the main mode of construction in the country. New clay products like perforated and hollow bricks and blocks have lower densities, consume less clay and energy in manufacturing, have lower thermal conductivity values, and can also be produced in larger size format. But in India the share of new type of clay bricks is currently less than 0.5% of the market share; majority bricks being the solid clay brick. Even though, twenty to forty percent of the manufacturing cost of a brick is due to energy, a variety of barriers dis-incentivize modernization in this sector.

www.asianceramics.com

Analysis: Heavy clay

Table 1

MCBTK FCK Non-std Zig Zag HHK - Coal Tunnel kiln

19.18 75.43 4.76 0 0

4.1 92.21 3.07 0.2 0

Bangladesh Brick Technology MCBTK

FCK

Non-std Zig Zag

HHK - Coal

% market share 2010 Tunnel kiln

MCBTK

MCBTK FCK Non-std Zig Zag HHK - Coal Tunnel kiln

0 50 48.32 1.03 0.05

FCK

Non-std Zig Zag

HHK - Coal

Tunnel kiln

0 70 0 0.08

% market share 2018 Tunnel kiln

E3 locations?

Two potential regions are earmarked for the E3 mark project implementation during the initiation phase, one in South India covering Bengaluru - Chennai - Coimbatore – Madurai, and the other in North India covering the Delhi NCR – Chandigarh – Varanasi. These locations are proposed for the pilot mainly because setting up a new E3 manufacturing plant would itself take around 2-3 years and manufacturing capacity required to produce energy efficient bricks already exists at the proposed 1 locations, ensuring the availability of energy efficient bricks in the market from the beginning and helping in expediting the implementation and testing of the concept. There is also initial level awareness about the benefits of the use of energy efficient bricks among the users at these pilot locations. BEE will consult select Indian manufacturers and technology providers in India and abroad to develop affordable technology packages as per Indian requirements, depending on the desired product mix and production capacities (e.g. 100 ton per day, 200 ton per day). The BEE initiative will become active within the next couple of months, said Damle. "Generally, government schemes act as a stick. That generally never works and then people tend to do things illegally. A lot of people, including me, have pleaded with the government to have schemes that work as carrots and not as sticks. The BEE E3 mark scheme will be the first scheme that's not only

HHK - Coal

28.36

% market share 2014 MCBTK

Non-std Zig Zag

Table 1

MCBTK FCK Non-std Zig Zag HHK - Coal Tunnel kiln

FCK

asian ceramics

AC 20-4

MCBTK

FCK

Non-std Zig Zag

HHK - Coal

Tunnel kiln

practical but is going to provide a carrot to motivate industry to go for it, and not force the industry. Its success will really open up a new way of working with industry for the government." Entrepreneurs shifting to Zig-Zag kilns can also ensure bricks are fired fully and all fired at the same temperature, so brick quality improves, Damle notes. FCBT kilns yield 60-70% 1st class bricks, but this goes up to 80-90% in Zig-Zag kilns, so the overall profitability of the enterprise will increase. "And the shift to better technology will bring tremendous fuel savings – around 20% or so. When less fuel is 1 burnt the cost to brick makers will be less along with less pollution," said Damle. The main fuels used by brick makers in the region are either coal or biomass fuels, said Maithel. "One option in using cleaner fuels is to shift to natural gas. There are a few kilns in Bangladesh and a few in India which are either operating or are in the process of shifting to natural gas firing. There is also a possibility that if you mix powdered coal or fuel with bricks, then that type of firing results in less emissions of particulate matter, although that's not exactly use of cleaner fuel. In some cases people tried to use biogas or producer gas (produced from biomass gasification), but then biogas or producer gas generation has to be in-house, which puts additional responsibility of managing the biomass and gas generation on the brick enterprise. Any type of gaseous fuel is best in terms of cleanliness. Mostly, people are thinking of natural gas but biomass is

www.asianceramics.com

The Best “Squaring” Performance

Analysis: Heavy clay

also possible because several kilns are located in rural areas where there may be different kinds of biomass material."

Coal sourcing issues

Coal availability in India is very good and it's possibly the cheapest fuel, said Damle. "So, for the next maybe 30-50 years it will be only coal in India for clay brick making." In India, brick kilns mostly use coal mined in India while kilns near ports can buy coal imported from the USA, South Africa or Indonesia, Maithel said. Most Indian coal has low sulphur, except coal from North-East India (Assam, Meghalya) which is high sulphur. The BEE says the choice of coal depends on landed coal price and local availability, for example kilns in Punjab and South India, with no local mines, may choose imported coal over domestic coals, whereas those in Bihar will not. Despite price sensitivity, brick units pay nearly 3 to 4 times (Rs 6,000 – 11,000 per tonne of coal) when compared to power plants. "The availability of natural gas is not very high," said Damle. "There are some locations like Varanasi where natural gas connections are coming. In the Ahmedabad-Morli area there are a lot of ceramic clusters which have natural gas connections. Availability is the main issue – once gas is available, people want to have it." Maithel explained that even if kilns shift to natural gas, the cost of energy becomes one and a half to two times more than coal although the quality of product becomes better and wastage reduces with fewer rejects, and very low emissions. "For this shift to happen on a larger scale, brick kilns, now scattered everywhere, will have to come together in some sort of cluster where natural gas can be supplied. If not, the cost of extending pipelines will be very high," he said Also kiln owners will have to shift from burning bricks only in the dry season and operate throughout the year to make it viable for gas companies to extend their pipelines. "The Indian government is yet to make a concerted effort to shift brick kilns to natural gas. Now it is mostly individual bricks manufacturers who are progressive who are trying to use natural gas. The government will have to assure a reliable supply of clean fuel like gas and provide a clear policy on how to get clay before brick manufacturers invest in changing kilns. A lot of these enterprises are still mostly informal. The entire

asian ceramics

AC 20-4

formalisation of the industry will be required if you want to shift to natural gas, with all kinds of licenses and paperwork. Currently, not many enterprises are at that level." The brick sector consumes about 5 million, 62 million and 1 million tons of coal every year in Bangladesh, India and Nepal respectively, making this sector the first or the second largest coal consumer in each of these countries, according to the World Bank study. In India, the brick industry is the largest industrial consumer of coal, second only to steel industry. Bangladesh’s brick sector has experienced the largest number of interventions to support scaling up advanced technologies, the World Bank study said. New laws banned traditional polluting FCKs near farmland, forests and urban areas. But enforcement is weak and many traditional kilns are still operating. The number of HHKs and TKs has grown dramatically with about 50% growth between 2010 and 2016. In Bangladesh, according to the government registration data dominated by ZZK, roughly 60% of all operating kilns are considered as improved/intermediate technologies (namely ZZK, HHK and TK). In Nepal and India, these figures are roughly 17% and 3%, respectively. According to BABMA there are 90 Hybrid Hoffman Kilns and 30 Tunnel Kilns with forty crores and seventy crores invested in each and collectively employing about 36,000 workers. Dulal, of BABMA, said the auto bricks firms represent a collective investment worth 4,800 crore Bangladeshi Takas. Each such factory costs much more than traditional kilns whose owners spend only one crore Taka and go into production on rented land, making it difficult to compete with them. BABMA is asking the government to give them an assured supply of natural gas and ensure a market for their bricks with policies promoting use of their products in government-funded construction ventures as well as in private real estate projects. Dulal, who is also Chairman of First Auto Bricks Ltd., a Bangladesh-China joint venture, said clay bricks were important for Bangladesh which is a low-lying land prone to flooding and lacks domestic sources of other construction materials like stone. In India, minimum prices are in the Delhi NCR and surrounding areas – in the range of Rs4-5 ex-works per brick for the standard 9 x 4 x 3 inches size, according to Damle. In Kolkata in the eastern region bricks are sized bigger - 10 x 5 x 3

www.asianceramics.com

HITO TECHNICAL INDUSTRIES

HIGH DENSITY ALUMINA BALLS AND LINING BRICKS ALUMINA NANOBEADS ZH

HITO TECHNICAL INDUSTRIES, S.L.

