Asian Ceramics AC20-5 by Bowhead Media Ltd

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AC20-5

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Roof tile markets Egyptian sanitaryware Indonesia in focus State Profile: Maharashtra Plus news, views, analysis and much more!

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Contents: AC 20-5 News

Features

4 Inside Asia

24 Indonesia in focus

Colorobbia leads a “green” revolution in ink…

6 Welcome Problems mount for the trade-show sector.

8 Across The Continent

Openings, closures and industry moves from across Asia.

14 International News Our eye on the international arena.

18 Material Matters

Special reports from Imerys and Sibelco.

22 Comment & Analysis

Jahir Ahmed reflects on how years of turmoil as costs and market pressures grew have potentially come to an end for the archipelago, and Indonesia could be set to regain its position as the ever-expanding ceramic giant of South East Asia.

46 Roof tiles in the Middle East

AC looks at how a slowdown in construction activity has forced the roof tile sector into retreat. As costs begin to fall, will the region be able to turn around its fortunes?

56 Egyptian sanitaryware

Yogender Malik examines how the North African-based, but Middle Eastern prevalent, Egyptian sanitaryware industry appears to be turning a corner and positioning itself for a strong, post-Covid recovery…

Can a procurement programme motivate Sri Lankan firms?

Analysis 64 Talking Shop In this issue’s Talking Shop, AC discusses with two of Asian continent’s major ceramic material suppliers about how they have managed to cope with this year, and what their plans are for the post Covid-era. Natesh Krishnan, General Manager, Engineered Ceramics of Saint-Gobain Performance Ceramics & Refractories in India and Danny Tsai, Special Assistant to the Managing Director of China Glaze Co. Ltd in Taiwan spill the beans…

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68 State of the Nation: Maharashtra 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 aerospace ceramic carbon fibre in South Korea.

74 Insight

Analysis and insight into Russia.

76 The Hunter And The Hunted

William Hunter looks at a lock-downed world and demands for a new, “new normal”…

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Inside Asia Colorobbia leads a “green” revolution in ink… Gruppo Colorobbia's eKo series is a new generation of organic-based digital inks, designed for Ceramic manufacturers seeking maximum production efficiency with a lower environmental impact. Today's society values eco-sustainability more and more when it comes to the purchase of ceramic products, that is why Colorobbia has always been a benchmark group for the technological improvement of its production processes to curb climate change for our planet, placing health first and so offering the desired product by the end customer. Similarly, the eco-sensitivity of a ceramic tile brand is a distinguishing and increasing added value which, together with ceramic products elegance, durability and functionality, is a guarantee of success. Obviously, we remain convinced that water-based ceramic inks, especially our AIR series, are the best solution to environmental problems when this technology performs reliably in the ceramic industrial environment. But we expanded our range with the new eKo series, an intermediate but immediate step, suitable for today's digital machines. With the new eKo series, Gruppo Colorobbia provides an efficient use of materials, maintaining excellent and safety performances in single-firing production lines around the world. The range of special materials

and colours is wide, always with the highest quality at all stages of its production. Its high performance not only reduces ink consumption but also limits the excess of applied organic substances. For example the reduction of 20% in the ink grammage can mean a reduction of 25% in organic and therefore of the carbon trace left by the inks. The nature of the atmospheric emissions in the kiln chimneys, which is undoubtedly related to the solvents chemistry of the inks and the amount of applied organic, also depends, among other factors, on the humidity of the substrate, the firing cycle, the kiln atmosphere and weather conditions. In Colorobbia, we cannot control all these variables, but we do control the composition of our digital products. The new eKo series is formulated with organic solvents of vegetable origin, without hydrocarbons, without odors and without glycol ethers. Its high decomposition temperature together with the reduction of applied organic promote a complete combustion inside the kiln and lower the levels of formaldehyde and odors coming out of the kiln chimney. In addition to the high ceramic performance, the efficient use of materials, the reduction of atmospheric emissions, Colorobbia’s eKo series offers a complete solution to minimize waste and eliminate single-use plastic. Therefore, in accordance with the new market regulations, Colorobbia gives an advantage to its customers. The environmental preservation and the people safety have been part of the Colorobbia Group's DNA since its foundation in 1921, always at the side of its customers, producing quality products committed to environmental sustainability.

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he news this month that Ceramitec SEE US AT: – the Munich-based ceramics technology event that operates on a triennial basis – has postponed next HANOI year’s event to 2022 brings into stark focus the perilous state of the global events business at this time. The trade show sector – in all industries – has been hammered, with 100% IN FOCUS: of revenues denied overnight. Indeed, it almost Roof tile markets Egyptian sanit aryware seems unimaginable given the current state Indonesia in focus State Profile: Maharash of affairs, that we will see ourselves shaking tra Plus news, views, analy sis and much more! hands, welcoming customers and mingling in crowds numbering in the thousands any time soon. Of course, it will return and we will look back at these days and learn some valuable lessons. However, for now, this remains something of a distant hope, and until a vaccine is unleashed and international business travel can become the norm again, then exhibition organisers have simply got to hang in there. For us here at Asian Ceramics, we cannot deny that we are relieved that we exited the trade show business a few years ago, when we sold our Indian Ceramics event to Messe Muenchen and our Gulf Glass and GulfSol brands to DMG Middle East. However, we have huge sympathy with all our exhibition partners across the world, from India to China, Germany to Italy, Spain to Indonesia and beyond for the difficult – some would say impossible – situation that they currently find themselves in. We know, from our own experience, how much effort and energy is put into making the trade shows for which industry is so dependent; effort that is perhaps not always fully realised by those who attend or exhibit. In some of the most difficult places to operate, trade shows have been founded and have flourished; opening doors to markets that would otherwise have been far tougher to break into. With the absence of trade shows of course, then “regular” promotion and advertising becomes even more important. The ceramics industry has not stopped; sanitaryware is being fitted, tiles are being made, tableware bought (although in smaller quantities at the moment as hospitality issues bite), and therefore the need to expand and modernise remains as great as ever. It would be wrong for companies supplying the industry to think this is a time to batten down the hatches; far from it. This is a moment to look forward, grow a presence and develop new customers and the importance of a steady marketing message remains key. Without trade shows to receive new customers, then the more traditional forms of communication are increasingly important again – namely, advertising. We look forward immensely to some normality returning to the World, but in the meantime we applaud the decisions of many exhibition organisers across the globe who have taken extremely difficult commercial decisions to postpone events until such time as they can operate without restriction. I am certain that we are all in agreement on that.

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

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Raw material shortages a cause of concern • Tile demand boosts local suppliers • Association urged to “remove dut tile exports from Morbi • Tile producers upbeat about demand rise • Much needed relief for Morbi based ceramic p with System • Cleopatra makes inroads with Imperial... BANGLADESH

Raw material shortages a cause of concern The availability of quality raw material is one of the most critical success factor in ceramic industry. Bangladesh based ceramic producers are facing a number of challenges in securing high quality raw materials. According to Khourshed Alam, Director, Sales and Marketing at Akij Ceramics Limited, “ Bangladesh’s ceramic industry is facing challenges like overreliance on raw material imports

and inconsistent gas supplies. More than 90% of the raw materials are purchased from abroad and the duty structure for this import is not favourable at all. For example, clay is the main ingredient for ceramic products and we have to pay duty on the total volume of our purchase. But the clay we are bringing in contains more than 30% moisture. Which means we have to pay duty for 100% of the import of which only

70% is usable. This is a huge loss that adversely impacts our production cost. This gap needs to be rectified. Also, our government should rethink the tariff value of imported tiles to protect the local tiles industry. It was at 6-12 taka/S.Ft but in this budget, it came down to 5-11tk/S.Ft which will reduce the price of foreign tiles by 10% and increase competition for the locally produced tiles. This is not a good decision for

our industry.” Natural gas is the lifeline for the ceramics industry as it is important for burning the ceramic items at a very high temperature. An uninterrupted flow of natural gas is a must to maintain quality but Bangladesh’s ceramic producers hardly get desired supply of natural gas which forces the companies to invest in their own CNG and coal facilities increasing their production costs significantly.

SAUDI ARABIA

Tile demand boosts local suppliers Ceramic tile producers based in the Middle East region have been witnessing demand revival from the largest ceramic tile consumer in the region, Kingdom of Saudi Arabia. In April, the GCC Industrial Cooperation Committee approved the imposition of antidumping 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 are between 23.5 per cent and 76 per cent. The measures came into force on June 10. Regions’s largest ceramic tile producer, RAK Ceramics said in a statement, “ The imposition of anti-dumping duties on tiles imported from India and China and the reopening of Saudi borders in June supported increased demand for RAK Ceramics products. But across all the markets, only Saudi

Arabia showed a plus in the second quarter. There were revenue declines in April and May as the business began to feel the impact of lockdowns and reduced demand in the construction sector.” Company’s production facilities in UAE have started normal production since the beginning of July. Production has restarted in Bangladesh and India in phases, but the tableware business has

BANGLADESH

Association urged to “remove duty” on sanware Bangladesh’s sanitary ware producers have demanded withdrawal of the proposed supplementary duty (SD) on sanitary ceramic products to help protect the local industry amid the Covid-19 outbreak. The proposed national budget recommended imposing a 10 per cent SD on ceramic sink, basin pedestal, commode, toilet pan and fittings of bathroom and fixtures. "We will fail to keep up with

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the foreign products if the supplementary duty is imposed now. The new SD will create pressure on the industry at a time when it is struggling to survive, "according to Irfan Uddin, general secretary of Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA). Bangladesh has 68 ceramic manufacturers, of whom 61 are currently active in production. Twenty of them produce tableware, 25 tiles and 16

sanitary wares. The local industr y produced over 250 million pieces of tableware, nearly 200 million square metres of tiles and over 8.3 million pieces of sanitar y ware in the last fiscal. Around Tk 35,000 crore wor th of ceramic products were sold in Bangladesh in 2019 and it has experienced a 200 per cent growth in production in the last 10 years, according to the association.

been "severely impacted" because of the slowdown in the hospitality and airline industries. Tableware business is currently operating at 65 per cent capacity. The company reported a loss of Dh11.6 million for the three months ending June 30, compared with a Dh61.2m profit in the same period last year. RAK Ceramics' revenue for the period fell 37 per cent to Dh411.3m.

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ty” on sanware • MTC invests in XJet to bolster capability • Record ceramic producers • SSI and SNK opt for robotised glazing • New Pearl presses on ISRAEL/UK

MTC invests in XJet to bolster capability XJet Ltd. has announced that the Manufacturing Technology Centre (MTC), will add XJet NanoParticle Jetting™ technology to its portfolio of additive manufacturing (AM) technologies at its facility in Coventry, UK. Determined that the global coronavirus pandemic will not slow progress, the Carmel system has been shipped to MTC and is scheduled to go live in the coming few months. Established in 2010, the MTC is an independent research and technology organisation (RTO) that provides integrated manufacturing system solutions for customers large and small across a diverse range of sectors. The MTC hosts the National Centre for Additive Manufacturing (NCAM) which accelerates the adoption of AM by developing the technology and systems required to industrialise AM. Ceramic AM is a key focus area for the NCAM,

with the recently published whitepaper highlighting a route to widespread adoption for the UK. According to Dr Tom Wasley, MTC Senior Research Engineer, XJet successfully demonstrated the ability of the Carmel 1400C in producing premium end-use ceramic parts and scaling up for production, thus making the machine an ideal addition to its existing AM capability. Wasley explains, “XJet’s NanoParticle Jetting technology delivers very high-density parts, so users can have confidence in the materials. Designers often feel the need to ‘overengineer’ AM parts for basic applications, for instance using thicker walls so parts are less fragile, because they are using AM materials, not the real thing, but this is not the case with XJet. In addition, the large build platform, the lack of interaction with powders and no extra step needed for debinding,

scaling up for volume production is easily achievable with minimal time and labour.” Quizzed on the capabilities of the new XJet system, Wasley says, “The surface finish that can be achieved with XJet is arguably very hard to replicate with any other kind of additive process. It also provides a means to make small, intricate and extremely detailed parts.” MTC’s Carmel 1400C system will enable the manufacture of ceramic parts that are highly complex. Components will feature superfine details, smooth surfaces and pinpoint accuracy – making the promise of zero-cost complexity a reality. Wasley goes on to affirm the real market need for these kind of parts, stating, “There is a high demand for parts like this in the aerospace, medical, dental and defence industries, some businesses are interested in

high precision tooling, but largely they’re looking for end-use parts. We’ve been working in ceramics for over six years, and now we’re looking forward to growing our inhouse AM capability. A lot of the organizations that are interested in ceramic manufacturing are searching for a means to batch produce custom, personalized products and the volume capability of the XJet printer will help to realize this need.” XJet CBO, Dror Danai, states, “We develop our technology so companies can easily move from one design to another, at any point in the manufacturing process, with true freedom of design and zero-cost complexity. However, it’s organisations like MTC that will push the technology to its limits and see what it can really do, make possible what was previously impossible. We’re very excited to work together and see how MTC applies the technology.”

INDIA

Record ceramic tile exports from Morbi Covid 19 has created an unprecedented situation in the global ceramic tile industry. Lockdowns in many parts of the world and slump in construction activities in most of the geographies has dampened the ceramic tile production and consumption in most of the countries. However, bucking this trend, ceramic tile producers from India’s Morbi have been able to export record volumes of ceramic tiles in the month of July. Though, the exact export figures for the month are still awaited, but the certificate of origin issued to ceramic tile producers from Morbi by Rajkot Chamber of Commerce & Industry ( RCCI) claims that the export

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in the month of July doubled as compared to the figures of July 2019. RCCI issued a total of 81 certificates of origin in July 2020 against a total of 41 certificated in the month of July 2019. In June 2020, RCCI had issued a total of 40 certificates of origin to Morbi based ceramic tile producers. On an average about 40 certificates of origin are issued to Morbi based ceramic tile producers. Going by past trends, 40 certificates account for nearly INR 10,000- 12,000 million of ceramic tile exports per month. Extrapolation of 81 certificates issued in the month of July 2020 translates to about INR 20,000- 24,000

million of ceramic tile exports. Ceramic Tile exports from India in Financial Year 2019-20 According to the ceramic tile producers of Morbi higher exports in the concluded month has been due to prevailing anti- China sentiment and low production in European ceramic hubs of Italy and Spain due to lockdown measures of previous months. Morbi was Country Saudi Arabia UAE USA Mexico Nepal

badly hit by the migrant workers exodus in the month of April and May. However, industry associations and individual producers have worked hard to bring back the migrant workers. A number of tile producers made arrangements including sending buses, paying for train fares and reimbursing fare of private vehicles to bring back the migrant workers.

Tile exports in INR million 13,800 8,601 5,915 4,791 4,692

Tile exports in USD million 184 115 79 64 62

News

THAILAND

SSI and SNK opt for robotised glazing SSI and SNK, two Thai sister companies and part of the SCG Group, have invested in automated glazing lines for sanitaryware to achieve top quality product, safety and environmental sustainability.  Supplied by SACMI-Gaiotto robotized glazing, this international market leading technology in the sanitaryware sector is now playing an important role in Thailand where 3 new glazing cells have recently been supplied to the sister companies SSI and SNK, part of the SCG Group.     One of the cells was supplied to SSI, where SACMI has also installed five other identical solutions in the past, and the other two cells

have been started up at its sister company SNK. The cells are each equipped with a latest generation GA-OL model glazing robot installed on a 4-position carousel.      The latest GA-OL model is specially configured for  off-line programming of glazing recipes  to speed up the development and timeto-market of new products without inter fering with the productivity of the line. Thanks to GA-OL, optimization of glaze consumption is achieved alongside high process repeatability whilst always guaranteeing top quality product.     The new cells will be dedicated, in particular, to  glazing of WCs  which the

company sells both on the local market and abroad. This new project is part of a joint investment program by the two companies with the objective of creating an automated process through the very best international technology in order to ensure quality, safety in the workplace and environmental sustainability.       For this reason, the glazing booths supplied are provided with a mass control device to control the flow-rate of the glaze being applied and a dry filter systemto recover the excess glaze powder and eliminate washing water residue  to be activated when glazing. Furthermore

the GDA80 spray-gun is SACMI’s special needlefree solution to reduce glaze overspray requiring zero maintenance.     With this investment the mother company Siam Cement Group (SCG), one of the most important Thai companies operating in construction and several other sectors, has given a  strong signal of its commitment to the sanitaryware branch of its business where its two controlled companies SSI and SNK already  operate with great success as quality manufacturers of sanitaryware for both the domestic and  export markets.

PAKISTAN

Tile producers upbeat about demand rise Pakistani ceramic tile producers are expecting a surge in ceramic tile demand in the domestic market as the federal government is aiming to revive the economic activities affected by the coronavirus pandemic through housing and construction sectors.  Banks have been asked to allocate 5pc of their advance por tfolio for the construction sector, while the government intends to provide PKR 300,000 per unit subsidy to

the first 100,000 units built under Naya Pakistan Housing Scheme. This will be conjoined by low rate financing of 5pc and 7pc for 5 and 10-marla houses, respectively. The government’s directive is expected to increase liquidity towards the construction sector by PKR 300-350 billion. According to Agha Tajjamul Hussain , Chairman of National Tiles and Ceramics Limited (NTCL), “Demand for domestic tiles is expected to

increase by at least 35-45pc as Naya Pakistan Housing Scheme progresses. A number of traders have stopped impor ting tiles since the government had increased the duties on impor ting tiles (customs duty 20pc, regulator y duty 45pc, additional customs duty 7pc, sales tax 17pc, additional sales tax 3pc, income tax 6pc and antidumping duty 36pc). Secondly, the rupee depreciated against the dollar due to which people

also stopped impor ting tiles from China.” In Pakistan over 28 percent of the market is taken over by impor ted tiles, mainly from China. European and other producers have only a fraction of the market, which is estimated to be below one per cent. Smuggled Iranian ceramic tiles constitute a little more than 13 percent of the market and the rest of the market is shared by local producers.

INDIA

Much needed relief for Morbi based ceramic producers Natural gas price reduction by the Gujarat government may provide much needed relief to ceramic tile manufacturers in Morbi. Gujarat government recently announced a reduction of Rs 2.5/scm in natural gas prices to Rs 25/scm. This decision to reduce price follows earlier decision to cut gas prices by Rs 2/scm in June 2020. Gas price reduction may enable the tiles manufacturers to go for price cuts in the domestic market

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which has failed to recover post relaxation of lockdown norms. Tile demand pickup has been very weak in metro cities as it is currently at 40-60% of previous year levels as against 60-80% for non-metro cities. All these days, pricing by the branded players has been stable (for the final consumers), though they have reduced the discounts/ schemes for the dealers which has reduced their margins by 2-3%. Further, in June Morbi players

had increased the prices by 3-5% which may be rolled back due to the current gas price reduction. Gas price reduction may also help the Morbi players to be more competitive in the international market and may help to boost their exports. Of late, Morbi manufacturers of tiles are reportedly getting more enquiries from the international customers who want to spread their sourcing points beyond China. On the whole, tiles manufacturing

in Morbi is limping back to normalcy with capacity utilisation is slowly reaching to pre-Covid levels. Also, the labour issue is getting sorted out as the migrant workers are coming back to work. After the recent concession of Rs2.5 in the gas bill, the total discount now comes to Rs4.5 per SCM. This means gas will be available at Rs24.91 per SCM for the ceramic units. This is 16% lower than the gas price in May 2020.

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CHINA

New Pearl presses on with System An important supply involving pressing technology has been signed between New Pearl, the largest tile producer in China, and System Ceramics, thanks to its branch, System China. New Pearl has chosen the advanced Superfast pressing system developed by System Ceramics for the production of slabs. Superfast is the first moldless press in the world, unique for flexibility and high productivity and for the efficient software management system that makes it possible to establish and modify the slab’s format and thickness parameters in a simple and rapid manner, without any mechanical intervention. The Chinese group, New Pearl, leader in the production of tiles with innovative factories in the region of Guangdong, has identified System

Ceramics as an ideal partner for continuing its technological development program in the context of large formats that began with the Lamgea system in 2017. In more detail, the new system dedicated to the production of large-format slabs will involve two Superfast presses: Superfast 19000 and Superfast 25000. Already in operation, Superfast 19000 has been installed in remote mode, thanks to the innovative technologies developed by System Ceramics in the context of remote working and smart assistance. The second press, Superfast 25000 (1200x3600mm), will soon also be installed at New Pearl in remote mode, confirming the success of the previous installation operation.

It’s an undertaking that requires synergy between the customer, the Italian headquarters and the branch, System China, whose punctual and attentive service in the Chinese territory is an added value. Despite the fact that the international market is going through a delicate period, New

EGYPT/UK

Cleopatra makes inroads with Imperial British bathroom manufacturer Imperial Bathrooms has appointed Graham Bucktrout as its new managing director. Bucktrout’s appointment is part of a company restructure and ambitious growth plan set in motion by new owner Lousada Plc. As part of its commitment to investing and advancing the brand’s British manufacturing facilities, Bucktrout’s appointment also set in motion a merger between Imperial Bathrooms and White Ville Ceramics – an Italian-designed brand of contemporar y sanitar yware, manufactured in Egypt by Ceramica Cleopatra. The move signifies a major step for Egyptian-made sanitar yware to compete in the growing UK market. Speaking about his appointment and the launch of the White Ville brand in the UK, Bucktrout said: “I’ve

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been developing a range of sanitar yware with the makers of White Ville – the largest manufacturer of sanitar yware in Egypt – for the last two years. I’d been looking for a home for those products and one of my ongoing discussions was with Imperial Bathrooms as it was looking to strengthen its structure and move the business for ward. “It’s a great marriage of two fantastic opportunities – for me to return as managing director to focus the business and lead it into the next chapter but also to bring the White Ville range of sanitar yware to the UK market. White Ville product – which will sit just below the likes of Roca, Duravit, Rak and Vitra is innovative, it is high quality and it brings something new to the UK market. Bringing the White Ville brand on board enables Imperial bathrooms to appeal to a much wider market both in terms of style and price point.”

