Asian Ceramics AC18-4

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AC18-4

OFFICIAL MAGAZINE:

CERAMICS CHINA G UANG Z HOU

IN FOCUS: Tile buying trends p1 Cost reduction in heavy clay Focus: Fujian Province The Iranian tile sector Plus news, views, analysis and much more!


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News

Contents: AC 18-4 News

Features

6 Inside Asia

24 Iranian tiles

Pakistan turns a corner?

8 Welcome

Improving quality control.

Yogender Malik looks at how the boom in Iran’s tile industry has continued to defy logic and with ambitious targets laid out by the Ministry of Trade, the momentum shows no signs of slowing…

10 Across The Continent

32 Heavy clay cost control

Openings, closures and industry moves from across Asia.

Our eye on the international arena.

Rohan Gunasekera looks at how South Asia’s heavy clay industry has been forced into a world of environmental efficiency and cost control at a time when economies are driving margins ever slimmer…

20 Material Matters

38 Tile buying trends

18 International News Raw materials news and views.

22 Comment & Analysis HSIL sets a new green standard.

AC looks at how the expanding range of tile options from new entrants and established players in the Middle East ceramics industry has led to increasing price competition in certain sectors…

46 Province Profile: Fujian

In the next of our exclusive Chinese Province Profiles, we turn our attention to Fujian – a region that has rationalized its position in traditional tile making, avoided the growth of major, dominant brands and expanded its presence in the growing rustic tile market.

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Analysis 60 Talking Shop Asian Ceramics talks to Mr Prafulla Gattani, CEO of rising star, Oman Porcelain about the company’s plans and ambitions now that it has firmly established itself as an innovation leader within the increasingly competitive Middle East market.

64 Insight

Analysis and insight into China.

70 The Hunter And The Hunted

William Hunter pulls the lever on the financial one-arm bandit, and looks at the role of virtual currency in the ceramics industry…

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Inside Asia PAKISTAN: TURNING A CORNER? Despite many years of economic and import pressure, the Pakistani ceramic industry seems be more than weathering the storm, and with a series of announcements in the last few months, is looking like an industry in renaissance. Quality certification, a drive to “buy local� and restrictive tariffs on imports appear to supporting a climb in fortunes and despite the potential threats the Chinese involvement in port development may bring, there is more optimism thoughout the sector.



Welcome

R

ecently, Centro Ceramico, a highly reputable, and one of the biggest tile testing laboratories in the world, certified Pakistan’s ‘Stile porcelain tiles’ for meeting European/ International Quality Standards.

“Stile is fully committed to manufacturing the highest quality tiles locally and encourage the architects to use and promote ‘made in Pakistan’ products as these compete head-to-head with the foreign made tiles in terms of quality,” said Shabbir Tiles (Stile) CEO Masood Jaffery.

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AC18-4

CONTACT DETAILS EDITORIAL

OFFICIAL MAGAZI NE:

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

C E R A M IC S C H IN A

G UA NG Z HO U

ADVERTISING AND DESIGN

IN FOCUS:

Tile buying trends p1 Cost reduction in heav y clay Focus: Fujian Province The Iranian tile secto r Plus news, views, analy sis and much

more!

AC COVERS.indd 2

“This certification validates that Stile is manufacturing the highest international quality tiles which are at par in quality with that of top tile manufacturers from Italy and other European countries,” said the CEO.

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

14/05/2018 09:08

He said that Stile is one of the oldest tiles manufacturing companies operating in Pakistan and has always pioneered introducing the latest technology and tile features in the Pakistani tile industry with an investment of billions of rupees in research and production plant. He said that Stile recently introduced the surface finish tiles with the quality that matches international standards for the first time in Pakistan. “These durable scratch resistant tiles are an ideal fit for the Pakistani market with rough and hard surface than ordinary porcelain matt surface that is more resistant to slip in wet and dry conditions than any other tile. These tiles are also resistant to household chemicals and stains due to the extra thick glass coating, bringing the maintenance cost down,” he added. Centro Ceramico’s representative, Paolo Malavasi said that Centro Ceramico is a research and experimentation centre for the ceramics industry in Bologna, Italy working since 1976. “In Centro Ceramico laboratories, analyses and tests are carried out to meet different customer needs and issues concerning the different steps of the production cycle of ceramic tiles,” he added. He said that Stile Porcelain tiles passed the tests for water absorption, which should be less than 0.5 per cent, ensuring that the product is true porcelain and will resist any stain; strength: which confirms that tiles meet the required strength as per the standards; resistance to surface abrasion: means tiles’ surface is hard enough to sustain scratches and can be used at a high traffic areas; and slipperiness: which showed tiles are highly slip-resistant in wet and dry conditions. “With various international certifications for the production of world-class ceramic products, Pakistan is geared to become the regional hub in tile manufacturing,” said Paolo Malavasi. Of course, with India on its doorstep, Iran to the south and the growing production bases of the wider Middle East holding court, it’s difficult to see Pakistan making a rapid impact. However, as they say, every journey starts with the smallest step…let’s hope for once that Pakistan’s pressured ceramics sector will finally have a reason to look forward. Happy reading!