• Narcís Monturiol, 26 · 08187 Santa Eulàlia R. (Barcelona) · Spain · Phon. +34 938 449 982 · Fax +34 938 449 269 • Cantabria, s/n · Pol. Ind. El Colador · 12200 Onda (Castellón) · Spain · E-mail: hito@hito.es • Paseo de la Castellana, 141 · Edificio Cuzco IV, planta 5 · 28046 Madrid · Spain Phon. +34 915 726 529 · Fax +34 915 726 621 · E-mail: international@hito.es

HITO GRINDING MEDIA, S.L.

•Avenida de Aragón, 30 · Edificio Europa, planta 8 · 46021 Valencia · Spain Phon. +34 960 468 643 · Fax +34 960 468 601 · E-mail: ceramica@hito.es

HITO POLSKA Sp. z o.o.

• ul. Tadeusza Kosciuszki 34 · 81-702 Sopot · Poland · Phon. +48 58 355 10 08 · E-mail: hitopolska@hitopolska.pl

Analysis: Heavy clay

inches – and prices never come below Rs7-8 per brick, ex-works. Delivered Table prices could be Rs10 onwards. In central and western 1 India prices are around Rs5-6 for standard bricks. In South Clamps/DDK 100,000 India in places like Madurai prices are in the range of Rs7-8 per MCK 100 brick. Maithel said the highest prices are in the states of West FCK 40000 Bengal and some of the southern states. Bangalore HDK/ZZKand Tripura3000 VSBK 100 has quite a good market for hollow bricks which if converted to HK 500 the TK equivalent of solid 12 bricks fetch prices of around Rs8-12 per brick. Number of brick kilns by type in India

There are about 1,600 brick kilns operating in Nepal with an annual production of 5 billion bricks. Only around 8% of the total brick kilns operate in Kathmandu Valley. MCKs and FCKs are the most widely used technologies in Nepal, although Table 1 underway to switch from MCKs to FCKs efforts are now and/or ZZKs with technical support from bilateral agencies, Clamps/DDK 0.5 international NGOs and MCK 3 private sector experts. VSBK has not FCK 4.5 succeeded much despite technical assistance from Swiss HDK/ZZK 5 Development Cooperation. VSBK 3 HK

India: Average production capacity (m. bricks/annum/kiln)

Table 1

Clamps/DDK MCK FCK HDK/ZZK VSBK HK TK

50 0.3 180 15 0.3 1.5 0.3

Table 1

Clamps/DDK MCK FCK HDK/ZZK VSBK HK TK

50 0.3 180 15 0.3 1.5 0.3

India: Total annual production ('000m. Bricks)

Number of brick kilns by type in Nepal

Table 1 Table 1

Clamps/DDK MCK FCK HDK/ZZK VSBK HK

0.3 4 4 5 3 17.5

Nepal: Average production capacity (m. bricks/annum/kiln)

Clamps/DDK MCK FCK HDK/ZZK VSBK HK

0.15 0.2 3.8 0.6 0.06 0.09

Nepal: Total annual production ('000m. Bricks)

asian ceramics

AC 20-4

www.asianceramics.com

Talking Shop

In focus: Keramischer OFENBAU GmbH planning for a new tomorrow

AC talks to Managing Director Thomas Alten (responsible for sales, R&D, finances) and Sales Director Georg von Oldershausen (responsible for sales area Asia) at Keramischer OFENBAU GmbH about the company’s prospects in a post-Covid industry climate… Keramischer OFENBAU GmbH, as a plant manufacturer for kiln plants for the ceramic and related industries, is located at Hildesheim/Germany. The team has got decades of experience in kiln building, while being very innovative at any time. The objective is to put into practice new ideas and technologies for all kinds of kiln plants, with directly and indirectly gas heated or electrical heating systems. Furthermore, energetic modernization, repair and Thomas Alten - Managing spare parts service and assistance Director KOG for all questions around firing ceramic products are among the company’s portfolio. With its selfdeveloped extremely efficient heating systems, such as EnerViT or EnerViT plus for gas-heated and continuously oxidizing kiln plants (like tunnel and roller kilns) or LAMBDA Control for discontinuous kilns (like shuttle and chamber kilns), Keramischer OFENBAU is a leader in the field of energy efficiency in kilns; continuous further developments lead to further savings in energy consumption and CO2 emissions. The focus is always on first-class quality of the end products and thus a high level of customer satisfaction. AC: How is Keramischer OFENBAU coping during the present crisis in terms of being able to stay in operation? Thomas Alten: As it is the case with many medium-sized companies in the plant engineering sector, we- cannot predict how long the global massive restrictions will continue to remain in place and how they’ll affect future developments. We‘re happy to learn that many customers consider this time to be the right one to discuss in particular about projects for energetic retrofitting of existing kilns. Many federal states support such investments with subsidies, so that the reduction of CO2 emissions together with the reduction in fossil fuel consumption is also very interesting from an economic point of view. We just completed such a sponsored retrofitting kiln project with a German customer. We have a high order backlog from the period before the pandemic. Due to the worldwide restrictions, however, our ongoing construction

asian ceramics

AC 20-4

sites in many countries (e.g. USA, Portugal, China, Indonesia, ...) could only be continued or completed by finding new solutions very quickly. At a very early stage we investigated alternative options of how to complete shutdown construction sites and reopened some of them via utilisation of remote supervision tools and implementation of videoconferencing. In China, i.e., using remote cameras at site combined with daily video assistance from our team at Hildesheim headquarters, we Georg von Oldershausen completed successfully the assembly of a Sales Director shuttle kiln. So, that’s just one example for if you dig deep enough, you will always discover positives and new opportunities This combination has been a great success story and will, without doubt become a standard working method and optional path for many future projects. Georg von Oldershausen: As everywhere else in the world, the contact to our worldwide business partners has very quickly changed into periodic video conferences. The support provided by our local representatives was further intensified. Even with completely new customers, projects were brought to an almost final stage. Above all, we are very proud that despite these challenging times we have managed to successfully conclude a contract with an Indian customer for a shuttle kiln for the firing of technical ceramics, together with our Indian JV Keramischer OFENBAU India. Several new kiln projects, i.e. a big shuttle kiln in Europe, a completely new tunnel and shuttle kiln plant abroad, are in the pipeline and have been discussed and negotiated up to contract signing just a mere stroke away. AC: What is your current status, and what are your plans to get back to full service? Thomas: Our team managed very well during the pandemic situation, most important, all of us are healthy. We’ve been fully available for our customers during the whole time with remote service, with personal service in Germany, and with immediate spare parts deliveries, to the extent that our set point of spare parts sales has been exceeded already.