According to Bucktrout, his plan is to treble the size of the business over the next threefive years through continued investment in the Imperial Bathrooms manufacturing side but also by creating new opportunities and new channels to the business. “The business currently turns over just shy of GBP6million per year and the plan is to grow it to an GBP18-20m. business in the next three-five years,” he said. Egypt's exports of sanitar yware and ceramics hit US$64m. in the first quarter of 2020, down 13.5 percent from the corresponding period of 2019.    Libya, Germany, Yemen, Britain, Jordan, Turkey, Sudan France and Saudi Arabia take 72 percent of Egypt's sanitar y ware and ceramics exports, according to a report by the Export Council for Building Materials, Refractor y & Metallurgy Industries.

Pearl’s choice confirms System Ceramic’s role as a leader in industrial automation for the ceramics sector. Its processes are chosen by the most important producers at international level, knowing that they can count on the best systems solutions for the ceramics industry.

NEWS IN BRIEF The Malaysian government is starting a safeguard investigation on imports of ceramic floor and wall tile products into the country, says the International Trade and Industry Ministry (Miti). It said there was sufficient evidence of serious injury caused by increased imports to do so following a petition from the Federation of Malaysian Manufacturers – Malaysian Ceramic Industry Group received on July 16 requesting for a global safeguard investigation on these imports. In accordance with the Safeguards Act 2006 and its related regulations, a preliminary determination will be made within 120 days from the date of initiation. “If the preliminary determination is affirmative, the government will impose a provisional safeguard duty at the rate that is necessary to reduce the effects of serious injury to the domestic industry caused by the imports, ” the ministry said.

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International News

Trade-shows postponed in Q1 ‘21 Germany

s a result of the course taken by the pandemic, Messe Frankfurt will not be holding any of its own physical trade fairs at the Frankfurt exhibition grounds between January and March 2021. The company is revamping its spring trade fair calendar to focus on new synergies and new digital offerings. Messe Frankfurt has already organised 13 large trade fairs at various locations in China since the crisis began. Unfortunately, however, it is not possible to hold such events in Germany at present. This is in spite of the fact that exhibition halls are amongst

the safest enclosed buildings in which people can spend time without being subjected to an increased risk of infection. The halls can be continuously resupplied with fresh air, and in conjunction with the measures included in our extensive hygiene concept, people could safely do business in person here on the Frankfurt exhibition grounds. However, now that it is not only governments tightening travel restrictions, but also companies, the latest pandemic developments are causing growing uncertainty amongst trade fair customers. Wolfgang Marzin, President

and Chief Executive Officer of Messe Frankfurt: “It is important for our customers that we make a decision at an early date, as it would otherwise be time for them to begin investing in their trade fair presentations. Messe Frankfurt will continue working closely with its customers to ensure that its decisions serve the interests of the exhibiting industries.” That is why Messe Frankfurt has reacted to tightened travel restrictions by revamping its spring 2021 trade fair calendar for Frankfurt. As such, the leading sanitaryware exhibition, ISH, will be taking place as a purely digital

event in 2021, with a wide range of digital features on offer. These include exhibitor presentations (products, information, videos, contact persons, chat functions and one-to-one video calls), intelligent matchmaking that delivers suitable business partners for AI-supported lead generation, live streams and on-demand broadcasts of the supporting programme, and appointments for online meetings with exhibitors. And all of this will be available round the clock throughout the event, worldwide and in every time zone. More information will be available soon.

Pressure on government to help ailing tableware United Kingdom

overnment departments and the NHS should splash out on Stokeon-Trent-produced tableware – to help save the pottery industry from its Covid slump. Staffordshirebased manufacturers and local MPs have come up with a recovery plan for the ceramic sector which they want to government to carry out in order to protect thousands of jobs in the city. They want the public sector to 'lead by example' by purchasing crockery made in Stokeon-Trent, rather than cheap foreign imports. Other proposals include a pottery scrappage scheme, which would see businesses such as hotels and restaurants paid to recycle chipped and cracked tableware and replace it with Stoke-on-Trent produced goods. Hundreds of job cuts have recently been announced at a number of Stoke-on-Trent based manufacturers, including Churchill China, Steelite and Portmeirion, as demand for their products has fallen during the pandemic. Along with the use of public sector spending power to prop up the industry in the short-term, the recovery plan also includes longer term proposals, such as increased government investment in

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research and development, tax breaks for businesses, such as house builders, which 'buy British' ceramics, and expanded export opportunities. Stoke-on-Trent South MP Jack Brereton, who has delivered the plan to the government, believes the government needs to help the ceramic industry bounce back from the pandemic. He said: "Some of the measures in the plan are short-term, to help the industry recover from the massive impact it has taken from Covid-19. But we also want to see more investment in research, in the advanced materials side of the industry. This will mean higher skilled and better paid jobs in Stoke-on-Trent. "As well as encouraging people and businesses to buy Stoke-onTrent-produced ceramics, we also want the government to buy more. It may be cheaper in the short-term to buy cheap knockoffs from China, but tableware produced in Stoke-on-Trent is more cost effective, as it will last longer. "Our ceramics are durable and chip-resistant – some items produced by Steelite has a lifetime guarantee." Mr Brereton worked on the plan with fellow city MPs Jonathan Gullis and Jo Gideon, along with

local firms such as Portmeirion, Heraldic Pottery, Steelite and Lucideon. The document says that many producers are facing a cash flow crisis, as orders have dried up but staffing and energy costs have stayed high. The recovery plan states: "Stokeon Trent is world renowned for its ceramics industry. Our city is where the modern massproduced pottery industry was founded by the likes of Josiah Wedgwood and Josiah Spode. To this day, names like Wedgwood and Spode are known around the world for their ingenuity and quality ceramics. "Sadly, the sudden global Covid pandemic hit our ceramics industry and our fantastic manufacturers now face major logistical and commercial hurdles as they try and recover. They are struggling with cashflow. Orders have dropped significantly over the past few months and manufacturers are still having to fork out significant running costs on energy and equipment." Manufacturers such as Steelite are dependent on the hospitality sector, which was hit hard by the coronavirus lockdown. The recovery plan calls for a government-backed scheme to help both industries, which

would see customers who buy Stoke-on-Trent-produced ceramics receive vouchers for local restaurants. Another proposal would see tax relief offered to housebuilders in the form of capital allowances they can claim on locallyproduced ceramic tiles. The recovery plan also calls on the government to grow markets for the ceramic industry's exports, which totalled £180 million in 2016. More than half the sector's exports currently go to the EU, and the British Cermamic Confederation has repeatedly called for a tradel deal to be secured by the end of the year. But Mr Brereton does not believe the growing risk of 'no deal' will be a problem for Stokeon-Trent's manufacturers. He said: "I think we've actually been constrained by Europe in the past. There are other markets, such as the United States the Far East and South America. "We want a trade deal with the EU, the Prime Minister has spoken about a Canada-style deal. It's up to the EU to accept that. Labour leader Keir Starmer called for more government support for the ceramic industry on a visit to Stoke-on-Trent last month.

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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

News

SITI B&T provides turnkey plant for Best Surface Spain

ITI B&T Group, supplier of complete systems for ceramics, consolidates its technological partnership with Best Surface, known for its Idylium brand, a manufacturing company that is innovating the world of design and architecture with its mineral stone for tops and interior and exterior surfaces. SITI B&T has made all its exclusive technological solutions available to Best Surface, starting with SUPERA® technology, creating a “turnkey” plant for large sizes of mineral stone in Castellón, Spain. Elegance and refinement, with unparalleled aesthetic effects, are the salient features of a product that best interprets Italian style, entirely conceived in Milan, the world capital of fashion and design. It is one of the most prestigious and recent achievements of SITI B&T, a complete plant to produce large slabs for interior design. The line brings together numerous technologies that satisfy a concept of Total Environmental Respect (T.E.R.), production processes with minimal environmental impact. Best Surface uses the technological solutions of SITI B&T Group (which include Projecta Engineering’s digital decoration and Ancora’s finishing) for each phase in the production process. A technological and aesthetic knowhow that the Italian group is able to offer, starting with the creative and planning contribution of Digital Design, a company dedicated to the creation of graphic projects. The Idylium production plant in Castellón is spread over a total area

of 40,000 square metres. The plant produces four different sizes of slabs: 1600x3200, 1200x2600, 1200x2400, 1000x3000 with thicknesses ranging from 6 to 30 mm. SITI B&T has provided the technological solutions for each phase of the process, from powder mixing and feeding systems, to technologies for creating full-body aesthetic effects (through veins), SUPERA® pressing (from 36,000 tons), equipped with the Start & Stop® energy saving system, the power on demand hydraulic generator that reduces energy consumption by up to 30%, as well as the Ancora technology for green cutting of the slabs. The multi-level horizontal dryer feeds Projecta Engineering's Full Digital decoration line, with the INNOVA printing machines, both for the application of glazes and for the printing of graphics, expandable up to 16 colours, as well as the INNOVAFIX dry printing machine for the application of grits and material effects. The Titanium® double-channel kiln for slabs, best in class for energy efficiency and lower emissions, guarantees a reduction in consumption of up to 30% and a productivity that is 25% higher than alternative solutions.

The line is SITI B&T fitted out with a latest generation sorting and palletizing system, equipped with a Gripstrong storage system. There are also artificial vision machines for the control of planarity and size. Internal handling of the slabs is then managed by a completely configurable LGV supervision technology with Totally Safe Mobility (TSM) operator safety sensors, which manages the flows of materials output from the kiln to the sorting line and from the temporary storage of the product to the finishing phase. The slabs are stored on stackable layers up to 6 levels by 4 Big Mover laser guided vehicles. The plant fully fits in with the topics related to the smart factory, in a perspective of totally interconnected systems. It is in fact equipped with the bt-TUTOR plant supervisor, which monitors, collects data and controls the plant, interacting with production planning, preventive and predictive maintenance, as well as being cloud compatible, supporting mobile devices and having a user friendly operator interface. Still in Spain, on the finishing front Ancora technologies have been chosen by Polialc, a company based in the Castellón district specialized in squaring,

lapping and cutting, for all the slab finishing phases. The system was created for sizes from a minimum of 1000x1000 mm up to 1800x3600 mm, with thicknesses from 5 mm up to 30 mm, with the functions of surface lapping and polishing of full body products. Lastly, the infinite possibilities of full-body decoration and 3D surface structures that Supera® allows, need highlighting. Continuous research has allowed us to obtain innovation patents even in full-thickness decorations, aimed at creating original surfaces with a strong identity. The material is reinvented with threedimensional and “through” effects throughout the mass. A technology capable of creating beauty. There are numerous effects that can be produced thanks to VENA3D® technologies (fullbody veining combined with digital decoration), CEMENTO 3D® (micronized powders and double loading), TUTTO3D® (full-body decoration). SUPERA® is able to create high reliefs with extraordinary depth, up to 4 mm deep on very thick slabs, and with unparalleled definition. SITI B&T is a group that fully covers the value chain, with proprietary technology. Each phase of the production process finds a specialist within the group: SITI (complete lines for ceramics), Projecta Engineering (full digital decoration), Digital Design (creativity and design), Ancora (complete finishing systems), Diatex (diamond tools)..

Betta prospects for sanitaryware South Africa

s of October, SACMI’s 8th ALS casting machine has been tested and started up with success at Betta Sanitaryware. The leading South-African sanitaryware manufacturer, the company has invested for many years now in SACMI’s pressure technology for the unbeatable

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advantages it offers and, thanks to the new supply, the total production capacity at the Johannesburg factory now exceeds 2 million pieces/year. SACMI’s ALS machine is the specially designed solution for the production of washbasins and water tanks of various types, with maximum flexibility and

reduced cycle times thanks to process repeatability. At the same time, the distinctive feature of this machinery it its renowned reliability over time, so much so that the first ALS Machine – supplied by SACMI to Betta over 20 years ago to the South-African – is still in operation today to the full satisfaction of the customer.

With this latest supply, SACMI once more demonstrates the superior characteristics of pressure casting technology for top quality production. It also cements our strategic partnership with one of the most important sanitaryware manufacturers in the world; a leading brand of the Ceramic Industries Group.

www.asianceramics.com

News

BASF divests construction chemicals business Germany

n September 30, 2020, effective at midnight, BASF closed the divestiture of its Construction Chemicals business to an affiliate of Lone Star, a global private equity firm. The purchase price on a cash and debt-free basis is €3.17 billion. The Construction Chemicals business now forms the newly founded MBCC Group, headquartered in

Mannheim, Germany. “Lone Star has been a professional partner in this transaction and is committed to the future success of the business,” said Saori Dubourg, member of the Board of Executive Directors of BASF SE. “We highly appreciate the tremendous efforts to realize the carve-out and close the deal in such a fast and decisive manner. We wish

the Construction Chemicals team much success for the future.” The divestment of the assets and liabilities of the Construction Chemicals business and the related disposal gain will be reflected in BASF’s financial reporting in the fourth quarter of 2020. Payments received in the context of the transaction until September 30 will be included in cash flows from investing activities in the Q3 2020

Statement of Cash Flows. On December 21, 2019, BASF and an affiliate of Lone Star had signed a purchase agreement for the acquisition of BASF’s Construction Chemicals business. With around 7,500 employees, the Construction Chemicals business operates production sites and sales offices in more than 60 countries and generated sales of about €2.6 billion in 2019.

announced it had agreed the sale and leaseback of its head office and central warehouse buildings in Leicester for £18.1m. The company said the proceeds from the sale of the buildings in Grove Park, Enderby, to UK Warehouse Properties Ltd will help its financial

position as it responds to the Covid-19 crisis. At the start of July Topps Tiles revealed that its retail trading "improved significantly" over its third quarter as stores were re-opened but still finished more than 50 per cent down compared to 2019.

Galleon sails into Topps United Kingdom

n Austrian investment management firm has taken a further bite out of Leicesterheadquartered Topps Tiles. MS Galleon AG, which is headquartered in Vienna, has increased its stake in the listed retailer from 11.07 per cent to

14.67 per cent. It comes after the firm had upped its holdings from 6.79 per cent in June. The company first invested in Topps Tiles in May and then bought more shares the following week. At the start of June, Topps Tiles

SPECIAL REPORT

SACMI PH Veloce, hi-speed pressing technology The new PH5200 Veloce, the first of a new generation of even more powerful, higher-performing presses, sees SACMI renew its global leadership in traditional - yet future-focused - pressing technology More productive, more powerful, more connected. The PH5200 Veloce is the first of a new generation of machines with which SACMI offers the best productivity and speed on the market, reasserting its leadership in the world of traditional pressing technology. Equipped with new, power-boosting hydraulic circuit solutions, this machine lets manufacturers achieve maximum productivity according to the specific product/ size being made. The result? The PH5200 Veloce can run at up to 14 cycles per minute with standard 60x60 sizes: a productivity increase of 25% or more compared to the previous solution. "Thanks to daily interaction with our customers, in-depth knowledge of every stage of the production process and a global approach to the press-filling devices system", points out Gianluca Pederzini, Forming PU Director at SACMI Imola, "we're able to tweak every single technological phase to perfection". The ability to optimise these different stages lets operators manage the process with maximum flexibility, ensuring consistently optimal performance to achieve the desired outcomes. "We’ve focused on the key characteristics of the press to make it more productive, efficient and reliable, thus ensuring maximum product quality at all times" adds Pederzini. www.asianceramics.com

In general, the entire pressing process has been improved to meet the demand for greater productivity. This considerable increase in productivity also means greater sustainability, with the machine's specific energy consumption now one of the lowest in its class. Over the coming months the PH5200 Veloce - the first in a new SACMI series to be launched on the market will be joined by the PH3000. Other models of different tonnages will follow to complete the new range, a valuable addition to the consolidated Imola and 2000 series. At the same time, these new machines will feature further 'smart' packages to meet manufacturers' every production/service requirement. Once again, SACMI leads the way on the traditional pressing front, pushing ahead with innovation just two years after the launch of a complete series of integrated-automation machines that brought forward the 4.0 revolution in ceramic factories. What's more, this smooth evolution confirms the competitive advantage that only SACMI - a worldwide supplier not just of presses but also moulds and complete filling devices - can provide. This global approach to machine and market has, so far, seen SACMI sell over 13,000 ceramic presses in no less than 93 countries worldwide. AC 20-5

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Raw Material News Special Report: Clays

Imerys’ new ball clays to increase sanitaryware body performance Both the development of the technology in conventional casting in Egypt and the sanitaryware trend going for bigger and more complex pieces are leading the constant demand for higher performance raw materials with low energy consumption and increased production yield. With these requirements in mind, Imerys has developed two new products, Vigor CA50 and Vigor CA70. The ball clays are produced in the Imerys site of Ramadan City, 25km from Cairo and are added to its one stop shop of raw materials for the sanitaryware industry.

screening for the first phase. Thanks to its specific selective mining and refining processes, Imerys is able to produce a full range of semi-refined and fully-refined clays. Properties highlighted in table 1 shows that the semi-refined clays, Vigor CA70 have a high alumina level, high fluidity and medium mechanical dry strength whereas the fully refined clays, Vigor CA50 is characterized by a medium alumina level, high fluidity and high mechanical dry strength.

Semi-refined and fullyrefined clays The ball clays from the Imerys site, close to Cairo - Egypt are low carbon clays, mainly composed of kaolinite, illite and quartz. They are characterised by high dry strength, combined with a good particle size distribution, where 50% of particles are finer than 1 micron, measured by sedigraph. These characteristics endow the ball clays with good properties for the production of sanitaryware, such as good plasticity and fluidity, low blunging energy, high dry mechanical resistance and controlled shrinkage with no need of

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Table 1. Properties of Imerys ball clays for the sanitaryware industry

Graph 1. Typical body recipe used in testing the different ball clays

Taking a look at Vigor CA50 properties in table 1, it presents a low thixotropy at 7P and a 1 hour viscosity (V60) at 38P for high casting density of 1.728 Kg/m3. This performance will allow increasing the sanitaryware body density while keeping the same rheology. It will result in improving the particle packing, which translates into a higher green strength and improving the dimensional stability of the sanitaryware piece. Moreover the low residue at 125 microns is facilitating the ball clay slurry preparation by reducing its operating time, leading to a lower energy consumption. At last, Vigor CA50 gives a high dry mechanical strength, 93 Kg/ cm2 modulus of rupture which reduces the handling cracks and increases the plant yield. As a consequence of development, Vigor CA70 enriched Imerys portfolio with a higher alumina level and a finer PSD ball cay.

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News

Both ball clays, Vigor CA50 and Vigor CA70, are representing moderate carbon levels which give stable rheology, better performance in faster firing system, stable casting process and increased kiln productivity.

spindle 3 at 2 rpm. In the standard procedure, each measurement is then plotted against the corresponding V60 value and a linear relationship is determined. This relationship then allows the value of each measurement to be determined at a fixed thixotropy value - usually V60 = 60 Poise.

Imerys body testing method

In table 2, high dry strength has been obtained when using All bodies were tested Vigor CA50 with standard according to the Imerys casting rate, while a higher standard body testing casting density with a higher procedure with a standard casting rate can be achieved vitreous china body when using Vigor CA70. recipe. The procedure adjusts the density of the Both Imerys new ball clays slip so that a viscosity of allow the sanitaryware bodies 5P - Brookfield, spindle to reach a high cracking 3,20 rpm - is achieved tolerance number which at full deflocculation. Full means that they present a deflocculation is the point at good packing behaviour for which a minimum viscosity the full body and less drying is reached as deflocculant cracks. is added. Table 2. Imerys Vigor CA50 and Vigor CA70 results in sanitaryware body Imerys new ball clays Vigor CA50 and Vigor CA70, Because this method have been designed to controls the viscosity of be complementary in the the slip, rather than fixing sanitaryware formulation the slip density, Imerys offering more choices to calls this method the fixed manufacturers. Hence, viscosity, remembering that whether casting by only the viscosity of the fully conventional techniques, or deflocculated point is fixed. high pressure casting, the Once the slip density sanitaryware manufacturers reaches a viscosity at full have more tools available to deflocculation of 5P, four specifically fine tune body sub samples of slip are recipes and achieve optimum produced with different performance and maximise deflocculant additions. Imerys processing site in Egypt yields. Imerys technical teams It will enable to obtain Crushing process at Imerys site in Egypt are continuously looking at four slips with different ways to develop solutions to thixotropies and measure better meet manufacturers’ the body properties at V60 needs. In order to boost the = 60 Poise. properties of its minerals and foster innovation, Imerys Each slip is then tested has set up major ceramic for a variety of casting and technology centres in Europe, rheological properties, Asia, & Middle East. Blending such as casting rate, platforms and R&D facilities viscosity and V60. Imerys located near ceramic clusters measure of slip thixotropy enable their technicians to is called V60, as it involves provide technical assistance and develop made-to-measure measuring the long-term slip structure build-up for 60 minutes formulations to sustain its customers’ development. - a typical casting time - using a Brookfield viscometer with

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Raw Material News Special Report: Clays

Sibelco introduces innovative new clay blend to boost whiteness in large format tiles. The increasing popularity of large format porcelain tiles as an alternative to natural stone and marble has created a need for whiter tile bodies. Sibelco, one of the world’s largest providers of industrial minerals, will later this year launch an innovative new solution to help tile manufacturers in India achieve this. SIBRIGHT is a blend of high performing clays. Scheduled for launch in December 2020, the product will be manufactured at Sibelco’s brand new blending facility (pictured) situated close to the port of Kandla, just 125 kilometres from India’s largest ceramic cluster in Morbi, Gujarat. Investment in the new facility will enable Sibelco to better serve its nearby customers with premium quality local products, reducing the need for imported clays.

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Higher whiteness and faster firing A key feature of SIBRIGHT is its low levels of titanium dioxide and iron oxide, as shown in the comparisons in Figure 1 below. This combination of properties will enable manufacturers to achieve higher levels of whiteness in porcelain and ceramic tile bodies. At the same time, low levels of potassium oxide and low loss on ignition support faster firing, creating new opportunities to save on energy costs and reduce carbon emissions. When compared with local and imported clays, SIBRIGHT has a similar L-value (representing the amount of white) but a lower B-value (the amount of blue), even after mixing with 60% feldspar. These properties will again help manufacturers to

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News

A sense of perfection

Sibelco’s new ceramic blending facility near to the port of Kandla

SIBRIGHT is a blend of clays and special additives

achieve whiter tile bodies. In addition, SIBRIGHT has significantly lower water absorption than local clays, enabling easier vitrification. This remains the case when mixed with 60% feldspar.