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

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

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

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

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Shares rise as manufacturers see improved markets • Scientifica trail-blazes with Xaar • KPPI to probe tile impor profile • Royal Ceramic Group keeps pace with expansion • Soaring tariffs provide boon to domestic manufacture favour ceramics industry • Manufacturers urged to go “niche”... BANGLADESH

Shares rise as manufacturers see improved markets Listed ceramic companies in Bangladesh saw higher growth in profit last year owing to an increase in demand from the real estate sector and export markets. Five companies are listed on the Dhaka Stock Exchange. Of them, three posted more than 150 percent growth in profit in 2017 from a year earlier. Monno Ceramic's profit grew a staggering 676.38 percent to Tk 4.27 crore, while Standard Ceramic's profit rose 209.24 percent to Tk 1.17 crore. Shinepukur Ceramics's profit went up 188.86 percent to Tk 3.82 crore and RAK Ceramics' 11.17 percent to Tk 101.86 crore, the highest among the listed ceramic makers, according to an analysis of Prime Finance and data from the DSE. Only FuWang Ceramic's profit declined -by 36.49 percent to Tk 8.07 crore. “Demand from the real estate sector as well as from abroad helped us net higher growth in

profit,” said Moynul Islam, vicechairman of Monno Ceramic. He credited Monno Ceramic's success in cutting cost for the higher growth in profit. “2017 was a much better year for the real estate sector than the previous year,” said Alamgir Shamsul Alamin, president of the Real Estate and Housing Association of Bangladesh (REHAB). If the housing sector runs well it gives a boost to the backward linkage industries. Exact data on the sales of homes, commercial space and land last year was not available. But the REHAB said the sector grew 5 to 7 percent in 2017, overcoming the downturn in the previous several years. Bangladesh's ceramic industry has experienced 200 percent growth in production in the last five years, according to the Bangladesh Ceramic Manufacturers & Exporters Association (BCMEA).

The growth momentum is expected to sustain for a considerable period as the living standard of people is rising, according to the BCMEA. The sector is not without challenges, and one of the main barriers confronting the industry is an inadequate supply of natural gas. Natural gas is not only the key energy source for the industry it is also important for maintaining the quality of products, said the industry people. The locally available gas does not contain sulphur, so the end product looks brighter and shinier, they said. The government is set to increase the gas price, which will push the sector backward in the international market, said Islam, also the senior vice-president of the BCMEA. Bangladesh's ceramic products have strong demand in the international market. “But if the price of gas goes up we will not

be able to compete with others,” he said. The sector exports to more than 50 countries, including the US, Canada, the EU, Australia, India, Nepal and Bhutan. In fiscal 2016-17, ceramic exporters fetched $39.1 million, according to the Export Promotion Bureau. The government has set a target to export ceramic products worth $43 million this fiscal year. Currently, more than 60 tiles, sanitaryware and tableware manufacturers are in operation in Bangladesh, according to the BCMEA. The ceramic industry caters to 85 percent of the demand for the Tk 2,000-crore local market. Investment in the sector by local and foreign investors has already exceeded Tk 5,000 crore. At present, the production capacity of ceramic tiles stood at 12 crore square metres per year and for sanitaryware it is 75 lakh pieces.

INDIA

Scientifica trail-blazes with Xaar The Xaar 2001+ printhead is the backbone of the ceramic tile decoration industry, and Scientifica Tiles LLP has become the first company in India to utilise its capabilities. Based in Morbi, Gujarat, Scientifica Tiles is a newly established, family-run business that manufactures high-quality glaze vitrified floor tiles for the Indian, South American, Middle East and Israeli markets. Scientifica Tiles opted for a KERAjet Eco printer with Xaar 2001+ GS12C printheads for its ability to accurately replicate natural marbles and stones, currently much in demand in the market. The manufacturer is

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benefiting from the printhead’s powerful combination of 2000 nozzles with 720dpi resolution, which together deliver fine details, smooth gradients and strong colours. “We are very excited about the creative opportunities offered by the Xaar 2001+ printheads, and the print quality we are getting is extremely high,” said Hiren Vadaviya, director, Scientifica Tiles. “Compared to other printheads that are available, a big advantage with the Xaar 2001+ is the fact it can reproduce the subtle colour gradients of marbles and stones, making it ideal for these designs.” Once the stronghold of

screen printing, the ceramic tiles factories in Morbi, have embraced the digital technology in a big way. These factories offer endless possibilities and thousands of designs as well as innovative design concepts. Therefore, the high-resolution 720dpi delivers fine detail that can capture even the smallest features, such as rock veins and grains of sand. It enables smooth gradients in areas of low ink coverage (0-10% range), allowing flawless replication of the subtle tones found in onyx, for example. In addition, due to its 2000 nozzles, the Xaar 2001+ GS12C can deliver strong colours when required, with an ink laydown of