www.asianceramics.com

Talking Shop

VISITS TO CUSTOMERS WILL BE STILL NECESSARY TO SHED LIGHT ON ALL FACETS OF THE PROJECTS We continued and just completed successfully in good time two projects in Germany, both for energetic retrofitting of kilns for flowerpots. We put more capacities in Research & Development projects, to develop further energy savings options in addition to our well-known heating system EnerViT or EnerViT plus for continuous kilns, the LAMBDA Control for our shuttle kiln is now designed such that an energy consumption of up to 25 % compared to competitors’ kilns is possible to be achieved. And we work on complete upgrades of some kiln types or kiln components. In addition to the traditional ceramic industry as one of our focal points, we are constantly looking at developments in other areas, for example, the broad area of e-mobility and the corresponding battery production. With the roller kiln eRO Keramischer OFENBAU contributes its decades of comprehensive know-how to the thermal treatment of cathode powder material for Li-Ion batteries. Here, too, we have developed and applied energy-saving and sustainable kiln concepts in cooperation with relevant networks and manufacturers in the battery industry. AC: What changes will there be in the way you operate your business going forward? Will you work more over video-conference, or will you continue to travel to meet with your customers personally? Thomas: We have seen a great willingness and speed among our whole team and all our business partners to use video conferencing tools. That’s very positive, this way of communication will surely be established and remain for the future. Just another example, we are now arranging for virtual sales trips, together with our representatives, to different customers in one country, structured quite similar to a normal sales trip. The resulting relief of our travel expenses budget is also of advantage. Georg: In any case, following the present travel restrictions, visits to customers will be still necessary above all to shed light on all facets of the projects. This is rarely achieved only by video conferences. We have already received requests to visit several companies in Europe, Africa and Asia to advance their projects together with us. We are now starting with the appropriate travel preparations, always considering possible risks and local hygiene regulations. In any case, besides all digital aids, personal contact is of utmost importance. AC: Are you concerned that when industry emerges from this crisis, that there will be a potential negative feeling towards China (and/or South East Asia)? Thomas: NO! As an open-minded and internationally working company, we’ll be more than happy to continue our global business and personal relationships all over the world. AC: What sectors of the ceramics industry do you think will be hardest hit by this crisis, and do you have any ideas as to how the industry can "bounce back" quickly? Thomas: Our analyses as well as discussions with business partners clearly show that the tableware industry may be hardest hit by the crisis and that there the market recovery may take longer. We assume for some markets it will probably take up to 2 – 3 years. The automotive sector, especially for vehicles powered by combustion engines, will also experience a longer recovery or change phase. In our estimation, the situation in the construction industry will bring sanitary ceramics back to pre-crisis levels relatively quickly. Other markets, such as i.e. the market of Latex gloves and the corresponding ceramic hand formers, as well as the

www.asianceramics.com

market of ceramic insulators, may experience a significant growth. With regard to the global market, we think that the markets in South America will probably need more time to recover. AC: Are you looking to expand more overseas or do you think you will concentrate more domestically at the moment until the industry steadies itself again? Georg: With the gradual lifting of travel restrictions, we will continue to expand in many overseas markets. For some specific markets with a high level of engineering, we will focus on more domestic markets. Anyhow, we’ll continue to be as flexible as the market requires for a plant manufacturer. AC: Many people think that exhibitions (trade shows) will be virtually impossible for the next 12-18 months because of the numbers of people that would gather. How do you think that will affect your business, and what will you do to ensure you stay in touch with your customers? Georg: There will always be the need for customers to inform themselves. Where can a customer get better information and meet more business partners than at a trade fair? E.g. Ceramitec in Munich is an important trade fair for us, and we really hope that next year's fair will take place in May so that we can participate as exhibitors. We expect decisions by the end of this year. At the moment, we are working on marketing which is stronger and directed more individually towards our potential customers. We are also focusing on social business media, reports in magazines and networking in general. AC: What changes do you think will stay in place after this lockdown? People have got familiar with cleaner air and water for example... do you think there will be an anti-industrial movement that gets more prominent? Thomas: I don’t think that there will be an anti-industrial movement. But (hopefully) there will be a big step towards “greener” technology, and more digitation. We have focused very much on developments in energy efficiency systems, like EnerViT plus for continuous kilns and LAMBDA Control for discontinuous kilns, which helps our customers to reduce the energy consumption and the CO2 footprint during the really energyconsuming firing process. At present, we also develop new ideas in the field of digitation and automation during the ceramic production process and the use of alternative heating mediums such as Syngas, H2 etc. We’ll surely present our ideas soon. Georg: It would be fantastic if humanity would learn from this pandemic that nature cannot be exploited endlessly and that we must handle its resources with care, if only out of love for our children! AC: Will Keramischer OFENBAU be able to increase its presence in new markets as companies in Italy and Spain are forced to remain closed for longer? Will this give you an advantage? Thomas: As more or less all countries are affected very hard by the worldwide pandemic and international lockdowns, we do not see any individual market advantages for one or the other. We increase our presence in existing and new markets by offering state-of-theart technology industrial kilns with very low energy consumption and by offering all-over personal support for any issues around the thermal treatment. AC: Finally, if you could give one message to the ceramics industry at this very difficult time, what would it be? Thomas: Invest in “clean and green” technologies to be competitive for the future.