Replacing the need for expensive mineral additives It is common for Morbi’s manufactures to mix bentonite or imported clays with local clays to provide additional strength and plasticity in large format tiles. This involves additional costs and also limitations in terms of the percentage of bentonite that can be added without causing production issues. The strength and plasticity provided by SIBRIGHT eliminates the need for bentonite, the omission of which also lowers slip viscosity. This should make it possible to increase slip density to 1720 in line with Italy’s leading tile manufacturers. SIBRIGHT can also reduce the need for zirconium silicate as a whitening agent, providing a higher L-value than a body formulation using 2% zirconium silicate whilst retaining a good B-value. This can be seen in Figure 2 which compares a body formulation using 10% SIBRIGHT with two standard body Upon launch in December, SIBRIGHT will enable manufacturers to increase whiteness whilst at the same time reducing body formulation costs through the replacement of more expensive materials, and to reduce energy costs through faster firing. With over 114 production sites across 31 countries, Sibelco is one of the world’s leading providers sproof industrial minerals and other material solutions. The company offers a comprehensive portfolio of materials for ceramics including clay, kaolin, cristobalite, dolomite, feldspar, nepheline and silica. Sibelco’s investment in its new clay blending facility near Kandla will enable local tile manufacturers to reduce dependence on expensive imported materials and instead achieve the same or better results with high quality local materials. For new product information you can contact: padmakumar@ sibelcoasia.com or Amit.Parihar@sibelcoasia.com

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A sense of perfection High surface quality. Economical systems. Glazing systems by LIPPERT maximise your product’s marketability by creating perfect surfaces. For porcelain and ceramics of any and all shapes and sizes. For automatic and semi-automatic processes. In addition to top quality as your main selling point, LIPPERT also supplies you with flexible systems for more economic production. Exploit your rationalisation potentials while producing perfect glazes. Think about it - it‘s worth it.

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

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News Anaylsis

News

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Procurement plan to fire Lankan firms? Analysts at Asia Securities have said that the Government’s new circular on procurement as exclusively published by in Sri Lanka in late October, will extend strong protection for local firms, encourage capacity expansions and entry of new players. The Ministry of Finance recently issued a circular amending the procurement guidelines to further support local industries. It is said the guidelines in the circular were in favour of local construction and construction-related-material manufacturers. “With the sudden influx in demand driving local manufacturers of construction-related materials to operate at maximum capacity, a key theme we see playing out in the near to medium-term is 1) capacity expansions and 2) welcoming of new players to help cater to the increase in demand, thereby creating more local value addition,” Asia Securities said in an Equity Outlook on the Construction Sector of the Colombo Stock Exchange.     According to the circular, any contract over Rs. 150 million up to Rs. 600 million should exclusively be awarded to local construction companies with CIDA grading of C3 and C2. Further, any contract over Rs. 600 million should be awarded exclusively to local contractors with gradings above C1.      “We see Access Engineering Plc (AEL) directly benefitting from this given that majority of its specialisations are above C3 grade category. The guidelines are likely to keep foreign contractors away from Government-funded projects and put local construction companies at the forefront,” Asia Securities said.     Citing other facets of the circular, Asia said other listed companies such as Tokyo Cement, Royal Ceramics, Lanka Tiles, ACL Cables, Kelani Cables, Alumex and Parquet Ceylon stood to benefit.     For local construction contracts when goods and materials are required under the BOQ, these should be sourced exclusively from domestically manufactured/ produced goods/materials.   They are 1. Cement, 2. Reinforcing steel and certain sections of steel angles, 3. Clay bricks, cement

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blocks and concrete products, 4. Roofing material (clay tiles, cement titles, asbestos, zinc alum, GI), 5. Ceramic and granite tiles, 6. Parquet and wooden flooring, 7. Pantry cupboards and wooden furniture, 8. PVC and UPVC pipes, gutters, down pipes and fittings, 9. Electrical cables LT, 10. Transformers with accessories, 11. Electrical switches and sockets, ceiling fans, 12. Aluminium extrusions, doors and windows, 13. Sliding/roller shutter doors and gates, 14. Plywood doors, wooden doors, fibre glass doors and steel doors including fire rated, 15. Brass iron monger, 16. Paints, 17. Water pumps, foot valves and 18. Electrical panel boards. Asia said cement capacity expansion was highly likely in the next 12-24 months for Tokyo Cement and unlisted INSEE and new players would be welcomed to cater to higher demand. “We see cement manufacturers TKYO and INSEE benefiting immensely from the new amendments to support domestic industries. With the local manufacturers offering more than 25% local value addition, we see these players being the top preference for local construction contracts who have been asked to exclusively seek domestic suppliers,” Asia said.  On the other hand, the entry of Melsta Gama and Lanwa Steel will now be more welcomed to take on the addition demand that the local manufacturers will not have the capacity to take on. Asia sees the lower margin categories being supplied to by the new players, in order to make up for what will be a sharp increase in demand. TKYO and INSEE on the other hand will be moving on to take on the higher margin construction projects. “We see local cement manufacturers bursting at the seams to cater to the increase in demand. To this regard, we see a capacity expansion for both TKYO and INSEE being fully justified in the next 12-24 period. With our expectation of strong results over the upcoming quarters and debts being paid down, we see more room for debt to accommodate a capacity expansion of up to one million MT p.a., which our channel

checks indicate will come at a cost of $ 35-50 m,” Asia said. “As such, we see a very low likelihood of a rights issue to raise funds for expansion,” it added.  The investment bank also said the new circular offered a much-needed move for the underutilised aluminium extrusion sector.    In terms of tiles, it said capacity expansion and new players would be needed to cater to domestic demand. “Already operating at maximum capacity with the import bans in play, we see local tile manufacturers RCL and TILE carrying the momentum in the near to medium-term. It is our understanding that local tile manufactures are currently falling short of being able to provide for the current local demand,” Asia said. “As such, with the support given to domestic industries, we see tile manufacturers increasing capacity in the next 12-24 months provided the protection for domestic industries remain in place. Furthermore, our conversations with local tile manufacturers suggests an openness and encouragement to welcome other players into the tile industry to support more local value addition,” Asia added. Largest cable players ACL and KCAB are to benefit the most from the new circular. “With electrical cables, electrical switches and sockets, etc. also falling under the protected domestic firms, we see ACL and KCAB, along with its subsidiary companies such as APLA benefitting from their market leader position. We note that ACL and KCAB together account for 70.0% of the cable sector market share,” Asia Securities said. In addition to construction companies being given more preference, the circular further goes to note that preference should be given to domestic firms (registered with a relevant authority in Sri Lanka with more than 51% ownership held by Sri Lankan nationals) offering at least 25% local value addition in hardware in terms of manufacturing or assembling categories.

www.asianceramics.com

Analysis: Indonesia

Indonesia may the riches return…

fter years of struggles to revive its competitiveness in the domestic and world markets, the Indonesian ceramic industry is now poised to rebound as the government has taken a restrictive move against the imports and returned to support the energy intensive industry like ceramics by reducing price of natural gas to US$6 per mmBtu, with effect from April, this year. Gas is supplied by the state-owned gas utility, PT Perusahaan Gas Negara (PGN). A sigh of relief is however spreading through the Indonesian ceramic industry association, Asosiasi Aneka Industri Keramik Indonesia (ASAKI), to renew its efforts to boost up utilization of production capacity and attract new investment in the sector. “The safeguard and the restrictive import duty against the alien lower priced products will ensure the benefits of the reduced gas price,” said Edy Suyanto, Chairman of ASAKI. “By September, almost all of the ceramic factories were equipped and connected with the distribution lines under the new price,” said Edy. The high gas price component was around 35-40 percent of the total cost of ceramic production, making the ceramic industry in Indonesia unable to compete with cheap imported products from China, India, Vietnam and others. The government raised the gas price to US$7.98-US$10 per mmBtu, according to location, to earn more revenue turning the ceramic industries as user of one of the most expensive state-owned energy in the region. In its move to protect home industry from dumping, Indonesia has reimposed a duty on ceramic tiles shipped from India and Vietnam with effect from September this year, said Febrio Nathan Kacaribu, head of the fiscal policy office under the Ministry of Finance. The tile importers would be liable to pay a 23 percent safeguard measures import duty, known as BMTP, for the next 12 months,

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while the duty would drop to 21 percent and 19 percent in the second and third years, respectively, Febrio stated officially. Under WTO agreement on international trade provision, a country can impose safeguard import duty when the imported products' market share exceeds three percent of the market in the country. “In Indonesian market, India and Vietnam far exceeded that threshold,” said Febrio. According to the evaluation of the Trade Ministry in December 2019, imports of ceramic tiles from India and Vietnam in the 20182019 period jumped by 22.72 percent and 6.58 percent, respectively, said Febrio. He said the government intended to protect domestic ceramic tile makers and see them meeting most of the local demands. Indonesia removed ceramic tiles from India and Vietnam from the BMTP list several years ago, since than imports from the two countries have grown to pose a

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Analysis: Indonesia

in focus threat to local ceramic tile manufacturers. ASAKI said the import figures from China did not drop as expected after similar safeguard imposed in October 2018, which was also valid for 3 years and is now scheduled to decrease to 19 percent in October, 2020, to affect further competitiveness of the local products. But imports from India and Vietnam have increased tremendously. The production cost in India is much lower because of lower energy prices, cheaper wages and local raw materials, including minerals and chemicals. “Even in current COVID-19 pandemic period, Indonesian imports of ceramic tiles from India have increased by 57 percent,” said Edy. ASAKI fought fiercely against the government’s price increase, and demand a reduced rate of US$6 per mmBtu of gas/LNG with the aim of reviving the competitiveness of the ceramics industry which plummeted due to 50 percent increase in gas prices in 2013.

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

PT Hankook Ceramic Indonesia

Location: Pasar Kemis, Tangerang, Indonesia Products: Porcelain and fine bone china hotelwares and household tablewares Markets: Domestic and export markets Others: PT Hankook Ceramic Indonesia is a leading quality manufacturer of tablewares with a production capacity of one million pieces per month. It produces bone china, vitrified fine china, porcelain and stoneware dinnerwares and gift items. PT Haeng Nam Sejahtera Indonesia  Location: Bogor, Indonesia  Products: Porcelain, fine bone china and stoneware tablewares Markets: Domestic and export markets Others: Brand - Haengnam   PT Lucky Indah Keramik Indonesia Location: Jakarta, Indonesia Products: Ceramic stoneware dinnerwares Markets: Domestic and export markets Others: Lucky Indah Keramik produces ceramic stone dinnerwares. Deep plates, bowls, flat plates, cups and saucers with different sizes. Also handpainted items, white wares, decorated items, soup plate with embossed designs on brown body, etc.

PT Indo Porcelain

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

www.asianceramics.com

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asian ceramics

Analysis: Indonesia

The government was also under mounting pressure from ASAKI to impose import restriction and put into effect a heavier safeguard measure against China, India and Vietnam. After outbreak of COVID-19, the government has imposed a restrictive import duty on ceramic products from March. By this time the government has gradually allowed reopening of factories and retail sales outlets under certain COVID-19 pandemic related social distancing and health regulations to increase production, domestic sales and exports. According to ASAKI, entering the era of New Habit Adaptation, the national ceramic industry in Indonesia is slowly starting to increase its production utilization again from the previous drop to 30 percent in April due to the impact of the COVID-19. “Until the end of July, utilization began to increase to a level of 56,” said Edy. "ASAKI projects that the capacity utilization will return to 65 percent, its pre-pandemic normal level by the first quarter of 2021," he added. Industry sources believe the reduced gas prices will help the ceramics industry grow again and the production plant utilization rate would increase back to some 90 percent, as it was before the gas price increase. ASAKI is hopeful to increase the exports of ceramic products to its potential markets, in Australia, Malaysia, Philippines, South Korea, Taiwan, Thailand and USA. Despite current or pre-pandemic lower utilization of capacity, some 10-15 percent of the produced ceramics, mainly tiles and tablewares have export demands, said ASAKI.

High capability

Indonesia has a large market with over 274 million population, the availability of raw materials, the large number of available skillful manpower and in general, the industry also follows the trend of using the latest production technology. The manufacturing plants in Indonesia are highly capable of producing ‘big slab ceramics,’ said Edy, who is also the Chief Operating Officer (COO) of PT Arwana Citramulia Tbk, one of the two largest tile manufacturers in Indonesia. According to the industry sources, Indonesian ceramic industry’s installed capacity utilization increased to an estimated 76 percent in 2019 from about 68 percent of 2018. The safeguard measure import duty or safeguard imposed by the government since October 12, 2018 helped to some extent protect the domestic ceramic industry from the impacts of rising imports. Although, the rise in imports from China was contained, India and Vietnam have largely increased their ceramic exports to Indonesia. In 2020, Indonesia is expecting to sustain its growth amidst slowing down of the global economy as the government continues to pursue expansion on infrastructure projects and other economic activities. It has tried to resolve the COVID-19 pandemic problem by providing relaxations and stimulus so that the economy remains less affected. However, ASAKI believes that the country’s ceramic industry’s growth still depends substantially on successful implementation of the safeguard measures, as the current year’s restrictive ceramic import policy adopted after outbreak of COVID-19 could not reduce imports significantly. Amid pandemic, the government has revised Indonesia’s GDP growth target for the current year, 2020, to 4.2-4.6 percent, a significantly high target compared to the growth rate in 2019, when the country’s GDP grew by some 5.02 percent, lower than 5.17 percent of the previous year. The prospect of global and

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ASAKI IS HOPEFUL TO INCREASE THE EXPORTS OF CERAMIC PRODUCTS TO ITS POTENTIAL MARKETS PT Doulton Indonesia (Wedgwood Royal Doulton) Location: Tangerang, Banten, near Jakarta, Indonesia Products: Porcelain and bone china hotelwares and household tablewares under the Royal Doulton and Wedgwood brands. Markets: Domestic and world markets Others: Nearly whole of the outputs are exported worldwide. PT Narumi Indonesia Location: EJIP Industrial Park, Cikarang Selatan, Bekasi 17550, Indonesia Products: Bone china hotelwares and household tablewares Markets: Domestic and export markets Others: The hotelwares produced in the Indonesian plant of the Japanese Narumi are supplied to the hoteliers worldwide.

PT Kedaung Oriental Porcelain Industry (KOPIN)

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

PT Semesta Keramika Raya

Location: North Jakarta, Indonesia  Products: Ceramic tablewares   Markets: Domestic and export markets Others: Brands - SKR, EATON

PT Lucky Kurnia Impact

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

www.asianceramics.com

Analysis: Indonesia

domestic economy in 2020 depends on the process of handling and economic recovery after the COVID-19. ASAKI hopes that the ceramic industry’s growth for the current year will be accelerated if the increased capacity utilization is ensured by the safeguards and increased exports with reduced gas price.

Increasing productivity

Meanwhile, due to their capability to stay in the market with efficiency in production driven by the application of modern technology and some restrictive measures imposed against imports in the past years and despite lower utilisation of capacity, some manufacturers with lower middle segment products are expanding. They include Mulia Ceramics, Arwana Citramulia, PT Gemilang Mitra Sejahtera, Kaisar Ceramics (PT Cahaya Putra Asa Keramik) and Garuda Tiles (PT Jui Shin Indonesia). There are several tile producers in the country who are able to maintain their export market shares. Roman Ceramic (Lyman Group/Roman Brand), which has launched its new large size product ‘Quadra’ with three main-range large types of tiles, Slab, Countertop and Slimline, with an export orientation and is well received. However, the export destinations are still mainly the countries around the region, such as, ASEAN, South Korea, Taiwan, and Australia. The faster growing ceramic tile manufacturer Arwana Citramulia focused its products on the lower middle segments. It operates 5 factories in different consumer locations to reduce the cost of expensive logistics in Indonesia. The service and distribution can be faster and on time as well. In addition, the high level of product availability in the market enables Arwana still maintain sales growth. Arwana has just completed capacity expansion in South Sumatra in July 2019 and the company’s installed capacity is currently 62 million sq metres per year. Arwana said it focuses, specially, on the ‘Lean Manufacturer’ concept and always upgrades production machineries with the latest technology with the aim of providing customer satisfaction. However, increasing dependence on imported raw materials poses as a new threat to the Indonesian manufacturers. Ceramic raw materials imports have increased largely, rising up to 90 percent of certain requirements of the manufacturers, according to industry sources. The continuously rising cost of labour and the erosion in value of the Indonesian currency (Rupiah) every year have been increasing the cost of production. The cost of imported raw materials is rising due to currency readjustment. The proceeds of the exported ceramic products remain stagnant in recent years following fall in prices and demands in the export markets. On average about one third of the installed production capacity remains unutilized most of the time in the Indonesian ceramic factories. “The uneconomic production is being easily beaten by the alien products,” said the ASAKI chief Edy. In addition, another challenge is that the property sector in the country remains stagnant, said Edy. All the increases of expenses have pushed up production cost substantially making exports expensive. The country’s largest tile manufacturer, PT Muliakeramik Indahraya (MKIR), known as Mulia Ceramics, is concentrating more on the domestic market, while in the past it developed capacity thriving on the global export markets. Because of higher production cost, the domestic market was largely grabbed by the cheaper imports.

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

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

PT Sari Keramindo

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

PT Jatakekeramindo Kharisma

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

PT Mujur Kurnia Ampuh

Location: Kelapa gading,Jakarta Utara 14240, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets PT Sri Intan Toki Industri Location: Kab. Bogor, Jawa Barat, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets

PT Rosy Ceramindo

Location: Pasar Kemis, Tangerang, Banten, Indonesia Products: Ceramic tablewares Markets: Domestic and export markets

PT Surya TOTO Indonesia Location: Tangerang, Indonesia Products: Ceramic sanitarywares Markets: Domestic and export markets Others: PT. Surya TOTO Indonesia is TOTO’s first overseas factory. Its products include water closets, urinals, bathtubs, washbasins, bidets, sanitarywares with bathroom cabinets and fixtures, etc. The products are exported worldwide. PT American Standard Indonesia

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

PT INAX International (INA Sanitaryware)

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

www.asianceramics.com

Analysis: Indonesia

PT Kohler Indonesia

Reduced imports

Indonesia is one of the world’s major manufacturers, consumers, exporters and importers of ceramics. The dominant player is tile. According to the 2019 estimates of ASAKI, the production capacity, real production and consumption of tiles were 537 million, 352 million and 427 million sq metres, respectively. Main exports are tablewares and tiles. The country is awaiting a higher GDP expansion-led growth in domestic consumption following slower exports. In terms of value, according to Geneva based International Trade Centre (ITC), Indonesian ceramic product imports in 2019 from the global sources declined to US$524.814 million, from US$638.066 million of 2018. The country’s ceramic imports from China alone declined to US$342.911 million from US$464.293 million of the previous year. During the year Indonesia’s exports of ceramic products to the world also declined to US$295.338 million from US$343.233 million of 2018. Tiles always lead the imports. In 2019, tile imports declined to US$272.556 million from a record US$325.880 million in 2018, while the imports are shipped mainly from China. However, tile imports from China has declined to worth US$187.444 million last year from the record US$301.908 million of 2018, according to ITC.

Influence on tiles

ASAKI said the Indonesian domestic tile market and the world imports of tiles from Indonesia is greatly influenced by the global trade environment and this has impacted the tile production in Indonesia in the past three years. The global impact of COVID-19 coronavirus pandemic has added a much bigger war-like situation to the country causing breakdown of the economic vehicle since the first quarter of 2020 and almost continuing the situation for the remaining period of the year with a little improvement in the third quarter. According to ASAKI, the Indonesian economy had been very volatile over the course of 2018, and continue to remain weak in 2019, in line with the rising political tensions ahead of the presidential elections and the on-going trade war between its two biggest trading partners, China and US. The “One-year One million Houses” program launched by government since 2015, has reached 90 percent of the target within the 5-year period. This project is equivalent to 36 million square meter need of low to medium segment tiles yearly, which is about 12 percent of our national production of tiles. Medium to high end housing projects have put on hold in since the second quarter of 2019, fearing of the uncertain political condition. In addition to that, market becomes pessimistic. The country’s economy has been driven by its agricultural sector and prolong dry season together with decline in demand of palm oil that effect the purchasing power of the customers. The Indonesian government is currently focusing on building infrastructure in attempt to improve logistic efficiency and boost tourism, said ASAKI. “The growth trend of the ceramic industry in 2019 improved especially for the lower middle segment which helped the country’s utilization of production capacity to rise to 65 percent, supported by the government program namely, the Village Fund, the Million Houses Project for low-income people and simple flats,” ASAKI Chairman Edy told Asian Ceramics. To maintain the growth trend and the increase of capacity

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

PT Roca Indonesia

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

PT Surya Pertiwi Nusantara

Location: Surabaya, Jawa Timur, Indonesia Products: Ceramic sanitarywares Markets: Domestic and Export Markets

PT Trilliunware Prima Sukses

Location: Surabaya 60182, Jawa Timur, Indonesia Products: Ceramic sanitarywares Markets: Domestic and Export Markets

PT Muliakeramik Indahraya

Location: District. Cibitung, Cikarang, Bekasi 17520, Indonesia Products: Ceramic and porcelain floor and wall tiles Market: Domestic and export markets PT Arwana Citramulia Tbk  Location: Puri Sentra Niaga, Bl T2, Jakarta 11610, Indonesia Products: Ceramic and porcelain floor and wall tiles Market: Domestic and export markets

Lyman Group/Roman Brand

Factory-1: Pt Satyaraya Keramindoindah  Factory-2: Pt Metropole Megah Location: Jl. Raya Serang Km. 25, Balaraja, Tangerang 15610, Indonesia Products: Porcelain, vitrified and normal ceramic floor and wall tiles. Markets: Domestic and export markets

Intikeramik Group/Essenza Brand

Factory no. 1: PT Intikeramik Alamasri Industri Tbk.  Location: Desa Ganda Sari, Kecamatan Jati Uwung, Tanggerang, Indonesia  Factory no. 2: PT Internusa Keramik Alamasri Industri Tbk Location: Desa Ganda Sari, Kecamatan Jati Uwung, Tanggerang, Indonesia  Products: Porcelain floor and wall tiles of Essenza and other brands Markets: Domestic and export markets Exporters of tablewares Major ceramic tableware exporters of Indonesia Company Name

Location

PT Doulton

Tangerang, Indonesia

PT Kedaung Oriental Porcelain Industry

Jakarta, Indonesia

PT New Surabaya Ltd

Surabaya, Indonesia

PT Timur Kentjana

Jakarta, Indonesia

Exporters of sanitarywares Major ceramic sanitaryware exporters of Indonesia Company Name

Location

PT American Standard Indonesia

Bogor, Indonesia

PT Inax International

Semarang, Indonesia

PT Surya Toto Indonesia Tbk

Jakarta, Indonesia

www.asianceramics.com

Analysis: Indonesia

utilization the safeguard measures against the Indian and Vietnamese products were a good relief to some of the manufacturers, especially, in the large-import affected tiles sector. The sanitaryware and tableware sectors also face the same obstacle due to increasing imports from China. Various types of imported tiles entered the markets with much cheaper prices compared to their Indonesian counterparts. The homogenous tiles from China have largely driven out the local and good quality homogenous tiles from its domestic market forcing capacity utilization to reduce to some 50 percent. The low price has enabled them to penetrate the market aggressively in the past half a decade. The local products are losing market share, as unable to compete with their prices. “Our production cost is higher than the landed cost. The imported homogenous tiles price is so low that customers who buy regular tiles are switching to imported homogenous tiles,” said Edy.

Comfortable dining zone Tablewares, kitchenwares and gift products with a stable export earning of well over US$100 million every year are still a comfort zone in Indonesian ceramic sector, mainly due to its labour intensive production process, while despite increase of labour wages, the cost of production in tablewares and kitchenwares and their demand in the world market still remains lucrative and offers opportunities for expansion to the stagnant capacity and production in the organized factories. However, the unorganized tableware and giftware factories meet a substantial demand both for domestic and export markets. This is the only sector where imports have no significant competition. In the past, the Chinese attempts to grab a market shares of organized and unorganized tableware sectors were strongly suppressed with restrictive policy supports. Imports now remain within US$20 million a year in value. In 2018, import value of porcelain and other tablewares, kitchenwares and gift items jumped to about US$22 million, from less than US$10 million in 2017 and a little over US$4 million in 2015. China has supplied a half of Indonesian imports of ceramic tablewares and kitechenwares in 2018, according to ASAKI. “The Indonesian commerce department has imposed an antidumping duty of 30 percent on the imported tableware products

PT Saranagriya Lestari Keramik (Milan Tiles) Location: Desa Suka Danau, Cikarang Barat – Bekasi, Indonesia Products: Ceramic and porcelain floor and wall tiles Market: Domestic and export markets

PT Keramik Indonesia Asosiasi (KIA) Tbk

Location: Cileungsi (Bogor) and Gresik (Surabaya), Indonesia Products: Ceramic and porcelain floor and wall tiles Market: Domestic and export markets

PT Puri Kemenangan Jaya

Location: Rawasari, Jakarta Pusat, Indonesia Products: Ceramic and porcelain floor and wall tiles Market: Domestic and export markets

PT Platinum Ceramic Industry

Location: Jl Panglima Sudirman. Embong Kaliasin Surabaya, Indonesia Products: Ceramic and porcelain floor and wall tiles Market: Domestic and export markets

PT Jui Shin Indonesia Location: Slipi, Jakarta 11410, Indonesia Products: Ceramic and porcelain tiles Markets: Domestic and export markets

PT Mingchia Ceramics Indonesia (PT. Ayekeh Team Indonesia) Location: Pasir Gombong, Cikarang utara, Bekasi, Indonesia Products: Ceramic tiles Markets: Domestic and export markets PT Satyaraya Keramindoindah

Location: Balaraja, Tangerang 15610, Indonesia  Products: Ceramic tiles Markets: Domestic and export markets

PT Arwana Citra Mulia Tbk

Location: Sentra Niaga Puri, Blok T2, No. 24, Jakarta 11610, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Asri Pancawarna

Location: Dawuan Tengah Cikampek-Karawang 41373, Indonesia Products: Ceramic and porcelain tiles Markets: Domestic and export markets

PT Keramika Indonesia Asosiasi (Kia)

Location: 3 plants in Bogor and Karawang, West Java, and Gresik in East Java, Indonesia Products: Ceramic floor and wall tiles and ceramic roofing tiles Markets: Domestic and export markets

PT Keramik Diamond Industries Location: Jakarta, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Muliakeramik Indahraya

Location: Cikarang-Bekasi 17520, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

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Analysis: Indonesia

from China, and the domestic producers have regained the market share back,” said Edy. Before 2014, the exports of tablewares to Indonesia was very insignificant of a million US dollars only. Indonesia lost a substantial market, mainly to China during 2014 and 2018. Indonesia’s tableware exports also have plummeted from about US$137 million in 2014 to about US$95 million in 2018, according ITC. However, the tableware exporters are increasingly engaging the reputed designers in the market countries to compete with others including local products of the countries, which are importing alien items. Although, there is a trend of employing designers from the developed countries, many manufacturers are now using local designers in the ASEAN region. Reputed Indonesian manufacturer, PT Sango Ceramics, said its Sango brand’s designs are substantially homegrown both for the domestic and world markets. Reputed South Korean brand Hankook Ceramicware Co’s Indonesia operation, Hankook Ceramic Indonesia, said it has designers abroad for designing products for exports to the world market where cross-cultural designs are greatly adored. Quality designer items have tremendous impacts on the users of the dinnerwares for appealing beauties that influence substantially its artistic flavours parallel to the tastes of the foods and beverages served on the plates used. Hankook Ceramic Indonesia applies attractive simple designs for products exported worldwide. The vast disorganized army of many hundred small and medium enterprises (SME) engaged in production and export of tablewares in Java, Sumatra, Bali, Kalimantan and other islands have some sort of command in their domestic and export markets, but with disappointing profit for want of organised marketing supports. A major part of export earnings of tablewares come from the shipments of such SME potteries and small tableware manufacturers, who are also rivals in the domestic markets against the organized sector with large and higher-medium operators equipped with latest plants.

PT Cahaya Putra Asa Keramik Location: Kebayoran Lama-Jakarta Selatan, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Pegasus Keramik Terbaik

Location: Kav. 77, Jakarta Barat, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Saranagriya Lestari Keramik Location: Cibitung, Bekasi 17520, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Kobin Keramik Industry

Location: Mojokerto, Jawa Timur, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Perkasa Primarindo

Location: KH. Mas Mansyur, Kav. 126, Jakarta, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Primarindo Argatile

Location: KH. Mas Mansyur, Kav. 126, Jakarta, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Niro Ceramic Nasional Indonesia

Location: Kecamatan Gunung Putri, Kabupaten Bogor 16964, Indonesia Products: Glazed porcelain tiles Markets: Domestic and export markets PT Platinum Ceramic Industry Location: Embong Kaliasin Surabaya, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Angsa Daya

Location: Mangga Dua Raya Blok F2/3-5, Jakarta 10730, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Granitoguna Building Ceramics

SME vs organised

On the basis of Indonesian market trend, the tableware sector is estimated to grow by about 10 percent annually next decade, on assumption of hotel business that is expected to grow well by an approximate 8-10 percent a year.

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Location: Gambir, Jakarta, Indonesia Products: Ceramic homogenous tiles Markets: Domestic and export markets PT Chang Jui Fang Location: Jl. Raya Jembatan III, Jakarta 14450, Indonesia Products: Ceramic tiles Markets: Domestic and export markets PT Concord Industry Location: Desa Cimahi, Klari 41371, Karawang Timur, Indonesia Products: Ceramic floor tiles Markets: Domestic and export markets

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Analysis: Indonesia

The organized sector that has 12 large manufacturers of tablwares, including foreign investment units like PT Doulton Indonesia (UK), PT Narumi Indonesia (Japan), PT Hankook Ceramic Indonesia (South Korea), PT Haeng Nam Sejahtera Indonesia (South Korea), and Indonesia’s market leader PT Sango Ceramics Indonesia and also several manufacturers’ group PT Kedaung Oriental Porcelain Industry (KOPIN), is pushing ASAKI to put pressure on the government to reduce gas price to less than US$6 per mmBtu and other fiscal benefits to remain competitive in the domestic and world markets. To increase the competitiveness of pottery SMEs, in domestic and export markets, the Indonesian government through the Ministry of Trade and Ministry of Industry initiated the development of pottery handicraft clusters in three regions, DIY (Daerah Istimewa Yogyakarta/Yogyakarta Special Administrative Region), West Java, and West Nusa Tenggara. Within each pottery/ceramic cluster in respective region, the government helps cooperative activities among businesses, suppliers, service providers, and business support organizations related to pottery/ ceramics. There are eight major production centers for pottery in Indonesia. Kasongan and Pundong (located in DIY, DIY/ Yogyakarta Special Administrative Region), Melikan (near Klaten, Central Java), Klampok (in Banjarnegara, Central Java), Plered (in Purwakarta, West Java), Sitiwinangun (in Cirebon, West Java), Lombok (West Nusa Tenggara), and Singkawang (West Kalimantan). ASEAN bloc’s largest ceramic tableware manufacturer Indonesia’s total active tableware production capacity under organized and unorganized sectors is estimated to be over a billion pieces per year. Under organized sector, the annual production is about 300 million pieces per year, while the annual production capacity is much more than that. Many of the tableware makers are OEM suppliers to the global brand owners.

PT Ubin Keramik Kemenangan Jaya Location: Jl. Percetakan Negara no. C 261-263, Jakarta 10570, Indonesia Products: Ceramic tiles Markets: Domestic and export markets PT Gemilang Mitra Sejahtera

Location: The Icon - BSD City, Serpong 15311, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Dharma Perkasa Gemilang

Location: Lolawang Ngoro-Mojokerto, Jawa Timur 61385, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Sun Power Ceramics

Location: Desa Lolawang, Ngoro-Mojokerto, Jawa Timur, Indonesia Products: Ceramic tiles Markets: Domestic and export markets PT Surya Multi Cemerlang Location: Kel. Semambung, Kec. Wonoayu, Sidoarjo, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Internusa Keramik Alamasri

Location: Jl. Jend. Gatot Subroto Kav.71-73, Jakarta 12870, Indonesia Products: Granite and porcelain tiles Markets: Domestic and export markets

PT Yhc Keramika Indonesia

Location: Desa Klapanunggal, Kec. Klapanunggal, Kab. Bogor, Indonesia Products: Granite and porcelain tiles Markets: Domestic and export markets PT Lantai Emas Kemenangan Jaya Location: Jl. Percetakan Negara no. C 261-263 Jakarta 10570, Indonesia Products: Ceramic tiles Markets: Domestic and export markets

PT Sinar Karya Duta Abadi

Expanding sanitarywares

Increasing domestic consumption and demand from the export markets have boosted up production of sanitarywares in Indonesia. Despite higher production cost due to high gas prices, sanitaryware production grew substantially in the last couple of years. According to the industry sources, in production cost of vitreous china/porcelain snitarywares of average quality, the share of energy in cost of production is 40-45 percent, which is expected to come down largely following gas price reduction. The leading sanitaryware manufacturer, Toto Indonesia, reported achieving higher profit margin and expecting better future outlook in the domestic market that consumes three

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Location: Kembangan Selatan Jakarta Barat 11610, Indonesia Products: Granite and porcelain tiles Markets: Domestic and export markets PT Arwana Nuansa Keramik Location: Kembangan Selatan Jakarta Barat 11610, Indonesia  Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Arwana Anugerah Keramik

Location: Kembangan Selatan Jakarta Barat 11610, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Adya Buana Persada

Location: Kec. Wringinanom, Kabupaten Gresik, Jawa Timur 61176, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

www.asianceramics.com

Analysis: Indonesia PT Roman Ceramic International

quarters of its production. The market is on the track of growth, according to Hanaﬁ Atmadiredja, President Director of PT Surya Toto Indonesia Tbk. Toto’s new half a million pieces a year sanitaryware plant in Surabaya of East Java, Indonesia, has started commercial production two years ago. “This Surabaya plant will be our main producer, as its location provides better scope for the planned future expansion of Toto in Indonesia,” said Hanafi. The higher cost of energy, rawmaterials and labour have forced the Indonesian sanitaryware manufacturers to restructure their production efficiency to minimise operating cost in the factories. Indonesian exports of sanitarywares also recovered from the slower and unstable growth of the past several years and the shipment in 2018 and 2019 rose to over US$26 million, from US$22.845 million of 2017. With the increase of disposable income per capita, the middle-class consumers are rising fast in Indonesia. They need more aﬀordable products. “The Surabaya plant will meet the new demand,” said Hanafi. Toto has plants in three other locations in Indonesia. Globally major sanitaryware manufacturer Roca’s implementation program in Indonesia covered its brand development plan in the country. Through this program, Roca Group hopes to expand into the Indonesian market like that of the strategic success of Roca Malaysia. Roca hopes to build enough strength in Indonesia to be able to enter stable markets like Thailand and Australia, according to Kelvin Tjiandra, Managing Director of Roca Indonesia.   As one of Asia’s fastest emerging economies, Indonesia enjoyed a boom in construction this decade and is expecting better growth the next decade. This has been generating big demand for top quality sanitarywares in all building projects. This creates lots of opportunities for global brands to make a big splash in Indonesia. Every year import of sanitarywares are growing by about 15 percent. In 2019 Indonesia imported US$23 million worth of sanitarywares.

Location: Meruya Utara, Kembangan, Jakarta Barat 11620, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Indopenta Sakti Teguh

Location: Jl. Pangeran Jayakarta 121 no. 3-4 Jakarta Pusat, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Indoagung Multikreasi Ceramic Industri

Location: Jl. Pangeran Jayakarta 121 no. 3-4 Jakarta Pusat, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Kudalaut Mas Location: Jl. Industri, Desa Sidekepung, Kec. Buduran, Sidoarjo, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Kualimas Aditama Location: Jl. Raya Buduran, Sidoarjo 61251, Jawa Timur, Indonesia Products: Ceramic floor and wall tiles Markets: Domestic and export markets

PT Keramindo Mega Pertiwi

Location: Jl. Raya Serang Km. 25, Balaraja, Tangerang 15610, Indonesia Products: Ceramic roofing tiles Markets: Domestic and export markets

PT M Class Industry

Location: Curug Walahar, Klari, Karawang 41371, Indonesia  Products: Glazed and unglazed ceramic roofing tiles Markets: Domestic and export markets

PT Kia Keramik Mas (Kia Groups)

Location: 3 plants in Bogor and Karawang, West Java, and Gresik in East Java, Indonesia Products: Ceramic roofing tiles and ceramic floor and wall tiles Markets: Domestic and export markets

Major ceramic floor and wall tile exporters of Indonesia

PT Keramika Indonesia Assosiasi Tbk

Jakarta, Indonesia

Company Name

Location

PT Kia Keramik Mas

Jakarta, Indonesia

PT Adhi Wana Nusantara

Mojokerto, Indonesia

PT Kia Serpih Mas

Karawang, Indonesia

PT Aneka Inmas Sarana

Surabaya, Indonesia

PT Kia Serpih Mas

Jakarta, Indonesia

PT Angsa Daya

Jakarta, Indonesia

PT Kobin Keramik Industri

Mojokerto, Indonesia

PT Aria Victory Industry Ltd

Surabaya, Indonesia

PT Kokoh Inti Arebama Tbk

Denpasar, Indonesia

PT Asri Pancawarna

Karawang, Indonesia

PT Kuda Laut Mas

Surabaya, Indonesia

PT Cahayaputra Asa Keramik

Jakarta, Indonesia

PT Kuda Laut Mas

Surabaya, Indonesia

PT Chang Jui Fang Indonesia

Indramayu, Indonesia

PT Masterina Keramika Pratama

Jakarta, Indonesia

PT Metropole Megah

Jakarta, Indonesia

PT Danawajaya Nusa Industri

Jakarta, Indonesia

PT Metropole Megah

Surabaya, Indonesia

PT Datara Corporation

Banda Aceh, Indonesia

PT Muliakeramik Indahraya - Mkir

Bekasi, Indonesia

PT Ferro Additives Asia

Sidoarjo, Indonesia

PT Platinum Ceramics Industry

Surabaya, Indonesia

PT Ferro Mas Dinamika

Bekasi, Indonesia

PT Prospek Manunggal Eraindustri

Surabaya, Indonesia

PT Fumira

Jakarta, Indonesia

PT Roman Ceramic International

Jakarta, Indonesia

PT Granitoguna Building Ceramics

Jakarta, Indonesia

PT Sandimas Reksakeramika Granito

Bogor, Indonesia

PT Hi-Tech Agratektron Sempurna

Batam, Indonesia

PT Sarana Griya Lestari Keramik

Bekasi, Indonesia

PT Impero Granito Utama

Jakarta, Indonesia

PT Satyaraya Keramindoindah

Jakarta, Indonesia

PT Indopenta Sakti Teguh

Jakarta, Indonesia

PT Satyaraya Keramindoindah

Tangerang, Indonesia

PT Industri Keramik Kemenangan Jaya

Jakarta, Indonesia

PT Surya Siam Keramik

Tangerang, Indonesia

PT Intikeramik Alamasri Industri Tbk

Jakarta, Indonesia

PT Terracindo Nusantara Perkasa

Jakarta, Indonesia

PT Keramik Diamond Industries

Gresik, Indonesia

PT Tetrocindo Indahgraha

Jakarta, Indonesia

PT Chang Jui Fang Indonesia

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Analysis: Indonesia

Tableware production Indonesian ceramic tableware industry Ceramic tablewares

2012

2013

2014

2015

2016

2017

2018

2019

Tableware output in million pieces 275 275 290 290 290 290 290 300 Tableware production capacity in million pieces 275 + 275 + 290 + 290 + 290 + 290 + 290 + 300 + Source: Indonesian Ceramic Industry Association (ASAKI) Asian Ceramics note: ASAKI does not monitor non-organised tableware sector of SME (small and medium enterprises), which has substantial production, domestic market and exports. Tile production Indonesian ceramic tile industry DESCRIPTIONS

VOLUME

YEAR 2017

YEAR 2018

Est. 2019

CAPACITY

million m2/year

510

537

PRODUCTION

million m2/year

307

308

352 (Estimated)

-0,97%

0,33%

14%

m2/year

381,088,178

398,157,143

426,756,789

m2/capita/year

1.49

1.54

1.57

TREND TOTAL CONSUMPTION CONSUMPTION PER CAPITA Source: ASAKI, Indonesia Energy (gas and electricity) prices

Sanitaryware and roofing tile production

State supplied natural gas and electricity prices

Indonesian ceramic sanitaryware and rooftile industry outputs

1. Gas price in Indonesia is set in accordance to the region: West Java: USD9.16 per MMBTU East Java: USD7.96 per MMBTU North Sumatra: USD10.43 per MMBTU

Ceramics

2. PGN, the gas provider, has informed the possibility of 10-15% price increase before end of the year. It is seen as a threat to the industry

2017 (Production)

2018 (Production)

Est.2019 (Production)

Sanitarywares

5.2 million pcs

5.6 million pcs

5.4 million pcs

Rooftiles

75 million pcs

72 million pcs

Source: ASAKI, Indonesia

3. Regular hour rate (outside peak hour): USD0.07/kwh Peak hour rate (6pm-11pm): USD0.11/kwh Average rate the industry pays: USD0.081/kwh Source: ASAKI, Indonesia

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AC 20-5

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ADVERTISER FEATURE

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Analysis: Indonesia

Indonesian exports of ceramic products in value. Unit: US Dollar thousand Code Product label 6909

6911

6907

6910

6912

6914 6913 6902 6904

6901 6903

6905

6906

6908

Ceramic wares for laboratory, chemical or other technical uses; ceramic troughs, tubs and similar receptacles used in agriculture; ceramic pots, jars and similar articles used for the conveyance or packing of goods (excluding millstones, polishing stones, grindstones and the like of heading 6804; refractory ceramic goods; household articles; containers for shops; electrical devices, insulators and other insulating fittings) Tableware, kitchenware, other household articles and toilet articles, of porcelain or china (excluding baths, bidets, sinks and similar sanitary fixtures, statuettes and other ornamental articles, pots, jars, carboys and similar receptacles for the conveyance or packing of goods, and coffee grinders and spice mills with receptacles made of ceramics and working parts of metal) Unglazed ceramic flags and paving, hearth or wall tiles; unglazed ceramic mosaic cubes and the like, whether or not on a backing (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic goods, tiles specially adapted as table mats, ornamental articles and tiles specifically manufactured for stoves) Ceramic sinks, washbasins, washbasin pedestals, baths, bidets, water closet pans, flushing cisterns, urinals and similar sanitary fixtures (excluding soap dishes, sponge holders, tooth-brush holders, towel hooks and toilet paper holders) Tableware, kitchenware, other household articles and toilet articles, of ceramics other than porcelain or china (excluding baths, bidets, sinks and similar sanitary fixtures, statuettes and other ornamental articles, pots, jars, carboys and similar receptacles for the conveyance or packing of goods, and coffee grinders and spice mills with receptacles made of ceramics and working parts of metal) Ceramic articles, n.e.s. Statuettes and other ornamental ceramic articles, n.e.s. Refractory bricks, blocks, tiles and similar refractory ceramic constructional goods (excluding those of siliceous fossil meals or similar siliceous earths) Ceramic building bricks, flooring blocks, support or filler tiles and the like (excluding those of siliceous fossil meals or similar siliceous earths, refractory bricks of heading 6902, and flags and pavings, hearth and wall tiles of heading 6907 and 6908) Bricks, blocks, tiles and other ceramic goods of siliceous fossil meals, e.g. kieselguhr, tripolite or diatomite, or of similar siliceous earths Retorts, crucibles, mufflers, nozzles, plugs, supports, cupels, tubes, pipes, sheaths, rods and other refractory ceramic goods (excluding those of siliceous fossil meals or of similar siliceous earths, and refractory bricks, blocks, tiles and similar refractory ceramic constructional goods) Roofing tiles, chimney pots, cowls, chimney liners, architectural ornaments and other ceramic constructional goods (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic constructional components, pipes and other components for drainage and similar purposes) Ceramic pipes, conduits, guttering and pipe fittings (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic goods, chimney liners, pipes specifically manufactured for laboratories, insulating tubing and fittings and other piping for electrotechnical purposes) Glazed ceramic flags and paving, hearth or wall tiles; glazed ceramic mosaic cubes and the like, whether or not on a backing (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic goods, tiles specially adapted as table mats, ornamental articles and tiles specifically manufactured for stoves)

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AC 20-5

Exported Exported Exported Exported Exported value in value in value in value in value in 2015 2016 2017 2018 2019 98,248 99,868 120,331 126,521 90,170

91,331

92,485

81,681

74,654

76,085

8,616

6,778

64,959

79,437

64,017

24,827

21,399

22,845

26,633

26,406

23,076

19,640

19,749

20,297

19,690

4,937 4,933 526

4,804 6,055 768

5,667 6,309 1,682

6,235 5,625 1,130

9,131 6,083 1,008

739

1,307

1,120

704

952

398

443

577

746

730

4,285

3,435

2,385

796

581

1,014

1,187

528

453

484

78,226

77,000

10,911

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Analysis: Indonesia Indonesian imports of ceramic products in value. Unit: US Dollar thousand Code

Product label

Imported value in 2015

Imported value in 2016

Imported value in 2017

Imported value in 2018

Imported value in 2019

6907

Unglazed ceramic flags and paving, hearth or wall tiles; unglazed ceramic mosaic cubes and the like, whether or not on a backing (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic goods, tiles specially adapted as table mats, ornamental articles and tiles specifically manufactured for stoves)

159,176

181,199

242,807

325,880

272,556

6902

Refractory bricks, blocks, tiles and similar refractory ceramic constructional goods (excluding those of siliceous fossil meals or similar siliceous earths)

75,446

94,215

89,066

206,608

140,925

6903

Retorts, crucibles, mufflers, nozzles, plugs, supports, cupels, tubes, pipes, sheaths, rods and other refractory ceramic goods (excluding those of siliceous fossil meals or of similar siliceous earths, and refractory bricks, blocks, tiles and similar refractory ceramic constructional goods)

31,267

33,193

39,396

42,705

42,179

6910

Ceramic sinks, washbasins, washbasin pedestals, baths, bidets, water closet pans, flushing cisterns, urinals and similar sanitary fixtures (excluding soap dishes, sponge holders, tooth-brush holders, towel hooks and toilet paper holders)

10,531

12,770

15,304

20,408

23,376

6909

10,752

15,268

16,537

18,421

22,415

6911

Tableware, kitchenware, other household articles and toilet articles, of porcelain or china (excluding baths, bidets, sinks and similar sanitary fixtures, statuettes and other ornamental articles, pots, jars, carboys and similar receptacles for the conveyance or packing of goods, and coffee grinders and spice mills with receptacles made of ceramics and working parts of metal)

2,329

3,639

8,071

18,024

15,815

6913

Statuettes and other ornamental ceramic articles, n.e.s.