Keramischer OFENBAU GmbH info@KeramischerOFENBAU.de www.KeramischerOFENBAU.de

AC 20-4

asian ceramics

Located

on the Western side of the country, and glazed vitrified tiles. Malootana plant commenced operations adjoining Gujarat on one side and one in 2016 with a capacity of 6.50 million square meters per annum of of the largest market of National Capital Region ( NCR) of polished vitrified tiles. Delhi on the other side, state of Rajasthan has perhaps the Kajaria’s Gailpur plant is the largest single-location ceramic tile unit in the country. best placed state for It produces 25.20 the development of Ceramic tile production million square meters ceramic industry in 2014 2015 2016 2017 2018 of ceramic wall the country. and floor tiles and Ceramic tile installed capacity 34.10 34.10 41.10 43.40 46.90 9.10 million square Home to the (m. sq metres/annum) meters of glazed largest ceramic tile Actual production 29.05 29.90 35.80 37.79 39.90 vitrified tiles. Gailpur producers, Kajaria (m. sq metres/annum) produces almost half Ceramics, three of the Number of producing units 3 3 7 9 11 the company’s total best known names production. in Indian ceramic The state houses tableware industry ( Ceramic tableware production some of the most Clay Craft India, Jaipur 2014 2015 2016 2017 2018 Potteries and Hopewell Ceramic tableware installed reputed ceramic 8,200 8,410 8,800 8,800 9,150 tableware producers. Ceramics) and a capacity (tpa) number of ceramic Clay Craft , Bharat 7,300 7,540 7,900 7,970 8,300 Potteries and Jaipur insulator producer, Actual production (tpa) 13 13 14 14 15 Ceramics are some of Rajasthan is among the Number of producing units top ceramic products the best known names producing state in the Ceramic insulators production in Indian ceramic country. In terms of tableware industry. 2014 2015 2016 2017 2018 ceramic production, Most of these ceramic Ceramic insulators installed the state is the leader tableware producers 65,000 67,000 74,500 79,000 84,000 in ceramic tableware capacity (tpa) are based in and Actual production (tpa) 54,000 55,400 61,900 63,600 62,100 around the state capital production. The state is one of Number of producing units 12 12 14 16 17 Jaipur. the most important Production of producers and ceramic insulators has Leading tableware producers suppliers of raw material gained momentum in the Location Installed Capacity last decade in the state of for Indian ceramic Company industry. In fact, nearly Bikaner Ceramics Pvt Limited Rajasthan. Currently, the Bikaner 9000 TPA 70 % of the raw materials state accounts for 30% of Bikaner 3000 TPA needed for ceramic Bikaner Porcelain Private Limited the production of ceramic production in India is Modern Insulators insulators in India. Mount Abu 30,000 TPA supplied by the state. Towns like Jaipur and Bikaner 12000 TPA Ceramic tile production Suraj Insulators Bikaner have a strategic in the state is dominated Adpro Ceramics India Pvt Limited advantage in terms of Jaipur 3000 TPA by Kajaria Ceramics, raw material and local Bikaner 4000 TPA which operate two AK Ceramics craftsmanship. Ceramic production units in SLGK Cera Pvt Ltd insulator manufacturing Jaipur 2000 TPA Gailpur and Malootana industry in these cities Ambica Ceramics Bikaner 3000 TPA in the state. Gailpur plant consists of small-scale was commissioned in 1998 with an installed capacity of 6 million units with investment ranging between INR 0.5 million to INR 20 square meters per annum, which has been increased to 34.30 million. The annual output of the industry is between INR 700 – million square meters per annum of ceramic wall and floor tiles 800 million per annum.

asian ceramics

AC 20-4

www.asianceramics.com

However, Rajasthan’s most important contribution in Indian ceramic industry has been the availability and supply of the raw materials to Indian ceramic industry. The state account for nearly 70 % ( based on volume) of the raw materials to ceramic industry. Despite, the number of strategic advantages, which the state of Rajasthan enjoys for the production of ceramic products, the industry has not been able to realise its true potential. Whatever progress state’s ceramic industry has made is despite the government, instead of any help from the government or agencies. Raw material suppliers Company Avinashi Minerals Goyal Milling Industries N Grinding Industries Golcha Minerals Golcha Associated Group Goyal Minerals Group Wolkem India Shree Grinding Mills Shri Balaji Minerals Avani Group of Industries Arihant Minerals Sagar Minechem Bikaner Clays & Minerals Tahla Ram and Sons Raj Minerals Daga Clays JLD Minerals Shiva Minerals Maya Minerals Barunda Minerals Pvt Limited Nahar Colour and Coatings Hopewell Ceramics Excel Colours & Frits Limited Deepak Mineral Industries Gupta Grinding Mills Shree Modi Levigated Kaolin Pvt Limited Eros Minerals Pvt Limited WMA India United Microns

www.asianceramics.com

Location Sikar Alwar Bijaji Nagar Jaipur Jaipur Sikar Udaipur Ajmer Jaipur Udaipur Beawar Bhilwara Bikaner Bikaner Bikaner Bikaner Bikaner Ajmer Udaipur

Product Feldspar, Quartz Feldspar, Clays Clays Talc Talc Talc, Quartz Multiple Multiple Clay Talc Multiple Clays and feldspar Clays Clays Clays Clays Clays Quartz Multiple

Jodhpur

Talc

Udaipur Jaipur

Glaze Glaze

Jaipur

Glaze

Jaipur Beawar

Multiple Clays

Sikar

Kaolin

Jaipur Beawar Beawar

Multiple Multiple Feldspar and clays

R aja st h a n

“According to Surendera Singh Purohit, President of RIICO at Bewar in the state, “Rajasthan is ideally placed to benefit from the rising consumption of ceramics in the country, especially in the national capital region, Delhi. However, state government need to expedite the process of setting up new ceramic manufacturing units. Disposal of applications at various levels in Rajasthan is very slow and investors do not like long delays. The Rajasthan pollution control board and Environment clearance committees are too slow in disposing the applications” Leading tableware producers Company Jaipur Ceramics Pvt Ltd Bharat Potteries Limited Data Ceramics Neeraja International Clay Craft India Jaipur Glass & Ceramics Marvel Ceramics Hopewell Tableware

Location Jaipur Jaipur Jaipur Jaipur Jaipur Jaipur Alwar Jaipur

AC 20-4

asian ceramics

IN ADVANCE: MLCC

Putting up resi MLCC demand and supply dynamics

In the latest of our new section dedicated to the advanced ceramics sector across Asia, Jahir Ahmed focuses on developments in the increasingly competitive MLCC industry

mid a slowdown in world economic growth during COVID-19 pandemic, the multilayer ceramic capacitor (MLCC) industry has suffered a certain impact, but still maintained to be relatively optimistic. The outbreak of coronavirus has severely affected both demand and supply side. To a significant extent, it remains uncertain whether or not MLCC market will downsize this year. The demand supply dynamics of MLCC was impacted adversely by the COVID-19 pandemic in the Asian countries. The Philippines and Malaysia, two major producers-consumers of MLCC implemented lockdown in the industrial cities in response to the COVID-19 pandemic, which caused passive parts makers such as Murata, Samsung, Walsin, and Ralec to close their factories in these two countries, leading to a sharp decline in MLCC and resistor supply. According to the industry analysis, leading market players Murata, Samsung, and Taiyo Yuden's MLCC capacity in the Philippines accounted for 15 percent, 40 percent, and 25 percent, respectively. Ralec and Walsin also have factories in Malaysia. Lockdown in the Philippines and Malaysia has brought a tightening effect on global supply, causing a large number of orders to shift to Yageo, which has China as its main production base. MLCC’s major user is 5G. The key components of 5G base stations like optical fibers or PCB are basically manufactured in China, especially in Wuhan, Hubei, where COVID-19 originally first reported and infected and killed many thousand people. The negative effect of 5G base station built up is expected undoubtedly, as the impact suggests. According to industry sources, mobile carriers, network suppliers, and analysts are warning that the rollout of 5G networks could be delayed as a result of the impact of the coronavirus pandemic. The full impact of the pandemic won’t be known until the June or July. At this moment,

asian ceramics

AC 20-4

the US 5G rollout reportedly appears to be in better shape than Europe, with China’s deployment seemingly right on track. Samsung said that the investments in 5G networks will be reduced or delayed domestically and internationally, because of more effects of COVID-19. 5G has reportedly increased the demand for MLCC as the need for such devices is higher in 5G devices than in 4G, with smartphones generally accounting for 40 percent of MLCC demand. It is more oriented towards control functions in the automotive space, and used in a variety of applications relating to power management and charging converters in those vehicles with hybrid or full electric power systems with the number of MLCCs in such vehicles. Samsung Electro-Mechanics is building a new MLCC production facility, primarily for automotive application in Tianjin, China. Process technology for MLCCs is specialized and capital costs for new production capacity is also high, so MLCC supply has been tight, leading to recent shortages.  Samsung said, the Chinese government has restricted the final construction and outfitting of the plant and the company does not expect to be able to supply product this year as expected.  The company also indicated that a returning workforce of less than 50 percent at its MLCC plant in the Philippines, a result of governmental restrictions, is also causing issues for the company’s MLCC production, while demand is increasing, and will keep operating rates for MLCC production below 80 percent in the second quarters.  The company is expecting to increase its MLCC production in Busan, Korea, and will sell out of inventory, but it is questionable whether this will be enough to cover the shortfall.

Disruption in Asia

MLCC production capacity in China and other region regional countries has been disrupted due to the

www.asianceramics.com

IN ADVANCE: MLCC

istance pandemic, although a number of production sites have been reopened in March and April, albeit with some running limited production.  March also saw a 19 percent price drop for materials used to produce passive components, such as, resistors, capacitors, inductors, etc, indicating that the industry capacity was rebounding slowly. It is however, not sure about the quick return of the demand, and from what application. However, China is standing on enough commodities to support the global production of its MLCC products for roughly three months. That is a massive amount of raw material just sitting around. But due to the offset situation between inventory supply and consumer demand, Chinese electronics manufacturers and automotive companies have had their business stunted as both make heavy use of MLCC chip components. Industry sources said the current demand for MLCCs is greater than ever, driven primarily by significant technology breakthroughs and corresponding market growth in the overall electronics industry. Specifically, a handful of sectors will continue to keep MLCCs firmly in the spotlight of major user industries, telecommunications, computer, automobiles, personal health tech devices, military industrial equipment, etc. Telecommunications is a sector that holds great potential for the market, and the manufacturers are banking on the 5G technology to drive the growth of the market. The impact of MLCC on many of the major products is too great. The new technologies, like IoT, 5G, and EVs, are highly dependent on the availability of MLCCs. This has driven the manufacturer to align the product line and production capacities, to serve the requirements of the technologies. The market consists of very few market players having limited production capacity, due to which there is a huge gap between demand and supply of MLCCs. Currently, Asia-Pacific is the fastest-growing market of the MLCC, due to the rapid growth in the application of MLCC based electronic component and renewable energy products across the automotive sector all over the region, where China is one of the leading manufacturers of MLCC, with a strong presence of local companies. Moreover, Chinese MLCC manufacturers have been rapidly increasing for the past few years, while focusing on the supply of consumer electronic products. With the arrival of Industry 4.0, China is expected to see a massive growth in the automation and industry sector. The growing government regulations in favour of the

www.asianceramics.com

electric vehicles market, globally, are also fueling the demand for MLCC in India, as well as, in East Asian and Southeast Asian countries. Many new series of MLCC and applications of MLCC have been increasing its demand in the Asian countries every year. Japanese company TDK Corporation’s President, Shigenao Ishiguro, has announced this year that TDK has developed a new series of MLCC, the industry's first 0510 size ‘CGAE’ series with a vertical / horizontal reversal type for in-vehicle use. This product has a structure in which the electrode direction is inverted 90 degrees vertically and horizontally compared to the normal type MLCC. The equivalent series inductance (ESI) and impedance have been reduced by making the current route thicker and shorter. The vertical/ horizontal reversal type MLCC has already been widely adopted for general use, but this time TDK is the first in the industry to support AEC-Q200 for automotive use, but has a large capacity of 1μF in 0510 size (0.5 mm×1.0 mm) was realized. In recent years, advanced driver assistance system (ADAS) has become increasingly important in terms of vehicle safety, and with the advancement of advanced functions with a view to autonomous driving, its control requires the same performance as PCs and smartphones It has become. In particular, as ICs become more sophisticated, more and more decoupling MLCCs tend to be used as noise countermeasures. In addition, as the demand for board space saving increases, more effective noise suppression products are required. This product is effective for noise suppression and decoupling of automotive products, and contributes to downsizing of sets and reduction of the number of MLCCs. In the future, it will further expand its lineup, by increasing the capacitance, and respond to a wide variety of automotive products. Meanwhile, the East Asia region’s leading MLCC manufacturing companies are expecting doing better business after overcoming the impact of COVID-19, helped by brisk sales of new iPhone models and rising 5G smartphone sales in China. The companies include Japanese global leader in MLCC, Murata Manufacturing Co Ltd, Samsung Electro-Mechanics Co Ltd of South Korea, two leading Taiwanese MLCC manufacturers, Walsin Technology Corp and Yageo Corp. The supply-demand conditions appear tight for 0201-

AC 20-4

asian ceramics

IN ADVANCE: PHILIPPINES

size MLCC items used in smartphone products, with lead time extending to about three months, said Yageo Corp. With channel destocking coming to an end and unit prices stabilizing, customers in the distribution channel, cellphone manufacturers and consumer electronic

segments are pulling in stock, said Walsin Technology. Taiwan’s largest MLCC manufacturer, Walsin, is one of the world's largest too. Walsin is staffed with a highly potential management team and equipped with the core technologies of precision ceramic materials.

WHEN LOCKDOWN STRUCK…

enterprises and factories. According to ESMChina, Japanese and Taiwanese companies manufacture resistors in Malaysia. Huaxin Technology and Wang Quan (a subsidiary of Qilixin) have a large percentage of their production capacity in Malaysia. In addition to resistors, Japan’s Murata produces inductors and MLCCs; Nichicon and Nippon Chemicon manufacture aluminum electrolytic capacitors; and Panasonic produces solid-state capacitors in Malaysia .

When the world went into lockdown just a few months ago, the MLCC sector was hit hard and fast across the region. Philippines: MLCC capacity The Philippines announced on March 12th that the capital Manila will be “capped” (community segregation) for 30 days starting March 15th. All sea, land and air transportation to and from Manila has been suspended. Manila has three of the eight major airports in the Philippines. MLCC capacity will be hit hard. The Philippines are an important manufacturing base for Japanese and Korean manufacturers. Murata, Samsung Electronics, and Taiyo Yuden have factories in the Philippines. Murata and Samsung Electronics have 15 percent and 40 percent of their MLCC production capacity in the Philippines. In addition, the volcanic eruption in the Philippines in January has restricted air transportation, and the industry subsequently has concerns over the supply of MLCCs. According to ESMChina, Murata and Samsung’s MLCCs are mainly used in high-end markets such as smartphones, automobiles, industry, and medical equipment. The suspension of production from Murata and Samsung will have an impact on the high-end MLCC market. Murata has a global monthly MLCC production capacity of about 150 billion units. Except for Japan and the Philippines (15 percent), factories are located in Wuxi, China (40 percent), Thailand and Singapore. Samsung ’s MLCC global monthly production capacity is about 100 billion units, except for the Philippines. Apart from [that] 40 percent, factories are distributed in Busan (20 percent) in South Korea and Tianjin (40 percent) in China. However, the high-end expansion capacity of Japanese, Taiwan and mainland MLCC manufacturers will be opened through 2020, as well as factories that are located in mainland China. This can alleviate the shortage crisis to a certain extent. Yageo’s MLCC production capacity is very small in Suzhou (70 percent) in China and in Taiwan, and in Southeast Asia. Malaysia: Resistors stop production for 14 days Malaysia announced on the March 17th that it will close the country for 14 days, including transportation and public facilities, domestic