1,530

1,652

1,342

2,542

2,428

6914

Ceramic articles, n.e.s.

988

1,351

1,144

1,407

2,151

6912

Tableware, kitchenware, other household articles and toilet articles, of ceramics other than porcelain or china (excluding baths, bidets, sinks and similar sanitary fixtures, statuettes and other ornamental articles, pots, jars, carboys and similar receptacles for the conveyance or packing of goods, and coffee grinders and spice mills with receptacles made of ceramics and working parts of metal)

292

447

421

1,148

1,760

6904

Ceramic building bricks, flooring blocks, support or filler tiles and the like (excluding those of siliceous fossil meals or similar siliceous earths, refractory bricks of heading 6902, and flags and pavings, hearth and wall tiles of heading 6907 and 6908)

100

238

169

684

6905

Roofing tiles, chimney pots, cowls, chimney liners, architectural ornaments and other ceramic constructional goods (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic constructional components, pipes and other components for drainage and similar purposes)

791

495

1,080

571

260

6901

Bricks, blocks, tiles and other ceramic goods of siliceous fossil meals, e.g. kieselguhr, tripolite or diatomite, or of similar siliceous earths

167

118

162

6906

Ceramic pipes, conduits, guttering and pipe fittings (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic goods, chimney liners, pipes specifically manufactured for laboratories, insulating tubing and fittings and other piping for electrotechnical purposes)

102

6908

Glazed ceramic flags and paving, hearth or wall tiles; glazed ceramic mosaic cubes and the like, whether or not on a backing (excluding of siliceous fossil meals or similar siliceous earths, refractory ceramic goods, tiles specially adapted as table mats, ornamental articles and tiles specifically manufactured for stoves)

32,193

33,196

7,186

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AC 20-5

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The brand you can trust

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

Analysis: Roof tiles

A cap on de Middle Eastern roof-tile markets

AC looks at how a slowdown in construction activity has forced the roof tile sector into retreat. As costs begin to fall, will the region be able to turn around its fortunes?

he Middle East region has been one of the most vibrant construction market for the last two decades. Demand of ceramic products, including roofing tiles has grown at a steady growth rates in the region on account of fast growing building sector, which is driven by factors like growing population, economic and infrastructure development and modernization. Saudi Arabia is the largest consumer and producer of roofing tiles in the region, followed by United Arab Emirates. Other countries of the region- Oman, Qatar, Kuwait and Bahrain- too are emerging as sizable consumers of roof tiles. Roofing tiles fell out of fashion again for a short time at the end of the last century, but once more started gaining acceptance during the last fifteen years, due primarily to the popularity of the romantic revival architectural styles. Roof tiles have become popular in the region as these tiles protect the building, provide possibilities for the expression of regional identity and cultural heritage, they are aesthetic and durable. Hot climate of the Middle East region makes application of roof tiles very advantageous for the users. In fact, roof tiles have been known to stand up to the heat for centuries, regularly lasting as long as 50 years or more. The curved shape of the tiles makes a difference, as well, allowing air to circulate below the surface, which keeps roofs and interiors cooler. These days roof tiles are applied in the Middle East region for single-family homes and apartment houses, office and industrial buildings as well as for refurbishment projects. Variety of products has made it possible to install these products in nearly all type of constructions. No matter, whether it is a pitched or flat roof, a hip or saddle roof must be tiled, all roof shapes are feasible and every desired effect can be achieved â&#x20AC;&#x201C; from modern to traditional and from classic to extravagant.

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AC 20-5

Though, usage of roofing tiles have become possible on residential and commercial buildings alike, but residential sub-segment makes for majority of the roofing tiles applications in the Middle East region. The longevity of roofing tiles also makes it popular for the endusers. Roofing tile itself, when correctly installed, requires little or no maintenance. Often, it is the fastening system used to secure the tiles to the sheathing that fails and needs to be replaced rather than the tiles themselves. In fact, because roofing tiles frequently outlasted the building structure, it has not been unusual for them to be reused on another building. When the fastening system has deteriorated, or the roofing support structure has failed, roofing tiles can be removed relatively easily, necessary repairs can be made, and the tiles can be re-laid afresh.

Demand supply Gap

There is a significant gap between domestic supply and demand of roofing tiles in the Middle East region. Barring Saudi Arabia there is no large scale production of roofing tiles in the region. Even though a new project is coming up in the United Arab Emirates, it will be another six months when this plant will commence commercial production. As a result of the supply-demand mismatch, a significant volume of roofing tiles are imported in the region. European countries- Spain and Italy are the largest exporters of roofing tiles in the region followed by India and a few African countries.

Covid Impact

Prior to the onset of the Covid-19 pandemic, the Middle East was one of the fastest growing areas of the world economically. Currently, the region not only faces considerable economic impact as a result of the disease, it must also contend with a perfect storm of headwinds that include a weak oil market and contracting non-oil sectors.

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Analysis: Roof tiles

evelopment “The oil price is the main factor and Covid-19 is the second main factor affecting the market,” states Gaby Rhayem, regional director Middle East and Africa for Doosan Bobcat EMEA. “The regional economy is driven by oil. Oil is less than $50 a barrel which means no new projects, no investments, and projects reduced only to ensuring they get finished.” In illustration of these troubles, data and analytics firm GlobalData has cut its construction output growth 2020 forecast for the Middle East and North Africa (MENA) region to -2.4%, down from its previous forecast of 1.4%. “Construction activity for the remainder of 2020 is set to see poor performance,” states Yasmine Ghozzi, economist at GlobalData. “While there is usually weak construction activity in the holy month of Ramadan and during the hot summer months of June, July and August, this is usually compensated by strong performance at the beginning and end of the year. This will not be the case this year due to the strict lockdown policies that extended until the end of May.” Looking forward, the sector is expected to see a slow recovery in 2021, but the pace will be uneven across countries in the region. “Fiscal deficits and public debt levels will be substantially higher in 2021,” Ghozzi continues. “Fiscal consolidation will hinder non-oil growth across the region, where governments still play a considerable role in spurring domestic demand.” In addition to this, public investment is expected to be moderate at best, translating into fewer prospects for private sector businesses to grow, such as infrastructure.

Worsening struggles for UAE

Even without the onset of the Covid-19 pandemic, the construction sector in the UAE had been struggling due to project delays and cost overruns, not to mention a tepid adoption of technology. Those challenges have now been exacerbated by the effects of the coronavirus on this country’s workforce. Home to the international city of Dubai, the government of

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the UAE classified construction as a critical work sector at the outset of the pandemic, but there were many projects that had to be suspended or even cancelled due to preventive measures intended to protect workers. According to a report from MEED Middle East Business Intelligence, the UAE initiated a nationwide disinfection campaign on 26 March, with strict curfews in place. The UAE’s construction industry was one of the few sectors exempted from the lockdown during the nationwide sterilisation campaign. Project sites remained active, although operations were not spared from disruptions due to the virus with some countries in the Middle East still totally or partially under lockdown. “Before the real impact of Covid-19 was felt, we already found ourselves in a construction industry that was under tremendous pressure due to a lack of cash in the system,” Sean McQue, director of construction at UAE contractor Alec, was quoted as saying in the MEED report. “Businesses were unable to perform and deliver as they were carrying extensive legacy issues caused by non-payment for works they had already executed. The effects of Covid-19 have exacerbated this problem.”

AC 20-5

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Analysis: Roof tiles

The tradition of bidding at unrealistically low prices to win work leaves little margin to accommodate unexpected challenges down the line, McQue states. Contractors now find themselves struggling to absorb costs and fulfillment burdens. The economic slowdown has added strain on financial resources, including government spending for major infrastructure schemes, resulting in increased pressure around payments and cash flow. “On the back of what was an already shrinking market, the current Covid-19 situation, along with lower oil prices, is resulting in a low level of new project opportunities for designers and contractors, which is likely to lead to reduced volumes of work over the coming 12 to 24 months,” Jason Sams, construction divisional manager at UAE-based contractor Khansaheb was quoted as saying in the MEED report. “The low-price strategy being seen across the market is placing pressure on key parts of the supply chain, causing instability and unreliability, particularly financial, on resources and overseas procurement.” According to GlobalData’s Covid-19 Sector Impact review, the UAE construction sector posted growth of 3.3% in real terms in 2019, and was expected to grow by 4.3% in 2020, driven by government initiatives. However, following the Covid-19 outbreak and subsequent drop in oil prices, the firm now expects construction output to contract by 1.9% in 2020 with a recovery to 3.8% in 2021. US-based McKinsey Global Institute makes a similar prediction. “If things go well, construction activity could be back to pre-crisis levels by early 2021,” says Ghassan Ziadat, vice president of major projects at McKinsey & Company. “But longer-term lockdowns could mean it takes until 2024 or even later.”

Saudi Arabian giga-projects

The Kingdom of Saudi Arabia’s government implemented a 24-hour curfew from 23 March 2020 to help prevent the spread of Covid-19, with only workers in healthcare or critical sectors allowed out of their accommodation at certain times. Construction was not deemed to be a critical sector and while some permits were issued to allow essential projects to continue, construction projects were largely suspended. “Projects have been cancelled or are on hold,” notes Doosan Bobcat’s Rhayem. “Many investments are postponed or reduced to a strict minimum. We are seeing a big drop in the machinery industry, resulting from the project cancellations.” Not surprisingly, GlobalData has cut its forecast for construction output growth in Saudi Arabia to -1.8% from its previous forecast of 2.9% in 2020, but expects a recovery of around 3.3% in 2021. At the start of this year, a series of government-backed ‘gigaprojects’ were ready to move into their construction phase. These included the US$500 billion Neom future city project as well as a series of tourism developments. These projects were in addition to a raft of major government infrastructure schemes including roads, airports and railways, which were ready to start moving into construction. The commencement of these projects were put into doubt when the Organization of the Petroleum Exporting Countries (OPEC) and its non-OPEC allies failed to reach an agreement on oil production cuts as global demand weakened due to measures to contain the spread of the virus. However, it was recently reported that Saudi Arabia’s Red Sea Development Company (TRSDC) is preparing to award a further SR3.5 billion (US$933 million) of contracts by the end of the year on its Red Sea Tourism Project.

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AC 20-5

CONSTRUCTION ACTIVITY FOR THE REMAINDER OF 2020 IS SET TO SEE STAY POOR “Construction companies in the Gulf have been eagerly waiting for the next generation of Saudi projects to move into the construction phase since they were launched in 2017,” notes Colin Foreman at MEED. “In the years that followed, as those project delivery teams prepared masterplans and designs and appointed consultants, contractors that were desperate for new work felt frustrated by the lack of progress on site. In 2020, the lesson to learn is that developing large master-planned projects is a marathon not a sprint.” The TRSDC has already awarded about US$1.25 billion of work on its project so far, and by the end of this year, it intends to award another US$1 billion in contracts, according to reports. Smaller countries in the Middle East have not been spared the ravages of challenges similar to those faced by their bigger brethren. “GlobalData has cut further the growth rates for Qatar, Kuwait and Oman in 2020 to -3.4%, -7.8% and -8.1%, respectively,” Ghozzi says. “Qatar’s economy this year will be affected by decline in tourist arrivals, low consumer spending and low oil prices. Nevertheless, strong fiscal stimulus and spending on infrastructure projects should provide support. “The negative outlook for Kuwait is weighed down by lower oil prices and the prospect of a higher fiscal deficit, possibly compromising the government’s capital spending on construction and infrastructure,” she adds. “Business unfriendliness constitutes a barrier to reforms in the Kuwaiti economy; the extensions in tenders’ deadlines compounded by an inflexible bureaucratic procurement setup that slows decisionmaking will delay progress for several Kuwaiti megaprojects.” Meanwhile, Iran’s construction sector has a bleak outlook. A slowdown in economic activity caused by the pandemic and a possible wave of further US sanctions (in the event Trump wins a second term) suggest a drastic effect on construction activities and a continued negative impact on the economy. It’s impossible to predict the long-term effect that current circumstances will have on construction in the Middle East. With many governments in the region indicating their desire to push on with planned projects, not only to deliver on commitments already made, but also to provide necessary stimulus to the wider economy, the way of delivering such projects will likely be far removed from how they had been conceptualised. Forecasters within the region are generally predicting that construction costs will fall on any new projects that start in the near

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Analysis: Roof tiles Table 1 2014 2015 2016 2017 2018

term. With current restrictions and social distancing measures predicted to continue for the foreseeable future, however, it’s difficult to see how costs calculated against productivity under the traditional way of doing business can fall under the current circumstances.

97,029 98,506 100,121 101,350 102,189

Roof %le consump%on: Bahrain (sq metres)

Saudi Arabia

The Kingdom of Saudi Arabia is the largest producer and consumer of roof tiles in the Middle East region. With a consumption of nearly 6 million square meters of roof tiles in 2018, the country’s roof tile consumption has increased steadily in past ten years. Though, roof tiles have been used in both residential and commercial construction in the country, but usage of these tiles is more prominent in residential construction. Residential buildings make up a substantial proportion of the total building stock in KSA. Between 1990 and 2019, for example, more than 90% of the total new building licenses have been in the residential sector. Housing Units occupied with households by Administrative Areas, 2019 and demand forecast by 2024.

Table 1 2014 2015 2016 2017 2018

Yamama Factory for Red Bricks & Clay Products

396,890 399,241 404,864 408,108 411,479

Roof %le consump%on: Kuwait (sq metres)

Established 40 years ago in 1979, Yamama Factory for Red Bricks & Clay Products has been a frontrunner in red clay brick and roof tile production in the kingdom and has, over the years, not just brought about a significant improvement in terms of quality of products but has put together an enviable range of more than 90 different types and sizes of roofing tiles. The company is among the largest roofing tile producers in the Middle East region. Company’s roof tile plants are located at Muzahimiyah in Riyadh province with an installed capacity of 165 tonnes per day of roofing tiles. In addition to roofing tiles, the company also operates clay bricks production plants in the Kingdom. The company operates a total of five production plants in the Kingdom producing a wide range of roofing tiles, non-load-bearing blocks, load-bearing blocks, facing perforated bricks and pavers and roofing tiles. A leader in its field, Yamama produces roofing tiles of different 1 types that include French (Marsielli), Roman (Portuguese) and Ridge tiles. The tiles are available in a variety of colours in Housing Units occupied with households by Administrative Areas, 2019 and demand addition to the natural red colour. forecast by 2024. Demand Al-Sirat Saudi Company Traditional Region Apartment Villa Other forecast by House A Jordanian investment company, Saudi Al Sirat 2024 Company is a producer of roof tiles and red bricks Al- Riyadh 474,533 309,243 137,819 119,655 367,000 in the Kingdom of Saudi Arabia. Established in 1998 Makkah Alin Al Madinah, the company claims to have gained 723,159 103,271 412,167 42,271 382,000 Mukarramah a major share in Saudi and regional roofing tile Al-Madinah Al163,208 27,065 100,238 15,657 84,900 market. In addition to roofing tiles, the company also Monawarah produces clay bricks at its plant. Al-Qaseem

Saudi Red Bricks Company

Established in 1956 to cater to the brick demand of Saudi Arabian market, Saudi Red Bricks Company is among leading suppliers of roof tiles in the Kingdom of Saudi Arabia and extended region of the Middle East. According to Sheikh Khalid Al Amoudi, of Saudi Red Bricks Company, “Saudi Red Bricks Company ( SRBC) is a leader – a leader in size, volume, quality and innovation of red bricks and roofing

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AC 20-5

Eastern Region

45,634

61,056

54,623

20,279

54,000

289,395

163,589

104,271

23,867

169,200

132,860

18,678

85,200

40,473

6,045

40,200

Aseer

89,230

60,376

Tabouk

63,289

16,289

Hail

13,453

26,771

46,181

5,705

23,800

Northern Borders

10,234

16,287

8,816

2,788

14,100

Jazan

28,113

20,672

138,110

8,955

53,783

Najran

27,101

14,830

36,065

8,377

24,700

Al- Baha

25,288

9,207

30,277

3,991

18,700

Al- Jouf

22,659

25,111

17,374

5,278

15,100

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Look at the difference

Analysis: Roof tiles Table 1 2014 2015 2016 2017 2018

tiles. My father started this business with an Italian technology called soft mud extrusion, which uses a high content of water in the mix. In 1974 we signed a contract to use American technology. This was a first for its time. It was the merging of two technologies – European and American. We have a huge number construction projects in the pipeline, and a good number of these are in the Jeddah region. Of course, at the top of the list is housing. The demand is there, and it will keep growing, as we said, because of the young population and the big gap between the actual units that are provided in the country and the units that are needed. The Saudi population is young, and this is good for the economy. You have the seeds for a growing economy. The young population means demand, and you have supply because there is a good source of money and income in Saudi Arabia, and you have land. So, you have the three circles that can make an economy grow. The government has recommended that banks give loans to the middle class for houses. This is a caterpillar, and the middle class is what makes any economy grow. Because of that, SRBC has taken a huge step forward, and we are going to expand three-fold.”

Importers & Distributors

In addition to three major domestic producers, a number of importers and distributors of roofing tiles from Europe and other Asian countries operate in Saudi Arabian roofing tile market. Maidan Al Emarat Trading is among the largest supplier of imported roofing tiles in Saudi Arabia. The company respresents Tejas Borja Clay Roof Tiles Factory, Lliria (Valencia), Spain and Claudio Vogel Glazed Clay Roof Tiles, Brazil and Ceramica Laescandella Agostalicante, Spain. According to Mazhar Ali Qureshi, the company’s commercial and import manager, “Maidan Al Emarat is the sole and exclusive agent of all these three factories and is enjoying good business relations and facilities with them.Spanish clay roof tiles are perhaps the most reputed in the Saudi market, thanks to their quality and visual appeal compared to competing products. Quality-conscious people choose only Spanish clay roof tiles for the decoration of their homes. We have supplied roofing tiles in several projects, including the King Abdullah University of Science and Technology (Kaust), many royal and highprofile palaces in Riyadh, Jeddah, Eastern Province and Al Khobar. In addition, our principal Ceramica Laescandella supplied beach housing projects at The Palm islands in Dubai.” Maidan Al Emarat deals mainly in building materials, more specifically clay roof tiles, ceramic porcelain tiles and marble decorative countertops and steps. The company imports clay roof tiles from Spain and Brazil, ceramic and porcelain tiles from Thailand, and ceramic, porcelain and terracotta tiles from Spain. It also has a factory which designs and produces marble decorative products such as vanity tops for bathrooms and washrooms, marble tiles and all other related marble accessories for staircases. Established in 1999, the company has its head office on Old Al Kharj Road near Askaan Al Awal, and branches in Riyadh, Jeddah and Dammam. It also has warehouses in Jeddah and Riyadh, and a marble decoration factory in Riyadh.