asian ceramics

AC 20-4

Wang Quan mainly produces conventional resistors in Malaysia, and its production capacity accounts for about 50 percent of its total production. Its Kunshan and Hunan factories have recovered their production rates, which can alleviate the shortage problem. Huaxin Technology’s plant in Malaysia mainly produces automotive resistors. The shutdown is expected to have a greater impact. In terms of inductors, Japan’s Murata and Chiru have factories in Malaysia. Due to the large number of participants in the global inductor market, the competitive landscape is relatively fragmented and the demand is weak. Extreme price fluctuations are not expected. In aluminum electrolytic capacitors, Nichicon has led all models of pin-type and screw-type aluminum electrolytic capacitors since 2018. Aluminum electrolytic capacitors are mainly used in industrial, automotive, home appliances, lighting, consumer electronics and other fields. Historically, the price increase has been far less than that of capacitor resistors. It is expected that the increase will be limited. Bangkok, Thailand Malaysia is a back-end semiconductor manufacturing center in Southeast Asia and companies such as Intel, Infineon, ASE, ST have set up factories in the country. Around 2018, three Chinese semiconductor manufacturers, Suzhou Gujing, Tongfu Microelectronics, and Huatian Technology announced their acquisition of a packaging and testing plant in Malaysia. In 2010, the Malaysian government introduced a series of diversified foreign investment encouragement policies since its economic transformation plan. Manufacturers such as ASE, Infineon, and ST have focused on high-margin areas such as automobiles and industry. Intel’s processor (CPU) has local capacity in Malaysia (accounting for about 50 percent of the total CPU rear-end capacity), which may exacerbate a CPU shortage. ESMChina reports that server ODM manufacturers currently had roughly 2-3 weeks of inventory.

www.asianceramics.com

Insight

USA

Table 1 China Mexico Thailand India Brazil Viet Nam Colombia Turkey Italy Japan

Table 1 2016 2017 2018 2019

40,349,186 37,131,759 42,665,826 36,733,394

Total sanitaryware imports (no. items)

Table 1 2016 2017 2018 2019

21453328 10621172 1142431 980628 454127 322595 279378 278367 193746 182997

Leading sanitaryware import sources (2019; no. items)

Table 1 17,226,909 18,479,853 20,804,712 21,453,328

2016 2017 2018 2019

Sanitaryware imports from China (no. items)

19,145,988 13,898,158 16,624,743 10,621,172

Sanitaryware imports from Mexico (no. items)

asian ceramics

AC 20-4

www.asianceramics.com

www.cevisama.com

cevisama@feriavalencia.com

8-12 feb 2021 ValĂ¨ncia â&#x20AC;&#x201C; Spain

Supporter of: Organised by:

Table 1 2016 2017 2018 2019

Table 1

832,499 973,962 972,838 980,628

2016 2017 2018 2019

Sanitaryware imports from India (no. items)

187,351 471,904 396,228 322,595

Sanitaryware imports from Vietnam

Table 1 2017 2018 2019

80,147,402 93,392,555 87,345,836

Table 1 2017 2018 2019

Total ceramic tile imports (sq metres)*

Table 1 2017 2018 2019

43,051,356 51,082,082 52,807,825

asian ceramics

Table 1 12,994,108 13,078,461 6,647,829

*water absorp8on <0.5%

Total ceramic tile imports (sq metres)*

*water absorp8on 0.5 - 10%

Ceramic tile imports from China (sq metres)*

2017 2018 2019

*water absorp8on <0.5%

30,617,479 35,309,964 20,092,232

AC 20-4

Ceramic tile imports from China (sq metres)*

*water absorp8on 0.5 - 10%

www.asianceramics.com

VIETNAM Ceramics 2020 exhibition & conference of machinery, technology & materials for manufacturing tiles, sanitary ware, tableware & heavy clay in Vietnam Co-Organised by Asian Exhibition Services Ltd., AES (UK) Limited & the Vietnam Building Ceramic Association (VIBCA) 8 – 9 December 2020 | Melia Hanoi Expo Hall | Vietnam

The 2nd

VIETNAM Ceramics 2020 moves to 8‐9 December

VIETNAM Ceramic 2020 has announced the new 8‐9 December 2020 dates as being the most suitable for the success of the exhibition and conference this year, both from an attendance and business perspective. Vietnam remains one of the safest and most buoyant ceramic markets in the world and with its strong industry there continues to be an enthusiasm and a willingness for the show to proceed and so it has been decided that the later dates of the 8‐9 December 2020 will provide sufficient time during this period of adjustments to adapt and enable the safe and successful staging of VIETNAM Ceramics 2020. It has further been decided that VIETNAM Ceramics 2020 will return to its previous venue for 2020 at the Melia Hanoi Expo Hall, also in the centre of the city, with the added advantages at this time of its five star facilities and standards, advanced visitor entry systems in place and a wide scope of onsite facilities to include dedicated conference rooms, a range of food and beverage options, a business centre and services, plus world‐class accommodation and recreational facilities. VIETNAM Ceramics 2020 remains fully supported by the Government, Association and various support groups and looks forward to welcoming Vietnam’s leading ceramic manufacturers and stakeholders for what will be a very important event for the industry in Asia this year, especially given Vietnam’s continued expansion in ceramic manufacturing and its high demand for international technologies and material supply to maintain this momentum. Find out more by contacting us directly at ceramics@aesexhibitions.com.

Asian Exhibition Services Ltd. | Tel +66 (0)2711 1767‐8 | ceramics@aesexhibitions.com www.VietnamCeramicsExpo.com

Hunter and the hunted

Start Ups in the Time of Covid.