United Arab Emirates

United Arab Emirates is the second largest consumer of roofing tiles in the Middle East region. Though, volume of roofing tiles used in the Emirates is far lower as compared to the market leader Saudi Arabia. One of the leading building materials supplier is currently in the process of setting up a roofing tile production plant in the Emirates. Supplied by Swedish technology supplier Abece AB, the roofing tile production plant is designed for multi-profile production and has future

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416,947 420,610 423,383 427,705 432,045

Roof %le consump%on: Oman (sq metres)

Table 1 2014 2015 2016 2017 2018

277,288 280,829 284,102 286,803 289,671

Roof %le consump%on: Qatar (sq metres)

upgrade capability for meeting high market demand. The supply comprises a complete package, including raw materials handling, mixing station, and equipment for field and trim roof tile production. “We are looking forward to a new successful installation and startup of the plant in Dubai and an exciting future together with our customer, UK Roof Tiles. The plant has been developed to meet the market demand in the region. The plant setup is designed to manufacture tiles with various coloring options, full body pigmenting, antique body pigmenting, top coating on both the wet and the dry side, as well as antique and splash coloring. The tried-and-tested extruder is upgraded with features such as a frequency-controlled roller speed and dripfree water spray nozzles for automatic knife cleaning. As a matter of course, the plant is equipped with 1 safety systems in accordance with the highest standards. The batching and mixing plant has been designed for a daily output of 32,000 tiles. It is fully automated and equipped with an advanced batching and weighing system including moisture measuring control to maintain the highest level of concrete consistency between batches, compared with conventional systems commonly used in concrete batch plants worldwide.” According to Karl Korsfeldt, Abece Sales & Marketing Manager. According to Al Fateh’s roofing tiles sales manager, Maher Farra, “In addition to the aesthetics, in the sunny and hot Gulf region, the

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Craven Fawcett Limited

member of Group Rhodes

Tel: +44 (O) 1924 375444 • Fax: +44 (O) 1924 290 245 Email: sales@cravenfawcett.co.uk • www.cravenfawcett.com

Analysis: Roof tiles design of the buildings’ envelope has a major role in determining the cooling loads, and thus, the electricity consumption of the air conditioning systems. The roof represents the most exposed element of the envelope of a building. With a high ratio of roofing tiles in the envelope, one can reduce the consumption of electricity and cooling requirement by many percentage points. We are the sole distributor for Togana brand Italian Clay Roof Tiles in UAE. Our partnership with Tognana for nearly two decades has completely changed the roof tiles scenario in the UAE. We were the first company to introduce waterproof roof tiles in UAE which was very well accepted by endusers. At any point of time, we stock 10,000 sqm of clay roof tiles of various types and models such as natural half round Portogese type, Marsiglisie, various Antique types, Mediterranean Smart, fully brown, flat tiles, Coppo tiles, Tuscany Coppo, glazed & matt finish tiles and all accessories in our warehouses located in Dubai, Abu Dhabi & Ras Al Khaimah( RAK).”

Bahrain, Kuwait, Oman and Qatar

Rest of the GCC countries- Bahrain, Kuwait, Oman and Qatar collectively accounted for about 17 % of the roofing tiles consumed in the Middle East region in the year 2018. Despite, the current lower numbers, growth of roof tile consumption has been higher in these four countries in last few years. In fact, growth of demand of roofing tiles in some of these countries have been higher than the two leaders ( Saudi Arabia and United Arab Emirates) in some of the recent years. Lesser number of high rise constructions in these countries as compared to Saudi Arabia and United Arab Emirates is the major reason of the higher growth. Hassan Jahangir, General Manager of RAFCO Qatar a distributor of roofing tiles for Italian brands IBL and Ceipo Ceramiche says, “ Last few years have been good for roofing tile industry in Qatar. Number of enquiries handled by our company has nearly doubled in last three years. We have supplied for than 20,000 square meters of roofing tiles in the last year alone.”

latest technology and the development of innovative improvements in our production process, we have become one of the most important roofing tile producing companies. A family business, Ceramicas Mazarron launched operations in 1972 in Toledo, Spain, as a brick manufacturer and in 1990 extended its range to roof tiles. It is the third largest manufacturer in Spain with a production capacity of over 30,000 roof tiles per day. Last year, it completed the upgrade of its production lines to the H-Cassette manufacturing process, which involves the use of individual ceramic supports that keep each roof tile isolated from the other, thus enhancing the finishing of the tiles. Spanish company Tejas Borja, one of the leading names in global roofing tiles industry is an important supplier of roof tiles in the region. The company claims that it has world’s largest sized roofing tiles in its production kitty. In 2018, Tejas Borja becomes the first company in the sector to use Inkjet printing in the industrial production of ceramic roof tiles. Borja Therm is an exclusive thermal insulated roofing system, a completeTable solution for external insulated pitched roofs, designed 1 for use both in repairing and refurbishing roofs on old buildings or creating2014 new projects. 4,089,365 4,278,111 Tejas2015 Borja has supplied roof tiles to a number of prestigious 2016 4,465,703 projects2017 including Royal Amwaj (Palm Jumeirah – Dubai), Al Raha 4,681,270 4,871,177 project2018 ( Abu Dhabi) and Royal Amwaj ( Palm Jumeirah). Roof %le consump%on: Saudi Arabia (sq metres)

Opportunities abound

Growing usage of roof tiles in the Middle East region is presenting ample opportunities for domestic and international roof tile producing companies in the region. A number of leading roofing tile producers from Europe have beniffited immensely from the market opportunities. Some of these producers are selling their roofing tile products through the Middle East based distributors, while a few are selling directly from their respective countries. Spanish roofing tile producer Ceramicas Mazarron is one such company. The company has supplied roofing tiles to a number of projects in the region. According to Export manager of Ceramicas Mazarron, Cesar Gil, “Saudi Arabia now accounts for 45 per cent of the total construction industry in the Middle East and is poised for tremendous growth over the next five years with 700 new projects set to be launched in the coming months that are targeted for completion by 2022. These include projects like the Faisaliah City in Makkah, Dahiyat Al Fursan in Riyadh, and Al Ruwais Redevelopment and New Jeddah Downtown, in Jeddah. Our company has embarked on a plan to increase sales in various parts of the world, adding it has a good presence in the Gulf countries and already sells on a regular basis to the UAE, Iraq, Oman and Qatar. Ceramicas Mazarron also intends to expand and launch new products to suit customers’ taste and requirements. We want to be a reference company in the Gulf region and participate in beautiful and iconic projects that will allow us to contribute our expertise to the area and Saudi Arabia. Thanks to continuous efforts, the use of

asian ceramics

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Table 1 2014 2015 2016 2017 2018

989,678 1,071,043 1,110,803 1,202,831 1,367,210

Roof %le consump%on: UAE (sq metres)

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HER_AsianCeramics_254x86_04_20_print.pdf 15.04.2020 13:24:29

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Analysis: Egypt

Rising po Egyptian sanitaryware in the ascendency

s the largest sanitary ware producing nation in the Middle East and North Africa ( MENA) region, Egyptian sanitary ware industry is undergoing through a challenging period. Though, as compared to most of its regional peers, Egyptian sanitary ware industry stands at a better footing. Egyptian sanitary ware industry has not been as badly impacted due to ongoing Covid 19 crisis as most of other Asian and African sanitary ware producers have faced. Last year (2019) was a difficult year for Egyptian sanitary ware producers with weakness in demand in Egypt worsening over the year. In addition to the weakness in the domestic market, some of the key export markets for country’s sanitary ware producers were also affected due to economic slowdown in the year. The strengthening of the Egyptian Pound also squeezed revenues and margins for the sanitary ware producers in export markets. In 2019, the Egyptian Pound strengthened by almost 10% against the Euro and the Sterling and 4% against the Dollar impacting Egyptian sanitary ware exporters average price in exports. Egypt consumed 5.70 million pieces of sanitary ware in 2019. Most of this demand is catered by large and medium domestic producers and only premium products are imported into the country from Europe and the Middle East producers. Being a low cost ceramic producing country, Egyptian producers are significant exporters of sanitary ware to Europe, the Middle East and African countries and almost all of the producers export to one or more of these markets in varying degree. Egyptian demand – which has been under pressure for several years as a result of the austerity measures enacted in 2017 following the floatation of the Egyptian Pound – has started to show some recovery as lower inflation and lower interest rates return some purchasing power. There were small sign of this recovery by the late 2019, before Covid struck in March. However, most of the Egyptian

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sanitary ware producers are of the opinion that next cycle of demand growth is due by the end of the current year. A significant proportion of total output of sanitary ware in the country is exported to European, Asian and other African nations. In fact, Egypt has emerged one of the largest ceramic sanitary ware exporters in the Middle East and Africa region. Egypt's exports of sanitary ware was at UAD 64 million dollars in the first quarter of 2020, down 13.5 percent from the corresponding period of 2019. Libya, Germany, Yemen, Britain, Jordan, Turkey, Sudan France and Saudi Arabia take 72 percent of Egypt's sanitary ware exports, according to the data from Egyptian Export Council for Building Materials, Refractory & Metallurgy Industries.

Keeping costs low…

Reasonable energy costs, low labour cost and low investment costs had made Egypt as one of the lowest cost producers of sanitary ware products. These factors have made Egypt a major export hub of sanitary ware products. In Egypt manufacturing cost ranges between USD 11 to USD 12.80 per piece of sanitary ware, whereas production cost for the regional sanitary ware producers ranges between USD 15- USD 30 per piece. Manufacturing cost of sanitary ware in Europe is more than USD 30 per piece. Sanitary ware investment cost approximately varies between USD 30- USD 40/ piece in the country as compared to global range of USD 35- USD 55 per piece. Low shipping cost to Europe ( About USD 1.50 per sanitary ware piece vs. approx. USD 6+ for Asian sanitary ware producers) also makes Egyptian sanitary ware producers more competitive in the key European markets as compared to most of the Asian rivals.

Rising manufacturing costs

Though, Egyptian ceramic sanitary ware producers have enjoyed a significant cost advantage for the production of sanitary wares

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Analysis: Egypt

owers this may not be set to continue forever. Certainly, in the last few years there has been a steep hike in some of the major factors of production. Energy, labour and raw material cost have increased disproportionally for Egyptian sanitary ware producers in last few years. Since July 2014, the Egyptian government has pushed through a series of significant cost increases on energy which have continued on an annual basis. The impact of these increases is approximately 165% increase in annual total costs for sanitary ware producers in these six years. These energy price hikes have led to significant inflation (compounded by currency) across the board in Egypt including labour costs. Sanitary ware producers are anticipating a few more hikes in natural gas, electricity and petrol prices in the coming two years.

the entire region, noting in the same context that Egypt has reported close rank with the United Arab Emirates (UAE), the strongest market in the region, and considered  higher than the global and regional average. The report pointed out that Egypt registered the second strongest economy in the MENA region, and this was driven by a relative improvement in the economic outlook, after the country continued to score strong points in terms of short-term political and operational risks. Moreover, the value of the current construction industry in Egypt is about $ 25 billion, and it is expected that sustainable growth in the sector will push this value to reach more than $ 89 billion by 2029, which will make Egypt represent about 30% of the value of the construction industry in the entire region. The report also praises the role of public-private partnerships run by the Ministry of Finance, which succeeded in improving transparency during the bidding process, translated into more confidence on the part of Investors and companies, as opportunities available in Egypt for green projects will continue in a way that exceeds its peers at the regional level, which is evident through the establishment of the new administrative capital.

Positive futures? The rise of Egypt’s construction sector in recent years has brought with it major opportunities for local and regional ceramic sanitary ware producers that were hungry for new work as project activity in other key markets slowed down. Current state of construction activities in Egypt points towards promising days for Egyptian and regional sanitary ware producers. Global Rating agency Fitch has recently released a report on the future expectations of the construction Covid 19 impact sector in the MENA region after the Much like the rest of the world, Covid repercussions of the spread of the coronavirus, where Egypt is 19 has had an adverse impact on sanitary ware industry in Egypt. For expected to surpass the rest of the markets in the long term. The example, during the first six months of 2020, country’s largest sanitary report included expectations that the construction sector in Egypt will ware, Lecico’s revenue from sanitary ware division were down 31% continue its strong growth over the next ten years, so that the average to LE 518.6 million and volumes were down by 29% to 1.7 million annual growth rate will be 9% between 2020-24, after being affected pieces as compared to the same period in the year 2019. in the near term by the Of the 1.7 million corona pandemic. pieces, 67.1% of the Energy cost hikes in Egypt over the years As Egypt ranks fourth volume came from Description Increase since 2014 Impact on sanitary ware production in the current stage as exports. Covid’s impact Natural gas 455% from an average LE/ Approximately 22 % of Costs of Good Sold the largest construction was more prominent mbtu of LE 17.4 to LE 96.7 market in the region, the in the April- June 2020 Electricity 404% from LE/KwH of LE 0.25 Approximately 6% of Costs of Goods Sold period. During these Fitch report expects that to LE 1.26 by 2029, Egypt will have three months, Lecico’s Disel/ Petrol prices 514% from LE/ltr of LE 1.10 to All goods, materials and personnel the largest construction sanitary ware revenue LE 6.75 transport affected and building market in were down by 44% to LE www.asianceramics.com

AC 20-5

asian ceramics

Analysis: Egypt

MANUFACTURING COSTS RANGE FROM US$11 TO US$ 12.80 PER PIECE

213.1 million, volumes were down by 41% to 0.73 million pieces as compared to the three months period in the year 2019. The company was also forced to shut down its Al Borg based production facility for a period of two weeks due to Covid cases. Other Egypt based sanitary ware producers too have reported a loss in sales in the first six months of the current year. Drop in sales was more prominent during the April- June period.

Leading sanitary ware producers in Egypt

Egypt was the first country in MENA region to have a multinational sanitary ware producing company in the country. Ideal Standard entered the country as far back as 1982. Stable government and industry friendly policies prompted others to follow in the low cost producing countries. Duravit and Roca followed the American company in pursuit of large Middle East and African markets. Domestic sanitary ware giant Lecico continues to grow in size and currently account for a major share of the total sanitary ware produced in the country. Other domestic companies too have established state of the art sanitary ware production plants. Leading ceramic sanitary ware producers in Egypt Company Manufacturing Location Lecico

Borg El-Arab, Khorshid

Aracemco

10th of Ramadan City

Cleopatra Group

6th of October Industrial Area

Gravena

Abu Zaabal

Ideal Standard

10th of Ramdan City

Duravit

Alexandria

Pharaohs Ceramic Group

Salah Salem St.  Heliopolis

Lecico

With an installed capacity of 6.7 million pieces of sanitary ware per annum, Lecico is the largest producer of ceramic sanitary ware in Egypt. Not alone Egypt, Lecico is also among the largest sanitary ware producer in the extended Middle East and North Africa ( MENA) region. Besides two manufacturing facility in Egypt, the company has a production plant in Lebanon. With over 45 years of experience in sanitary ware sub-segment, Lecico has captured almost 40% share of Egyptian sanitary ware market. The company has an installed capacity of 6.7 million pieces Lecico claims that it benefits from significant cost advantages in labour, energy and investment costs resulting from its economies of scale and location in Egypt and Lebanon. Company’s marketing strategy is to use its cost advantages to target the mass market with high quality pieces at competitive prices. Lecico exports over half its sanitary ware production and has a significant presence in the United Kingdom and other European markets. Most of the Company’s exports are done under the Lecico brand, although it also produces for a number of leading European brands. In 2019, company’s sanitary ware sales volume decreased by 12% to 4.7 million pieces (down 621,699 pieces). Egyptian volumes fell 20% (down 339,653 pieces), export volumes decreased 8% (down 283,981 pieces), while sales in Lebanon increased by 2% (up 1,935 pieces). The company cited that drop in exports came primarily from OEM with two key customers sharply reducing their volumes year-on-year due to lower sales outwards. The Company had strong sales growth in the Middle East as the recovery of Libya continued from late 2018 throughout the year.

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According to Lecico Egypt Chairman, Gilbert Gargour , “The second quarter of 2020 saw a fuller impact of the coronavirus pandemic on operational results. Our usual strong point of sanitary ware export sales was substantially lower as a result of closures in European markets. The picture remains uncertain and – for us – much depends on whether export markets continue to recover and whether Egyptian demand remains consistent. Given the lack of clarity about how the virus will behave and how this will affect economic activity it is wise to remain cautious and prepare for a challenging year-end.” Speaking on the occasion of release of 2020 second quarter’s results, Taher Gargour, Lecico Egypt CEO, said , “I think the impact of the coronavirus on our business in the quarter was less severe than could have been imagined. Our split of activity between Egypt and export protected us from the worst of the contraction in European and Middle Eastern markets early in the quarter and we have seen a pretty sharp bounce back in most of our markets although sales are still not back to pre-COVID levels.” Lecico sanitary ware performance over the years

2015

2016

2017

2018

2019

Installed capacity (m. pieces)

6.750

Sales volume (m. pieces)

4.835

4.990

5.061

5.321

4.699

Capacity utilisation (%)

72 %

74 %

75 %

79 %

70 %

Egypt sales volume (m. pieces)

1.995

2.183

1.825

1.728

1.389

Lebanon sales volume 109,000

151,000

146,000

106,000

108,000

Export sales volume (m. pieces)

2.730

2.655

3.091

3.486

3.202

Exports as % of total sales

56.5%

53.2 %

61.1%

65.5%

68.1 %

Aracemco The Arab Ceramic Company (Aracemco) is among the top three producers of sanitary ware by installed capacity. The Company's products feature a range of different models, sizes and colors of sanitary ware sets, single pieces and accessories. Established in 1975, Aracemco has an installed capacity to produce 2.5 million pieces of sanitary ware. The Company has its head office in Cairo, while its manufacturing plant is located in Abu Zaabal area. www.asianceramics.com

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Analysis: Egypt

Table 1 2013 2014 2015 2016 2017 2018 2019

9.61 9.28 9.73 10.41 10.98 10.01 10.7 Egyptian sanitaryware production (m. pieces)

The company reported a 61% Year on Year decline in its net profit in the first half (H1) of 2020. Net profit stood at EGP 5,279,302 in H1 of 2020, compared to EGP 13,833,087 achieved in H1 2019. In 2019, the company posted net profit of EGP 18,637,372, compared to EGP 22,917,633 posted a year ago.

Duravit In 1999, Duravit AG with headquarters in Hornberg, acquired more than 51% of the shares in an Egyptian company, becoming the majority shareholder. Founded in 1997, a sanitary ceramic plant was built in the Cairo region, which went in production at the start of 1999. The products were marketed under the Duravit brand and the company was called Duravit Egypt Sanitaryware Manufacturing Company S.A.E. In 2002, Duravit acquired a majority shareholding in another Egyptian company, Saniacrylic, which was a large producer of acrylic bath tubs. The Duravit shower trays, baths and wellness products are now manufactured by this company, which is also situated close to Cairo. In 2008, production capacities in the ceramic plant were increased to 2 million large parts per year. In 2018, Duravit installed a new tunnel kiln at this plant. Equipped with 8 modules with effective internal dimensions of 15x4.4x2 metres, the kiln has a cordierite/mullite refractory lining which avoids the need for maintenance on exposed fibres and the consequent risk of product defects. It is also equipped with a rapid cooling system which ensures that the entire first firing cycle is completed within 14 hours. For the year 2019 results, which were announced in June 2020, Duravit management specifically mentioned that Egypt operations have brought very good numbers for the company.

Table 1 2013 2014 2015 2016 2017 2018 2019

5.49 5.58 5.41 5.63 5.76 5.83 5.7

Egyptian sanitaryware demand (m. pieces)

Table 1 2013 2014 2015 2016 2017 2018 2019

3.63 3.73 3.64 3.88 5.76 4.46 4.84

Egyptian sanitaryware production (m. pieces)

Ideal Standard Egypt

Ideal Standard was first multinational sanitary ware producer to start production in Egypt. The company, which set up its manufacturing of ceramic sanitary ware in 1983 in 10th of Ramadan city has made Egypt an important base for catering to Egyptian and country’s neighboring markets. The manufacturing process at ideal Standard Egypt involves a unique combination of Ideal Standard’s most advanced technologies alongside with skillful, experienced and intensively trained labor work. The overall processes of material testing, slip and glaze preparation, casting, drying, spraying, firing and testing till the final stages of packaging and storing are performed under very strict quality standards. According to Ahmed Hafez, Chief Executive Officer at Ideal

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www.asianceramics.com

TechTalk

Analysis: Egypt Standard MENA, “Since 1983, our wide range of products has been able to earn our customers’ trust through providing unique, durable, and functional solutions,” Throughout its presence in the Egyptian market, the company’s production and export volumes recorded a growing increase from 15% in 1990, to 50% in 2018. Ideal Standard currently operates through 47 factories around the globe, 6 (Company’s first plant produces ceramics, our second fittings, the third and fourth acrylic tubs, the fifth shower enclosures and the sixth acrylic sheets ) of which are in Egypt’s 10th of Ramadan City. Covering a land area of 100,000 m2, and creating 3000 jobs make Ideal Standard one of the most contributing companies to the sanitary ware industry in Egypt over the past three decades. We are focused on both export and domestic sales. 60% of our production is exported globally with Europe, in particular, being a key export market for our products. The remaining 40% is sold nationally, and the market is increasing thanks to new megacities sprouting throughout Egypt.”

Pharaohs Ceramic Group

Pharaohs Ceramics Group is among the top six producers of sanitary ware in Egypt. A diversified group producing tiles and porcelain besides sanitary ware, Pharaohs Group was

established in 1986. The company initially started producing tiles with two factories, one located at Fayoum city (80km from Cairo) for wall tiles and another in Alexandria city (340km from Cairo) for floor tiles, with capacity of about 10000 sqm/ day. Pharaohs Ceramic Group now has an installed capacity of one million pieces of sanitary ware and 25 million sqm of ceramic tiles.

Cleopatra Group

Cleopatra Group is among the most recognized ceramic producers in the Egyptian market. The Cairo-based Cleopatra Group is the largest ceramic tile producer in Egypt. The company ventured into ceramic sanitary ware production in 1992. Cleopatra Group operates two production facilities in Suez Special Economic Zone. Using state of- the art technology highly sophisticated machines and equipment the company has an installed capacity of 1.6 million pieces of sanitary ware. Mohamed Aboul Enein, Chairman of Ceramica Cleopatra Group, is one of the most prominent personalities in Egypt. In 2018 The African Union (AU) chose Mohamed Aboul Enein to win the Best Industrialist Award in the African Continent. The Cleopatra group owner was able to cement himself as one of the world’s most renowned businessmen as Cleopatra is currently one of the leading ceramic producing companies in the world.

Lecico Egypt

Ideal Standard

Location: Borg El Arab, Khorshid Products: Ceramic sanitary ware Markets: Domestic and export markets Others: Known more for its sanitary ware producing prowess , Lecico is the largest sanitary ware producer in the Middle East and North Africa region. Company’s three state of the art plants have a cumulative installed capacity of 6.7 million pieces per annum. Established in 1959, the company has been majority owned by the Gargour family since 1969. The company has a global competitive advantage making European quality sanitary ware at Egyptian costs. Nearly 45% of Lecico’s sanitary ware sales volume is exported to Europe.

Location: 10th of Ramadan City Products: Ceramic sanitary ware Markets: Domestic and Export Markets Others: Ideal Standard was first multinational ceramic sanitary ware producer to enter into Egyptian sanitary ware industry. The company entered into Egyptian market in 1983. The company operates a total of 6 production plants in the country. Though, only one of it produces ceramic sanitary ware products. The other plants produces fittings, acrylic tubs, shower enclosures and acrylic sheets. Ideal Standard exports nearly 60 % of its output from Egyptian operation to Europe and other African countries, while 40 % is meant for domestic market.

Cleopatra Ceramics

Pharaohs Ceramic Group

Location: Cairo Products: Ceramic sanitary ware Markets: Domestic and export markets. Others: Based on the outskirts of Cairo, Ceramica Cleopatra is one of the leading sanitary ware producers in Egypt. In addition to sanitary ware products, the company is largest manufacturer of ceramic tiles in the country. Established in 1983, it has become one of the largest private corporations in Eygpt and one of the world’s largest ceramic, porcelain and sanitary ware producers. Its integrated industrial complex of 17 plants employs 25,000 people and the business now exports to 108 countries worldwide.

Duravit Egypt

Location: Cairo Products: Ceramic sanitary ware Markets: Domestic and Export Markets Others: Leading multinational ceramic sanitary ware producer Duravit entered in Egypt by acquiring a majority stake in an existing sanitary ware producer near Cairo. In 2002, Duravit acquired a majority shareholding in another Egyptian company, Saniacrylic, which was a large producer of acrylic bath tubs. The Duravit shower trays, baths and wellness products are now manufactured by this company, which is also situated close to Cairo. The company has an installed capacity of 2 million large pieces per year.

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Location: Alexandria city Products: Ceramic sanitary ware Markets: Domestic and Export markets Others: Pharaohs Ceramic Group is among leading producer of ceramic sanitary ware producers in Egypt. Much like some of the other sanitary ware producers, the company is also a leading producer of ceramic tiles. To complement its product offering, the company ventured into ceramic sanitary ware production. The company has an installed capacity to produce one million pieces of sanitary ware products.

The Arab Ceramic Company (Aracemco)

Location: Abu Zabbal Products: Ceramic sanitary ware Markets: Domestic and Export markets Others: Established in 1975, Aracemco has an installed capacity to produce 2.5 million pieces of sanitary ware. The Company has its head office in Cairo, while its manufacturing plant is located in Abu Zaabal area. The Arab Ceramic Company (Aracemco) is among the top three producers of sanitary ware by installed capacity. The Company's products feature a range of different models, sizes and colors of sanitary ware sets, single pieces and accessories.

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Talking Shop

Talking Shop In focus:

Coming out of COVID In this issue’s Talking Shop, AC discusses with two of Asian continent’s major ceramic material suppliers about how they have managed to cope with this year, and what their plans are for the post Covid-era. Natesh Krishnan, General Manager, Engineered Ceramics of Saint-Gobain Performance Ceramics & Refractories in India and Danny Tsai, Special Assistant to the Managing Director of China Glaze Co. Ltd in Taiwan spill the beans… AC: How are you both coping during the present crisis in terms of being able to stay in operation? SAINT GOBAIN: It has indeed been a challenging time for all businesses and their employees around the world including Saint Gobain. Our best wishes to anyone reading this article that has been personally affected by this crisis. From day one, Saint Gobain has taken this pandemic seriously and has spared no efforts to ensure the safety DANNY TSAI, China Glaze and well-being of all our employees. Co. Ltd Detailed guidelines, which incorporated country-specific regulations, were implemented in all our locations worldwide. A newly-formed ‘COVID’ taskforce coordinated the global response for our eleven sites worldwide by issuing guidelines and adapting the same as the situation evolved. Thanks to these efforts, all our sites have remained operational throughout the pandemic (except one that had to briefly shut down given the country regulations) and more importantly, our employees have remained safe. We credit this success to the amazing response from our worldwide teams as well as to the existing safety culture in Saint Gobain. We also worked closely with our customers to ensure that their needs were met as best as possible given circumstances, and thank them for their patience and support. CHINA GLAZE: In this crisis, China Glaze adjusted and optimized factory production capacity in response to the decrease in market demand, developed new alternative materials in terms of products; re-examined manpower and resources in organization, and strengthened education and training; administrative aspects changed the way of dining, Reduce the frequency and time of

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direct contact with employees, and track employees' body temperature daily. China Glaze has cooperated with the government's decree to thoroughly implement the epidemic control. There is no shortage of personal masks for our employees and the competitiveness of the company can be also maintained. AC: What is your current status and what are your plans to get back to full service? NATESH KRISHNAN, SAINT GOBAIN: Fortunately, as stated Saint-Gobain Performance earlier, we are fully operational now and Ceramics & Refractories intend to keep our plants running while abiding by all local regulations and our internal guidelines. In fact, the experience over the past six months has reinforced our ability to operate safely under trying circumstances and we feel we are better prepared now to more effectively address the needs of our customers when markets rebound. At the same time, we have kept our guard up as we realize that we still in the midst of the pandemic. Our ‘COVID’ taskforce remains fully operational. CHINA GLAZE: In the first half of this year, in order to prevent the epidemic, in Southeast Asia some countries locked down to avoid the spread of the epidemic. As a result, our overseas production bases reduced production capacity to cope with it. Because of the well-controlled epidemic in Taiwan, the supply and demand situation in the tile market affected not too much. Since the second half of the year, the production capacity of all customers has gradually recovered. In addition to reducing the chance of customer visits, we keep close contact with our customers by the net or video conference and have now fully resumed normal operations.

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Talking Shop

WE HAVE ADOPTED A DEFENSIVE STRATEGY DURING THE EPIDEMIC DANNY TSAI AC: What changes will there be in the way your operation your business going forward? Will you work more over videoconferencing, or will you continue to travel to meet with your customers personally? CHINA GLAZE: We have always established long-term cooperative relations with our customers, and our customers also trust the service and advice of the professional team of China Glaze. It cannot be denied that these relationships in the past were based on face-to-face communication, because the relationship between the epidemics has greatly changed the Business model in the past, but we believe that the epidemic is short-lived, and everyone will return to normal life in the near future. During this transitional period, unless necessary, we will try to avoid business trips to visit customers in face, and continue to help our customers solve problems assist by telephone or internet video conference. SAINT GOBAIN: As with other businesses, we have had to adapt rapidly to the restrictive measures the pandemic has forced us to take, including travel restrictions, gatherings, and how we work in our factories. It has forced us to rethink how we operate in each of our functions. Teams that absolutely need to be present to keep our manufacturing operations running have been provided with a safe environment so they continue to operate as before in our offices and factories. We have offered greater flexibility to other staff such as our commercial teams to strike a balance between remote and office presence. We expect this will continue. It is amazing how all our teams as well as our customers have adopted new digital collaboration tools including video-conferencing to keep the business going. As much as we want to meet with our customers, they too are eager to communicate and meet with us about their needs in order to find a solution. Tools such Microsoft TEAMS has greatly enabled this remote interaction. In several cases, we are ‘meeting’ more often than we did before. We are also doing virtual ‘plant tours’, product demonstrations and inspections using digital means. Saint Gobain continues to invest heavily in our digital infrastructure to prepare for the ‘new normal’. While I believe face-to-face meetings with customers will resume after the pandemic, it would likely be reduced significantly as we would have found other ways to collaborate effectively. Apart from lowering our travel-related costs, another silver lining to this reduced travel would be our reduced carbon footprint! 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 Asia? CHINA GLAZE: As the epidemic is still happening, I thought it would stop in the summer. However, according to the recent situation, the epidemic has returned. Therefore, even if the customer resumes production, it will only recover at most about 80%. This does bring some negative effects to the entire industry. SAINT GOBAIN: We are a truly diverse company with a global presence including many locations in China and South Asia. We pride ourselves on the diversity of our teams from all regions and countries – we value the talent they each bring and their contributions, and appreciate our

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partners and customers. As such, Asia remains an important part of our business strategy and we expect this to continue. AC: What sector of the ceramics industry do you think will be the hardest hit by this crisis, and do you have any idea as to how the industry can ‘bounce back’ quickly? SAINT GOBAIN: The energy and automotive sectors have been affected significantly by the crisis; however, both seem to be rebounding now to different extents depending on the region. The rate of rebound will depend on how quickly we can develop and distribute an effective vaccine and therapeutics, thereby opening up our economies again. And how effectively we can prevent a possible ‘second’ wave of the pandemic. I am an optimist though and believe the ceramic industry overall will emerge stronger from this crisis. CHINA GLAZE: From my point of view, the impact of the current crisis will be more on the factories that require more manpower, such as ceramic tile factories. At present, the number of infected people in the world is still increasing. The factory may be shut down through human-to-human transmission, International ceramic exhibitions have also been stopped, which will have a certain degree of influence on the exchange of trends in the tile market. China Glaze has international resource platform to continue to provide customers with the latest market news and product trends… such kind of information. AC: Are you looking to expand more overseas or will you concentrate more domestically at the moment until the industry steadies itself again? CHINA GLAZE: China Glaze has adopted a defensive strategy during the epidemic. In addition to re-adjusting the organization internal resources, maintaining existing domestic customer relationships, and focusing on new product research and development, for example, this year we developed a new generation of anti-slip glaze and antibacterial materials Functional products, customers are highly interested in new products in this area. SAINT GOBAIN: With 11 manufacturing locations worldwide, our customers and partners are global in nature. Each of our locations has some unique capabilities and products that are valued by our worldwide customer base. We have continued this effort through the crisis. AC: Many people think that exhibitions / tradeshows will be virtually impossible for the next 6-12 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? SAINT GOBAIN: Tradeshows are an important part of our overall strategy – we connect with many of our customers there and the sows enable us to remain close to market while showcasing our product and technology advancements. As we have witnessed, most, if not all tradeshows have been cancelled over the past six months given safety concerns. Till we can ensure a safe return, we will continue to employ digital (video-conferencing, webinars, etc.) means to keep in touch with our customers. CHINA GLAZE: It is true that exhibitions and chambers of commerce do affect the chances of product exposure and reduce face-to-face contact with customers, but this is not the only sales channel for China Glaze. Our marketing team has been always keeping close contact and communication with customers. Although affected by the epidemic, thanks to the Internet, it can help us continue to connect with customers and business partners through video or social media and expressing our care. During this period of time, China Glaze strengthened our marketing team, and developed potential customers through various

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Talking Shop

WE HAVE HAD TO ADAPT RAPIDLY TO THE RESTRICTIVE MEASURES NATESH KRISHNAN online marketing tools and media, and used this to activate social networks, giving the company an innovative and energetic image. 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? CHINA GLAZE: I think that in the face of post-epidemic life, there will be some adjustments and changes in entertainment, catering, tourism or a large number of social activities that require people to gather and contact, and people’s requirements for medical treatment or public health will also increase. Material technology and products have therefore attracted the attention of the market. Industrialization is not the cause or triggering medium of the epidemic, but human behavior and response to the crisis. SAINT GOBAIN: I believe there would be a greater emphasis on safe and sustainable solutions post-crisis including one on reduction of our carbon footprint. A growing number of countries are announcing target dates for net-zero carbon emissions. Going forward, I believe industries will find a way to operate in a more environmentally sensitive manner given the implications. AC: Will you be able to increase your presence in new burgeoning markets as companies worldwide are forced to remain closed for longer, will this give you an advantage? SAINT GOBAIN: We are always looking to position ourselves in fast-growing markets worldwide through our innovation and global presence, pre- and post-crisis. CHINA GLAZE: It's hard to say. The epidemic situation in various regions of Asia is not calm, but in the long run, this is indeed an opportunity for other companies interested in expanding. Market players may reshuffle the cards. Under the epidemic, China Glaze has adopted a more conservative strategy under this epidemic, slowed down its pace, adjusted the group's resources and continued to invest in research and development. We are ready and look forward to being the first to break the starting line after the market re-opens. AC: Finally, if you could give one message to the Ceramics industry at this very difficult time, what would it be? CHINA GLAZE: China Glaze has been established for nearly half a century. We grown up with our customers hand in hand, and worked hard to overcome every difficulty; I hope that every member of this industry can display the spirit of sportsmanship, cooperate with each other, and face challenges once again to the world, show the light of human nature and build a better future for our next generation. SAINT GOBAIN: I wish our fellow members in the Ceramics Industry the very best during this difficult time – for some, survival is the most important thing on their mind. I believe the industry will rebound as the economy does. Saint Gobain recently announced our purpose, “Making the world a better home”. Sustainability of our people and planet is at the core of this purpose statement. We invite you to explore this at our website (https://www.ceramicsrefractories.saint-gobain.com).

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asian ceramics

Neighbouring

India’s ceramic estate and construction industry in India, showed a recent study manufacturing powerhouse by industry body ASSOCHAM (The Associated Chambers of of Gujarat, state of Maharashtra is the largest market for ceramic Commerce & Industry of India). According to the study, there are tiles and sanitary ware producers in India. Though, the state’s about 3,489 projects worth INR 18500 billion in the construction and real estate sectors that are currently ongoing in the country. population accounts for about 10 % of India’s population, but Real Estate developments in the top four cities; Mumbai, Pune, it consumes nearly 18 % of country’s ceramic tile and 16 % of Nashik and Nagpur are the sanitary ware the key contributors consumed in the Ceramic tile manufacturing statistics from state of Maharashtra to the ceramic country. Current 2014 2015 2016 2017 2018 demand in the state. construction trends Ceramic tile installed capacity The Government's 20.1 20.1 23.7 23.7 23.7 show that this (m. sq metres) focus remains on proportion is going to Actual production 14.3 13.9 16.0 16.1 15.8 developing a worldmove upwards in the Overall Capacity utilisation 71% 69% 68% 68% 67% class infrastructure in coming years. the state to support Number of producing units 7 7 6 6 6 the rising demand and Maharashtra is the make Maharashtra's richest state in the presence felt on the country and second Ceramic tile and sanitary ware consumption in Maharashtra world map. New most populated with 2014 2015 2016 2017 2018 initiatives taken by a population of nearly 115 million. It is the Ceramic tile consumption 163.3 174.7 183.6 194.0 197.1 the government to upgrade infrastructure third-most urbanised (m. sq metres) in the state is expected state with an urban Percentage of India’s tile 17.1% 17.1% 17.2% 17.9% 18.2% to boost ceramic population of 45% of consumption consumption in the the whole population. Ceramic tile consumption growth 9.1% 3.80% 5.09% 5.66% 1.59% state. Mumbai, the capital over previous year Construction is of Maharashtra Ceramic sanitary ware 5.90 6.21 6.46 6.59 6.72 the backbone of the is considered the consumption (m. pieces) economy of any state/ financial capital of country. To uplift India. Mumbai region Percentage of India’s sanitary 18.3% 18.9% 18.3% 17.9% 18.4% ware consumption Maharashtra's profile, ( including Mumbai, the Government has Greater Mumbai and Sanitary ware consumption 6.77% 5.24% 4.02% 2.01% 2.0% implemented new Thane) accounts for growth in the state over previous a major proportion year industrial policy, of ceramic tiles and facilitiated ease of sanitary ware consumption in the state. doing business, etc. which in turn will increase the construction activities in the state, leading to higher consumption of ceramic A number of factors make state of Maharashtra country’s products in the coming years. Construction sector contributed largest ceramic market. Maharashtra is the third most urbanized nearly INR 1.29 lakh crore to Maharashtra's GSDP during the year state among major states in the India. Two districts- Mumbai 2019-20, clocking a CAGR of ~6% from INR 806 hundred crores and Mumbai (suburban) have 100% of their population in urban in 2011-12. Areas. The population of Greater Mumbai Urban Agglomeration Despite the huge consumption of ceramic tiles and sanitary (UA) is 18.41 million, which is the largest Urban Agglomeration ware state of Maharashtra has failed to attract ceramic tile and (UA) in the country in terms of population. Maharashtra accounts sanitary ware manufacturers. Currently, H& R Johnson and Nitco for nearly 25 per cent of the total investments attracted by the real and four other small ceramic tile manufacturers are engaged in

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M a h a ra sht ra ceramic tile production in the state. Though the state doesn’t have large presence of ceramic manufacturers, but it acts as a hub of Indian ceramic industry as a number of ceramic tile and sanitary ware producers have their registered/ commercial offices in Mumbai. Well-developed ports in the state and excellent road infrastructure has also enabled Gujarat based ceramic tiles and sanitary ware producers to meet the ceramic demand of the Southern states of the country. Raw materials The State of Maharashtra is well endowed with a number of raw materials for ceramic industry. State has resources of china clay in Amravati, Bhandara, Chandrapur, Nagpur, Sindhudurg and Thane districts; chromite in Bhandara, Chandrapur, Nagpur and Sindhudurg districts; dolomite in Chandrapur, Nagpur and Yavatmal districts; fireclay in Amravati, Chandrapur, Nagpur and Ratnagiri districts; kyanite in Bhandara and Nagpur districts; laterite in Kolhapur district; pyrophyllite and sillimanite in Bhandara district; quartz and silica sand in Bhandara, Gadchiroli, Gondia, Kolhapur, Nagpur, Ratnagiri and Sindhudurg districts and quartzite in Gondia and Nagpur districts.

H & R Johnson

Second largest producer by installed capacity in India, H R Johnson operates a total of six ceramic tile production plants in the country. Company’s Mahrashtra based manufacturing plant is located at Pen in district Raigad. The company has an installed capacity of 68 million square meters per annum across 13 manufacturing plants (including those under subsidiaries and joint ventures). In a recent interaction with AC, company’s outgoing CEO, Joydeep Mukerjee told, “ Though all our manufacturing plants are state of the art production centres, but, our manufacturing plant at Pen in Maharashtra holds a special place. The laboratory located at this plant was the first to get recognition by the Department of Industrial and Scientific Research in the field of ceramic engineering.”

NITCO Limited

NITCO (Northern India Tiles Corporation) Limited is among one of the oldest ceramic tile manufacturing company in India. Established in 1966, company’s manufacturing facility is located at district Raigad in the state of Mahrashtra. The company provides floor and wall solutions with a portfolio comprising a comprehensive range of tiles, marbles and mosaic.

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Industry: gasping for air? As AC goes to press, oxygen supplies required by industry should be getting “back to normal”, said Industry Minister of Maharashtra, Subhash Desai in a media statement. An online meeting with oxygen suppliers and entrepreneurs was held under the chairmanship of the Minister. A detailed discussion was held on the oxygen shortage experienced by the industry. Oxygen is an important ingredient in processing and manufacturing industries. MIDC CEO P Anbalgan, Industry Development Commissioner Harshdeep Kamble and Gas Association President Saket Tiku were also present. A month ago, the state government had issued an order to reserve 80 per cent oxygen production for Covid patients. This has caused a huge shortage of oxygen to the industry. Even so, the pandemic condition has been improving over the course of the month. Keeping the Health department requirements in mind, the supply to the industries will also be improved, Desai said. The state is currently producing 1,000 metric tons of oxygen, but production capacity is 1,300 metric tons. Therefore, the suppliers should try to fill the gap of oxygen shortage for industrial use. However, at the moment, priority will remain for patient treatment, he said.

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Flying high

Aerospace ceramic carbon fibre in South Korea AC looks at how the Peninsula's aerospace industry is looking to boom...

outh Korea is a rapidly growing market for domestic consumption and sourcing of aerospace parts and components made of carbon and carbon ceramic fibres and composites. As a manufacturing base of aerospace industry, the market is already crowded with over a hundred manufacturers-suppliers of different products with annual orders of some US$5-6 billion. Over half a dozen carbon fibre manufacturers are also well active in the market. To meet the increasing demand of carbon fibres, the companies are expanding their production capacity, competing against the regional rivals of Japan and China. According to industry sources, carbon composites are the foundation material for the next generation core industries around the world and they are widely regarded as core materials for the next 100 years. Among these materials, ultra-high temperature carbon composites are the only materials that can be used for structural purposes at temperatures over 3,000℃ and are one of the key materials that open the space age of mankind.  Carbon and carbon ceramic composites are composite materials reinforced with high strength carbon fiber and have high purity, light weight, and excellent heat resistance at high temperatures. The carbon materials are used in the general industrial manufacturing as well as high technology fields. The application range is rapidly expanding and are used widely in aerospace, energy, semiconductor, powerplant, building materials and others. South Korean applications of the products are in interior and exterior of aircrafts, ceramic brake discs, elevator brake shoe, carbon mold, carbon plate, carbon structure, carbon bolt/nut, etc. Its properties include high strength and toughness, excellent heat resistance at very high temperature of over 2,000℃, and it is up to 75 percent lighter than metallic materials. Main customers of the products are the South Korean manufacturing companies, Hyundai Elevator, Cronite Mancelle (Safe), Technologie Alto Vuoto (T.A.V.), Hanwha and others. Leading manufacturer DACC Carbon Ltd developed carbon brake discs are currently in high demand and are in operation of many aircraft fleets of its customers, such as, Defense Acquisition Program Administration

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(Republic of Korea Air Force), Greece Air Force, Indonesia Air Force, etc. Besides domestic demand, a substantial part of the carbon fibre and composite materials and the products made of such advanced ceramic materials are sourced by the aircraft producers from different countries, including those of Europe and North America, and they include almost all major commercial, civil and military aircraft manufacturers, including Boeing Company and Airbus. Korea Aerospace Industries Association (KAIA) is highly optimistic about the present continued growth of the country’s aerospace product manufacturing. Based on the "Basic Plan for the Development of Aircraft Industry," the blueprint which aims to place South Korea among the top 7 global position by 2020, the existing projects will follow the growth pattern and new projects will be launched smoothly. If these projects are successful, Korea's goal of "producing 20 billion US dollars and exporting 10 billion US dollars of products to enter the Global 7 tier in aerospace industry by 2020" will soon be reached. However, a 30 percent decrease in civil aerospace market expected due to COVID-19 is reflected in 2020 market size estimates. Carbon fibre producer, Hyosung Advanced Materials Corporation, is going ahead with gradual increase of carbon fibre to become one of the leading players in Asia. The company’s manufacturing plant, located in Jeonju, is expanding its annual carbon fibre production capacity to 24,000 tons in 2028, from 2,000 tons in 2013 and 4,000 tons in 2020. Hyosung will target the aerospace market by producing intermediate modulus and ultra-high strength carbon fibres developed for next-generation primary and secondary aerospace structures. “The aerospace community and our industrial customers have wanted to see Hyosung carbon fibre capacity increased and this expansion will support their growth,” said Kwang Seok (Kenny) Han, Vice President of Carbon Fibre Division of Hyosung. “Our customers have also requested the production of unsized carbon fibres which we have introduced to support their efforts in high temperature thermoplastic applications for aerospace and oil and gas.” By 2028, Hyosung will invest a total of 1 trillion Korean won or more than US$835 million in carbon fibre

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expansion. The company plans to increase its production lines to 10 in 2028, from 2 in 2020. Hyosung says that the added capacity will bring its market share in carbon fibre up from 2 percent to 10 percent, making it the third highest producer of carbon fibres globally. Overview of South Korean aerospace production and trade (1) 2017

2018

2019

2020 (Est.)