nies but one start-up was unfortunate to It’s a very difficult time for even well-established compa the region and left the Owner and General hit -19 Covid as finalize its creation and registration just ew Michael ‘Mick’ Goodwin of MG Manager in lockdown in Thailand. AC managed to intervi faces and his hopes and concerns for he nges challe the about d Consulting and Products Limite food and beverage outlets previously nt, differe the future.   But for the past few weeks things are so they can at least remain open. g seatin their ting restric are as cinem , busy are nearly empty cancelled. There have been panic all – show y comed rt, Every art and sports event, music conce closed, people are working from home, buys of face masks, bleach and toilet rolls. Schools are hibernation. The famous harbourfront I in or ss busine of out y sadly some businesses are alread Sunday Hong Kong recorded only last ently, walk down almost daily is now nearly empty. Appar . evable unbeli ingly dropp jaw is 7000 visitors. That traditional domestic markets led directly to the print factory closure in 2005. Fortunately, many AC. So Michael, how did you come to be of the contacts and friends from my time there nd? Thaila t based and specifically Phuke are still in ceramics, several in Asia which also ‘I guess it will be easier if I explain a bit of provides a wealth of experience and business why n explai will it as my employment history contacts, ceramics can be a small world. I’ve – I decided to set up my own company Following voluntary redundancy, I was been working in ceramics and associated to act as a consultant at Beyrand print asked first My now. industries for over thirty years in Limoges, France to enable them factory job in the ceramic industry started in my supply Wedgwood print. However, ssfully succe wood Wedg at ent -On-Tr hometown of Stoke the opportunity to move full time down turned I ton. bone china factory & headquarters Barlas d opting to move to China as I instea e to Franc I started in the decorating department with would be greater business there that ed believ all ing replac and the responsibility of ordering challenging career more and s tunitie oppor the decal stock. I quickly progressed and was ic and rapidly growing dynam that in ts marke l contro took and n positio promoted to a staff market. of all the group decal ordering and moved into Desmond Chang (Concord, Inhesion & the all linking area t opmen /devel the design s brands) gave me the next opportunity variou ring prepa , decal ordering directly with design ue my ceramic experience I took the contin to decal layout’s in a new computerized format Key Account Manager to fully utilize of n positio t withou print to direct go so each order could & background at his growing ence experi my a time-consuming hand patching & camer g facilities. From the first printin decal se Chine work. This was done using the first Apple international customer entire his visited I day, Quark & shop Mac technology, Adobe Photo the technical nated coordi China in base Express. During this period, I had extensive sible for pricing and respon was and ns functio d learne and re softwa training in computerized quotations for all new customer projects. Also all aspects of screen-printing ceramic decals. responsible for managing all proofing work After 12 years at Barlaston with my computer and making certain customers received highwood Wedg to training & experience, I moved quality decals. I also attended Frankfurt with ceramic printer Precision Studios. Concord and took responsibility for the display ion Precis sold However, Wedgwood of different decal techniques and presentations e servic Studios in 2000 and so my contract & to all potential new customers. I have many continued with Johnson Matthey who was contacts from my time with both Wedgwood & ic ceram the purchaser. By this time the Johnson Matthey and so was able to introduce industry in Stoke-On-Trent was in decline companies such as Spode, Royal Worcester, due to emerging China suppliers and also S. Wedgwood & Johnson Brothers, Royal Asia Korea, Indonesia, India, Thailand (East Doulton, Crown Trent, Dudson, & Churchill the of rtion propo huge a getting generally) China. Which otherwise would not have been d finishe & print ic world market share in ceram accessible to Concord. I am still in contact products. with companies such as these regularly as their in ss busine of Sadly, for JM the loss

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

asian ceramics

AC 20-4

www.asianceramics.com

Hunter and the hunted

they have a wealth of knowledge to exploit for ceramic factories in China and Asia generally. After helping to increase international sales with Concord and travelling to see many factories in China, building steady business relationships I got the chance to further my career with Jimmy Chan at Kilncraft who I had been introduced to and I was aware that he was looking for a manager for his decal factory and someone who could develop his international business with quality brands and customers with demanding specifications such as Wedgwood, Steelite, and Noritake. By now I had both the necessary experience and skills to see this position as a great opportunity & a chance to develop business with a company that was at the time in some distress but had a good opportunity and working with higher quality brands again renewed my enthusiasm. Later I was headhunted by Paper Island China Limited to lead their overall China Operations from product development through to delivery. As they were a customer of Schablona I had worked with them closely and they realized my experience would be beneficial to their team. Given that this would be an interesting change to dealing purely decal and glass decoration I considered it an exciting opportunity and it offered greater reward financially and sourcing and working with various other materials and a different customer base. As I gained knowledge and proficiency in sourcing a multitude of products my next career move took me to the large HK Trading company Li & Fung in charge of the Hardline & Soft Home items initially for the Kohls Department stores account (USA) and after 6 months I was also responsible for the Disney Account Quality with over 100 QC staff under my supervision. I visited many suppliers all-over South-east Asian going valuable experience in every type of Hardline products and dealing with quality control, quality assurance, costings and exposure to the practices of major retailers from demanding markets.  Nevertheless, I found I was living out of a suitcase and was rarely at home, working 14or 15-hour days, getting in to find a hundred emails to answer and not knowing which city I was waking up in! It is not a healthy existence and the opportunity to move back to my ceramic roots after nearly 2 years with Li & Fung came along as I was offered

a position by Kennex (HK) Limited. My role was to improve their decorating factory in Dongguan and make it efficient and effective as it had faltered due to some poor middle management and bad practices. The Kennex factory has 200 workers with the capability to do decal decoration and also glaze decoration, Kennex buys from 20 factories in China with various quality standards and my role was to improve quality through the supply chain and also at their facility. It was very demanding and fraught with all manner of sensitive political and personal difficulties and decision making. So much so that at times I’d have to negotiate with police, local authorities…deal with environmental issues or even staff corruption and criminal activity. Whilst it can be rewarding it is very stressful and not many people understand how it can leave you fatigued and affect your health.

Eventually, I had to return to the UK for a while to spend more time with my elderly parents but after a couple of years working in the UK, another opportunity to work in China presented itself. returned to China & HK after a 2-year break but I soon realized that both counties had changed massively from when I first arrived in 2005. Looking back on it after the development and growth in China some things changed for the better (infrastructure and so on) others not so good, politics, attitude, censorship things of that kind and importantly the way foreigners were viewed. I had a brief spell setting up a company for Doulton Water CONTINUED ON NEXT PAGE

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

www.asianceramics.com

AC 20-4

asian ceramics

Filters and during this period I decided that I needed to move away from China and look for a challenge in new surroundings. I had learned so much from being able to make a decal to ordering supplies to managing supply chains and factories. I thought it was time to do something for myself rather than working for someone else. AC. Why at your age did you decide to go it alone and set up a new ceramics Ad Specialty & high-value tableware company? After looking at the options I had available I decided that I wanted to start my own business as I had years of experience covering all aspects of tableware, decoration and quality control, costing and so on. Now even before Covid-19 outbreak things in China were very different than previously with new visa rules making it more difficult for Foreigners to obtain the correct residency and status and the feeling was of not been welcome. Chinese factory owners have increasingly acted as they don’t need foreigners or their advice and recommendations anymore.  AC. Why Thailand & why Phuket? Market size & dynamics? Ease of setting up?  I had visited Phuket many times for holidays during my 15-year stay in China and decide to explore the opportunities there, I soon discovered that there is lots of investment and developments in Phuket with 24 new 5-star hotels being completed in 2020 alone. With the high-end brands and chains of hotels and restaurants after visiting most seem to all use the same basic ware from the two main suppliers in Thailand (Royal Thai & Patra). I could see that there is a space in the market to offer a premium quality international brand like Noritake so I decided at this moment to proceed with setting up my company. The set up took around 4 months for company registration and obtain a working permit for Thailand; the process is easier than China but takes a lot longer to complete. Noritake permitted me to sell in Phuket because they have distribution already on the mainland so with my other ceramic connections that I have I can offer other brands from all-over SouthEast Asia. I also supply fired onglaze bespoke branded ware with company logos after seeing a large number of coffee shops clubs and tourist attractions in Phuket that don’t take advantage of such marketing.

AC. What are your views on the potential demand – when you decided to set up? With all the investment in Phuket for High End like Banyan Tree, Twin Palms, InterContinental Wyndham group and also Phuket has 5 main marinas with the Boat industry another potential customer for marquee ceramics, Noritake also offered to supply both small and large quantity with enables me to target all types of customers there is an unrealized demand there to be sure though of course at this moment with Covid-19 restrictions it is very difficult – that won’t last forever.

AC. So post Covid-19 how do you think the market will be able to recover? Well, after my waiting 4 months to set up the company registration the COVID – 19 virus hit Thailand and Phuket has been closed off for two months but things are very slowly starting to get back to normal. My initial thoughts are that it will certainly take time for tourists to return and hotels & restaurants will be running on reduced occupancy may be as low as 20-40%, I am sure that many will survive but unfortunately, there will be some casualties and closures. But the Thai authorities are looking at ways to help out with talk of special economic zones and more importantly longer visas and easier processes for tourists and targeting tourist groups that are lower in volumes but looking for high-class standards of accommodation and services. This will fit it with my Noritake and brand ideas. I’m not sure like everyone else what will happen there

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

asian ceramics

AC 20-4

www.asianceramics.com

are so many things that will change and who knows what the new normal will be? But companies in the tourism and entertainment industries will need to take advantage of marketing opportunities advertise more and get their name known. AC. MGCP sources ware from where? What advantages do your suppliers offer you especially looking to the future/postCOVID-19?  As well as the Noritake supply direct from their main factory in Sri Lanka, I have supply from Kilncraft in HK for the logo and branded bespoke ware and options of supply from Sri Lanka, Bangladesh and also some local Thai factories to suit all customers and cover all cost points. AC. Things are going to be difficult as we enter ‘recovery mode’ – what advice would you offer to potential customers about rebuilding (marketing, brand building etc.). The way business is done will change as we start to get over the virus and get moving again, and a lot more will be done from home as people have discovered over the last 2 months that travel is not a necessity and companies will have to save costs and employees will also not be so willing to travel to certain countries. Even getting insurance for that could be an issue. I also think that markets and countries will split into regional bubbles and trading partners will change and rightly or wrongly the huge China supply chain will be affected and shrink in size with people moving out to other South East Asia countries.  I think that the days of buying the cheapest products that don’t last and are disposable and thrown away and replaced often are gone. It is too wasteful of resources. What people will be looking for if they are going to spend will be higher quality products that last and are durable – they won’t want to waste hard-earned money. They will have to be given a good reason to spend. AC. Generally, what are the dangers for the industry in Asia right now (retail and hospitality not just ceramic supplies)? The situation with airlines and travel is a massive problem that everyone around the world is facing and unless there is a vaccine

I’m not sure if much international travel will resume shortly and the hospitality industry will certainly change until we know how supply chains and travel will be fully affected there is uncertainty. Retail in most SouthEast Asian countries will come back strong but again it will take time, retailers still have stock from previous seasons and orders will certainly not be placed until the back end of 2020 but I still think that in Asia people will go out and visit stores again soon as it’s a hobby and social interaction too. For hospitality, unfortunately, it will take deep pockets for owners to be able to afford to carry on paying rents and staff wages and running costs on a reduced customer level and they will have to hang in there or close down. But keeping people employed means they too become the customers again. So, we need to be here to take advantage when the recovery begins. AC. What would be the worst thing that customers and supplier could do post Covid-19? No matter what everyone has to look at costs and try to get through this situation the simple answer is change will happen so plans for this have to be in place and under consideration. I think that supply chains will change to nearer options to the customer. It is also possible that China’s economy will crash and the worldwide knockon effect will be massive.  My thoughts are the high-end market will survive and possibly grow in Phuket the lower end will take longer to recover and need new supply chain alternatives and hopefully with the quality products I have from Noritake I can survive and like everyone else hope that other sectors get back to something approaching normal quickly. It is no use being defeatist – the situation may be tough but there are some opportunities that need to be grasped.

COMPANY FEATURED: MG Consulting & Products Ltd https://www.mgcp.info Head Office: MG Consulting & Product Co., Ltd. (Head Office) 74/210 Poonpol Road, Taladnuae Sub-District, Muang Phuket District, Phuket Province 83000 Thailand

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

asian ceramics

AC 20-4

www.asianceramics.com

Where Innovations Thrive

The 35th Edition of China Int’l Exhibition for Ceramics Technology, Equipment & Product

June 22-25, 2021 Area A, Canton Fair Complex, Guangzhou

Tel: 0086 – 20 – 8327 6369 / 6389 Facebook: @Ceramics China Web: www.ceramicschina.com.cn

Email: ceramicschina@unifair.com Twitter: @ceramics_china

In the next issue... AC20-5 Features include

• Egypt: a sanitaryware centre • When thin, wins: porcelain tile options • Indonesia: a country in focus • Roof tile markets in the Middle East • STATE PROFILE: Maharashtra is this your own issue? sub

scribe online at www.asian

www.asianceramics.co

is this your ow

n issue? subs

cribe online at

AC20-5 mics.com www.asiancera

ceramics.com

is this your ow

amics.com

www.asiancer

AC20-5

n issue? subscr

www.asiancer

AC20-5

SE E US AT:

amics.com

ibe online at ww

w.asianceramics

.com

VI ETNAM C E R A M I M CS A N T VI E HAN OI V I E T N AM S C I M A R CEOI C E RAM I CS HAN

S E E U S AT:

HAN OI

us FatOCUS: Se e IN

Roof tile markets : Porcelain tile advantag S U C MesICS I N FO yptian RA sanit ary VIETNts A MEgCE

ke ware Roof tile mar Indonesia in focus es ag nt va ad e ws, vie Porcelain tilPlus ne arews, analysis and much mo nitaryw re! Egyptian sa s cu fo in a si Indone uch more! alysis and m an s, ew vi s, Plus new Plus news, vi

HANOI

AC COVERS.indd 1

01/09/2020

01/09/2020 11:10

11:10

d 1

AC COVERS.ind

d 1

I N FOCUS:

Roof tile mar kets Porcelain tile advant ages Egyptian sani taryware Indonesia in focus ews, analysis and much m ore!

PLUS: news, views, analysis and much, much more! 01/09/2020

11:10

CAN YOU AFFORD TO MISS OUT?

T: + 44 (0) 208 123 0839 E: enquiries@asianceramics.com

www.asianceramics.com

High-glossy TREATMENT TECHNOLOGY is a technology that creates a chemical-physical reaction made by pressure and temperature where the product penetrates into the porosity of the glaze and guaranty the high glossy and protection.

INFINITY Series

Double-Decker KILN

INFINITY Series

Introducing the all-new

INFINITY

Series Thermal Equipment

for Sintered Slab production line Modena Technology Limited www.modena.com.cn

7- Layer DRYER