Total Market Size

5,436

6,732

8,487

9,223

Total Local Production

3,969

4,714

6,028

6,298

Total Exports

2,086

2,617

2,822

2,646

Total Imports

3,553

4,635

5,281

5,571

Source: Korea Aerospace Industries Association (KAIA). Unit: USD Million.  Note: A 30% decrease in civil aerospace market expected due to COVID-19 is reflected in 2020 market size estimates.

Commercialization

Meanwhile, Korea Institute of Carbon Convergence Technology (KCTECH) signed a business agreement with Arkema, a multinational company headquartered in France, to improve the level of carbon composite technology and explore overseas markets. Jeonju based KCTECH has also signed a memorandum of understanding recently with DACC Carbon, currently the leading player in production of carbon composites for the South Korean aerospace industry, for joint research and development of ultra-high temperature ceramic fibers and composite materials to commercialize ceramic matrix composites (CMCs). CMCs consist of ceramic fibers embedded in a ceramic matrix. CMC materials overcome the major disadvantages of conventional technical ceramics, such as, brittle failure and low fracture toughness, and limited thermal shock resistance. Their applications are in fields requiring reliability at high-temperatures and resistance to corrosion and wear. DACC Carbon claims that it is the only company in Korea that is in the field of ultra-high temperature carbon composites since over last three decades. “All of our employees have been stubbornly and enthusiastically devoted to the localization of Korea’s defense industry products. As a result, we have developed and massproduced carbon brake discs for fighter jets, ultrahigh temperature heat resistant materials and are also exporting carbon brakes overseas,” said Kwang-Soo Kim, CEO of DACC Carbon.  “Based on these technologies, we have completed the development of carbon-ceramic brake discs for premium automobiles. We are now preparing to enter the market for the second time in the world and are preparing for the future. In the general industrial material market, we are exporting many products to the world to meet the needs of the customers.” DACC Carbon, with factory located at Unam-ro, Deokjin-gu, Jeonju in Jeonbuk province, is South Korea’s leading carbon ceramic composite manufacturer. It developed the product and manufactures since about last four decades. Particularly, since mid-2000s, it is almost the exclusive manufacturer of aircraft composite structures in South Korea. It has designed, developed

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and manufactured a wide assortment of products. Its C/Sic composite manufacturing method includes liquid melt infiltration or reaction bonded sintering and chemical vapor deposition. DACC Carbon’s major business areas are ultra-high temperature carbon-carbon composites and carbonceramic composites that can be used up to 3,000℃. “We are a company specialized in ultra-high temperature carbon composites and provide a one-stop solution from material development to process design, structural analysis and production of end-products,” said DACC Carbon chief Kim. KCTECH and Arkema also agreed to support cooperative research and technical development of carbon composites along with projects and programs for the development of new technologies. They also agreed to proceed with training, education, and consultation related to the carbon composite industry and establish a cooperative system including the exchange of researchers between France and Korea. Among other activities, Arkema manufactures automotive interior and exterior materials and lightweight materials, resins for thermoplastic composite, home appliance display and exterior materials. It has the business places in Jinhae and Haman in Gyeongsangnam-do and Gunsan in South Korea. KCTECH, located in the metropolitan city of Gwangju, under the central government, is the only governmentfunded research institute for carbon fibre materials and carbon fibre-reinforced polymer (CFRP) in Korea. KCTECH promotes machinery and automobile manufacturing sectors, carbon composite industry and parts materials industry, which seems to be one of key industries, as the strategic industries of Korea. KCTECH promises to play a pivotal role to promote the local economy by attracting qualified business on the basis of new technology development, national R&D projects and leading the troublesome technology of small/medium business.

Aircraft structures

Korea Institute of Ceramic Engineering & Technology (KICET) and Korea Aerospace Industries Ltd (KAI) are working together in improving the application of carbon fibre and performance of aircraft, with mutual cooperation on the application of carbon fibre and functional ceramic coating technology and hybrid material technology. KICET is operating a ceramic fiber practical center for its research that is applicable to aerospace and machinery, which are the main industries of Gyeongnam province. Also, KICET is establishing a new growth engine industry for the future through a ceramic fiber composite base for a transportation system applicable to aircraft. It assists in establishment of manufacturing facilities and other infrastructures, which are difficult for individual companies to acquire, to facilitate the practical use of high-functioning ceramic fiber. Its services include development of core technology and mass production technology to produce competitive goods in terms of technology and price, thereby strengthening core R&D capacity and business supporting platforms. It provides provision of optimization solutions for mass production of ceramic materials and components suited

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for extreme environments, also provides establishment of business support system to assist companies in product manufacturing, talent cultivation and marketing based on the existing infrastructure for nurturing of businesses specializing in ceramic fibers. Hankuk Carbon Co Ltd, located in Chunwha-ro, Bubuk-myeon, Miryang-si, Gyeongnam-do, has developed many types of prepreg in carbon ceramic aerospace materials/parts. Its prepreg contributed to the Category

Aircraft Space parts Total

2018 Export Whole platform Parts/ Components

Import

industry of aircraft manufacturing domestically and to other aerospace parts and component manufacturers in South Korea and to the export markets. Korea Aerospace Industries Ltd (KAI), with two plants located in Sancheong and Jongpo of Gyeongsangnamdo province, is manufacturer of complete aircraft system, airframe, upgrade and modification and user of parts and components of carbon ceramic composite materials for its aircrafts. 2019 Export

Import

2020 (est.) Export

Import

630

2,155

499

2,810

476

2,963

2,317

2,263

2,421

2,268

2,567

2,392

208

203

214

2,300

3,155

2,890

5,281

3,065

5,569

Source: Korea Aerospace Industries Association (KAIA). Unit: USD Million. Note: Korean Air, one of the largest commercial airliners in Korea, and Korea Aerospace Industries Ltd (KAI) are also the leading companies which make and assemble parts for Boeing and Airbus.

DACC Carbon Co Ltd Location: Unam-ro, Deokjin-gu, Jeonju, Jeonbuk province, South Korea 54853. Products: carbon, carbon fibre, carbon ceramic composites, and ceramic brake disks for aerospace industry. Markets: Domestic and export markets. Others: DACC Carbon is South Korea’s largest and one of the leading manufacturers of aircraft composite structures in Asia. Its brake discs are in operation is different defense air forces, air services and aerospace industries, and they include South Korea’s Defense Acquisition Programme Administration, Korea Air Force, Agency for Defense Development, Korea Aerospace Industries Ltd (KAI), Korea Aerospace Research Institute (KARI), Doowon, Hyundai, Hanwha, and air forces of Indonesia, Thailand and Greece. Hankuk Carbon Co Ltd Location: Chunwha-ro, Bubuk-myeon, Miryang-si, Gyeongnam-do, South Korea. Products: Carbon fibre, UAV, and carbon ceramic prepreg for aerospace industry. Markets: Domestic and export markets. Others: Hankuk Carbon Co Ltd has developed many types of prepreg in carbon ceramic aerospace materials/parts. Its prepreg contributed to the industry of aircraft manufacturing domestically and to other aerospace parts and component manufacturers in South Korea and to the export markets. Hyosung Advanced Materials Corporation

Location: Jeonju, North Jeolla (Jeonbuk) province, South Korea. Products: Carbon fibre. Markets: Domestic and export markets. Others: Hyosung Advanced Materials plans to expand its annual production capacity of carbon fibres from 2,000 tons in 2013 to 4,000 tons in 2020 to 24,000 tons in 2028. Carbon fiber is used as structural materials and interior materials for aircrafts.

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Korea Aerospace Industries Ltd (KAI) Location: 2 plants in Sancheong and Jongpo in Gyeongsangnam-do, South Korea. Products: Complete aircraft system, airframe, upgrade and modification Markets: Domestic and export markets. Others: KAI processes composite materials for use in its manufactured defense and civil aircrafts, such as, trainer planes, armed helicopters and satellites. It is a manufacturer of full aircraft system and user of parts and components of carbon ceramic composites for its aircrafts.

Korea Institute of Ceramic Engineering and Technology (KICET)

Location: Soho-ro, Jinju-si, Gyeongsangnam-do, South Korea. Products developed: Ceramic research outputs in advanced and traditional ceramics. Applications and markets: Ceramic technology for domestic industries and exports. Others: The state run KICET develops products and manufacturing processes and technology for application in manufacturing of advanced and traditional ceramics. Provides various support services including testing and analysis and manpower training.

Korea Aerospace Technology Research Association (KATRA)

Location: Daeheung-ro, Mapo-gu, Seoul, South Korea. Products developed: Carbon ceramic aerospace parts and technology. Applications and markets: Domestic member industries/ organisations and exported. Others: KATRA, founded by an Act, promotes aerospace parts/component technology development business, manages aerospace parts projects, performance R&D and management research, maximizes synergy effect through cooperative research, and provides testing and training for members.

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Insight

RUSSIA Table 1

Table 1 2016 2017 2018 2019

2016 2017 2018 2019

1185850 1246733 1388815 1532418

Total sanitaryware imports (no. items)

Total sanitaryware exports (no. items)

Table 1

Table 1 Azerbaijan Armenia Kazakhstan Kyrgyzstan Tajikistan Uzbekistan

1732535 1895307 2048963 2271043

Belarus Czech Rep Georgia Germany Italy Ukraine UK

60,847 104,535 838,659 123,597 57934 199,763

Sanitaryware exports to ex-Federation (no. items)

245,894 18,290 95,701 85,378 4,615 85,216 2,208

Sanitaryware exports to Europe (no. items)

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Table 1

Table 1 Azerbaijan Armernia Belarus Kazakhstan Kyrgyzstan Latvia Uzbekistan Germany

Azerbaijan Armernia Belarus Kazakhstan Kyrgyzstan Latvia Uzbekistan Germany Azerbaijan

520,962 246,488 1,671,916 5,008,960 999,035 399,292 299,385 1,209,380

Leading tile export destinations (sq metres)

520,962 246,488 1,671,916 5,008,960 999,035 399,292 299,385 1,209,380 520,962

Leading tile import sources (sq metres)

Table 1 China Italy Turkey Egypt Spain Vietnam Czech Rep Poland

524,904 146529 111453 71894 39003 69972 42489 69681

Table 1 2016 2017 2018 2019

Leading sanitaryware import sources (no. items)

303,174 401,440 547,044 524,904

Sanitaryware imports from China (no. items)

Table 1 2016 2017 2018 2019

Table 1

858,841 910,827 954,320 838,659

2016 2017 2018 2019

Sanitaryware exports to Kazakhstan (no. items)

Spain

249,038 11814559 12,093,689 12,418,175

Italy

877,282 6230844 8,170,803 8,775,900

Tile imports from Spain and Italy (sq metres) Spain

Italy

1 1

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Hunter and the hunted

o t t f e l g n i h t y n a e b t ’ n o w e r e h “t s sa ve soon" t h g u tho I Don’t Much Like the New Normal, Let’s Make a New One. l’ or questions such as ‘What will be We’ve been hearing phrases like ‘This is the New Norma ves and made a new normal that oursel this the New Normal?’ Maybe it’s time we took control of benefits us. n rates and deaths from COVID 19 as It is quite a few weeks now since I last checked the infectio days ago, watching the news I was few A it had become a morbid obsession and it was depressing. now 27,570,740). There have is (it cases ,000 20,000 over ne, advised we had reached a milesto tandable – even if scientists unders is which yet e been also 996,236 deaths. We don’t have a vaccin it doesn’t have side road the down that sure make to tested be to has it develop a potential one xxer crowd). We anti-va the to that ing explain (try e diseas effects that are as bad or worse than the and not well istent incons is tracing but ing aren’t approaching herd immunity either, testing is improv istent and incons been have ments govern s variou from se respon developed; communication and don’t take it seriously enough or they break contradictory – it is hardly surprising that some people rules. cing distan social , various lockdown, masks news daily if not hourly on many channels is Information about the virus which of course is headline and research into it is ongoing whenever virus new a equally confused and contradictory. Given it is dumbed down or its relevance not explained some new finding is reported it is often misrepresented, up to The Lancet so that I could read some signed I ago s month adequately. That’s no surprise, a few sly, my knowledge of biology never Obviou of the research work being done on the new coronavirus. the scientific papers though tand unders to h enoug deep or broad mind virology is nowhere near points. Unfortunately, a news ant import the tand unders fortunately, they have summaries so you can es the nuanc of each revelation and what programme or papers can rarely afford the time to explain Sometimes it seems the intention is to public. l genera the es results is a confusing noise which bemus m. platfor create fear or outrage or to give conspiracy theories a and ‘U turning’ every week or so gives aims their suit to story any g spinnin help Politicians don’t g or going. Further to this, restrictions, comin are they er wheth the impression that they don’t know l. Using Hong Kong as an example, illogica r appea whether the severity or extent of them occasionally virus has a lie in bed until then and only restaurants are shutting at 6 pm so we assume that the under one roof can’t sit together in a lives that family a becomes active in the evening. Likewise, queue up in a supermarket and have jingles restaurant where a two per table rule applies. You can a bar even if there is only two to a table. in play band a to listen played as you wait but you can’t children are playing together in car parks the so Greater idiocy – children’s playgrounds taped off – UK and EU and people are going on the at over look I safer. sly obviou is and bus stations which ment issues new rules on quarantine. govern a se becau holidays but then having to rush home early 6 than people because – I don’t know… Now the government is restricting gatherings to no more ?  Looking at America – well I just shake people 6 the e chang you which 6 people and how often can that would do anything for the country – s citizen my head in disbelief. People who claim to be proud m! The President is forced to admit he freedo – se? Becau to. asked when can’t even wear a mask caught on tape saying he knew how been he’s as March in downplayed the severity of the virus back to protect Wall Street…and that likely – more deadly it is but wanted to downplay it – to avoid panic hasn’t worked out anyway.  mies are growing desperate to open up. In Asia, India is now worst hit by the virus but many econo it or not people are becoming desperate. To a certain extent and whether governments acknowledge months but it is now September and three or two for ling strugg to ed I think many of us were resign don’t seem to be improving or even changing more rather than fewer restrictions are in place. Things 2021, Malaysia won’t allow anyone in, Hong much. Australia says it won’t allow people to leave until self-quarantine even if you test negative. days 14 do to have Kong will allow only residents in but you Thailand something similar.

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

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Hunter and the hunted

es and reversals are doing more harm One thing that is becoming obvious is the continual chang ulous response to (another) ‘flu-like’ incred the ing than good. I can well understand in the beginn from the WHO until mid to late January illness coming from China especially as the message ’s own pronouncements. I can also China per as le unicab was that it was OK as it wasn’t comm in Italy, France and Spain then people as sympathise when a few weeks later the panic set in ones. Outbreaks that swamped loved their from d isolate deaths terrible became very ill and died ' actions swung from those that ments govern s variou each nation’s healthcare systems. Then the their economy open but keep to who tried put in place strict restrictions & lockdowns to others forthright response  At a more a ing requir es fataliti and rates on then were faced with rising infecti China that the Wuhan in family the from g personal level, back in mid-January whilst I was hearin were reporting and e outsid go to scared were hai Shang in people outbreak was severe and ng with people debati was I up’ d ‘locke be could they people with Hubei accents to the police so mask if you a wore you usly that previo how futile or not it was to wear a mask outdoors, given we were asked ly, Equal dust. t agains tion protec r barrie of form were a surgeon or needed some and supplies were low. Don’t get me started not to hoard masks as healthcare staff needed them es. potato and rice paper, on the panic buying of toilet contradictory information often biased We were ignorant and we were being presented with it was not tailored to differing economic as ing by politics. Mixed messaging made more confus did not and does not help we live in an It . levels tion educa and s round realities or social backg or traditional news sources but we will ments govern our era where many of us don’t trust either iracy theory we saw on Facebook. Yes believe some guy with a YouTube channel or some consp education to get the true picture from the have us of few and work – reading The Lancet is hard about how evil Bill Gates is and then video ute such specialised resources but watching a 15-min Idiocy. ic? rhetor mic pande believing in planned

Economic woes.

we going to risk crashing the economy Nevertheless, we are now faced with a decision – are ies have economically been hit worse countr totally or are we going to try to plot a way out? Some and beverage, retail, tourism as food have; my econo the of nts segme than others just as some well – Sri Lanka or Bangladesh but ingly surpris nding examples. Some countries seem to be rebou left to save soon’ lamented a friend with a others like Thailand struggle. There won’t be anything and hotels are closed and the people shops many dead, is ceramic supplies company, ‘the place e? When will they be able to buy surviv they laid off aren’t earning any money – so how long can things again?’ – how long can we survive like this? Fair comment. At an individual, local and national level back to work because of either fear of go won’t Another businessman in the UK says that people are with questions still being asked about getting ill or lack of motivation – or concerns about childc six but your children can go back to than more group a back to school rules; you can’t meet in his international business running smoothly classrooms and mingle? He also is struggling to get and there is only so much that can be done ers custom meet or as he can’t travel to see his team that whilst I’m not the biggest fan – though f in a Zoom meeting or a telecon. I’ve realised mysel y. It is also likely that I won’t be able to quickl very people of lot a see to way exhibitions are a great to travel and quarantine restrictions. due ahead goes it if attend Vietnam ceramics for example – normal interactions that help to build the We are missing the exchanges of information and ideas, . insane going from our business and even keep us of news telling us things might be getting So, what can be done? Every day we get one piece are going off and the situation getting better but then another telling us not to relax as alarms now and it’s time to make a decision. We oads crossr a at are we see worse. Well from what I can quarter one of 2020. There are now in back did we now understand the virus much better than exactly cures. There are treatment regimens some medicines that help with recovery if they aren’t days are not needed so much. It can be early the from es that can help patients and some practic know many people are asymptomatic also a horrific disease and some people will die still but we it is still more of a concern for ill get people young some gh   Thou or get off relatively lightly. CONTINUED ON NEXT PAGE

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

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medical conditions. So I’d suggest that older people and those suffering serious pre-existing the crisis differently than one with a higher countries with a younger demographic need to handle at the predictions that commentators back look I if is thing ther . Ano percentage of older people suggested that the virus would many March or ary were making about Covid-19 back in Febru n. Industries would recover Autum in the fade away ‘in the hot weather’ and probably come back n. seaso flu next the for well somewhat and have to prepare for execrable attack on health and the But that never happened – the virus has imposed an e yet it is time we learned to live with economy – given we aren’t going to be getting a vaccin we have not avoided it nor have we tions excep few very With it. this epidemic – not try to avoid d mess whilst some countries have rdinate uncoo managed the situation well. At best it’s been an g to new information or pressure reactin – on directi little been has there – done better than others le – the number of cases. At examp An ctive. destru been from various media or political bias has were, were often people that those and the beginning of this epidemic few people were tested people can be tested so more Now y. anywa kits test h enoug ’t showing symptoms, there weren are positive because we people young more that we get more positive results and we are finding ill or die – we know sly seriou to get ill, are testing them – but that doesn’t mean they are going are the vagaries of there Then oms. sympt mild get or c now that many people are asymptomati have been tested people million 1.1 m. testing. Hong Kong launched a Community Testing progra so we could say that maybe there found, were cases new Five . out of a population of 7 million Saturday the Centre for Health Protection are only 35 cases throughout the population. Yet last ity, is it really because of ‘imported’ cases? dispar the Why day. one on cases announced 21 new and create a more liveable ‘normal’ I So, to cut to the chase and to try to save the economy to open up even if countries still tightly have mies would suggest the following.  National econo There isn’t much point opening up control their borders. Even if there are infection hot spots. trying a different often piecemeal sets or again down g lockin some areas for a week or two, then one consistent thing is that people world the of restrictions; it is hard to take seriously and all over follow the rules themselves or don’t who people by do to what told are getting fed up with being simply don’t have any credibility left. going around in circles on that one. But Secondly – mandate the use of masks and let’s stop it’ll be best if you self-isolate as sicker or older are you if ; people with t also, be bluntly hones do get infected and very sick there you if that stand under much as possible. For everyone else – an ICU bed. Let people make mind never is no guarantee you will be able to get hospital care way and then another way, one people ng lecturi se becau risks their own choices and take their and then yet another way just hasn’t worked. business to open up regional bubbles If this goes well enough then it will be important for the people travel between them – let – well ing manag are Lanka Sri – if Taiwan, Vietnam and Let countries make ‘bubble’ mies. econo the it’ll generate business, tourism and invigorate are temporary spikes in infections, there if even it to stick and tracing and g trackin agreements on infection rates.  Finally, we need the of flow and ebb the with don’t backtrack either – learn to live the hands of the people; the into back s’ to get money tied up in hedge funds and offshore ‘haven a few rich people save have not – money ing spend out be to need s working and middle classe time.  next for about think and invest it.  But that’s a bigger problem I’ll Until then, I remain… William Hunter

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

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