up to 40 g/m2 at 25 m/min line speed – and with no compromise on resolution. Scientifica Tiles has also opted to utilise Xaar’s High Laydown (HL) Technology for special effects. These bars are currently being added to the machine, and will come into production by May. HL Technology enables exceptional special effects such as gloss, adhesive (glue) and metallic, with ink laydown of up to 120 g/m2 at 35 m/min line speed. There are around 600 ceramic manufacturing units with production worth Rs 4,000 crore per annum. The main products are ceramic tiles, vitrified tiles, floor tiles, glazed wall tiles, lustre wall tiles, sanitary wares, porcelain tiles, spartek tiles, glaze tile, roofing tiles and mosaic tiles.

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rt status • Somany plant on track for December • Shabbir aims to raise tile ers • China-Bangla gives green light to expansion • Gas company split to INDONESIA

KPPI to probe tile import status The Indonesian Trade Security Committee (KPPI) is investigating the influx of imported ceramic tiles, particularly from China, that has seriously affected the local industry. KPPI head Mardjoko said the investigation was opened in response to a request from the Indonesian Ceramic Tiles Industry Association (ASAKI) which complained on behalf

of domestic ceramic tiles producers about unusual influx of imported products in recent years. “From the initial evidence provided in the request submitted on Mar. 26, the KPPI has observed an influx in ceramic tiles imports. We have also seen indications that the local industry has suffered serious losses,” Mardjoko said in Jakarta in a

statement. He said the losses were indicated in the declining performance of the ceramic tiles industry from 2015 to 2017, with the stockpile of unsold products and the decline in production volume, sales and number of workers in the industry. Based on the Central Statistics Agency's (BPS) data from 2015- to 2017,

Indonesia imported 861,341 tons of ceramic tiles in 2015, 1,073,972 tons in 2016 (a 24.7 percent year-on-year increase) and 1,262,016 tons in 2017 (a 17.5 percent yoy increase). Nearly all imported ceramic tiles came from China, at 96.03 percent in 2017. Other ceramic tile exporting countries include Vietnam, Thailand and Malaysia.

INDIA

Somany plant on track for December Somany Ceramics ' first plant in south India near Tiruchirapali in Andhra Pradesh will be commissioned in December, a senior company official said. Talking to media in late April, Sanjay Kalra, chief marketing officer, Somany Ceramics, said, "This plant "will produce about 11,000 to 12,000 square"meters of verified tiles per day. It will be commissioned in December." Somany Ceramics is a

manufacturer and marketer of tiles and offers a range of sanitary ware and bath fittings. Inaugurating the company's exclusive showroom here recently in Vadodoara, Kalra said, "We produce 65 million sqm of vitrified and ceramic tiles from the three fully-owned facilities (two in Kadi, Gujarat and one in Kassar, Haryana) and six joint venture facilities at Morbi in Gujarat."

The company also has a vast distribution network comprising over 12,000 dealers and sub-dealers and 350 franchisee managed showrooms, he informed. Kalra said the company is geared to launch 100 plus franchise showrooms across the country by end of this year. "As the economy gears up for the goods and services

tax (GST), this change is a welcome one for the tiles industry by creating a seamless national market for the organised players resulting in the removal of interest rate barriers and an improvement in supply chain," he added. The company expects strong recovery in demand"with a double-digit growth in FY18 after implementation of GST and the e-way"bill.

PAKISTAN

Shabbir aims to raise tile profile With a commitment to educate the citizens of Lahore and enable them to make informed decisions about tiles selection, Shabbir Tiles & Ceramics (Stile) has expanded its network with opening of Stile emporium in Lahore. This store in Lahore is 4th emporium of Stile in the country with a plan to open more emporiums by the end of this year in different cities. “The Stile Emporium” in DHA Lahore will feature state-of-the-art display

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of high end locally produced tiles and building / installation materials. Free consultancy and designing for improving the outlay of homes will be offered so that customers can get firsthand knowledge and be more capable to understand the difference between various types of tiles and their usage. “Stile is fully committed to the country and our customers and to provide them with the highest quality locally produced tiles. To cater to increasing demand,

we have recently invested Rs 1.25 billion in our research and production plant,” said Masood Jaffery, CEO Stile. “Moreover, we want our customers to have awareness about tiles and their ideal usage so that they can have enough information at hand when making decision to purchase tiles and we will continue to open more emporiums throughout the country for this purpose,” he said adding that selection of tiles is a major

challenge due to abundance of different quality and types of tiles whereas cost-effectiveness is a major deciding factor. Stile is manufacturing Porcelain and Ceramic tiles of international quality in different sizes and colors, employing the latest technology and stateof-the-art machinery imported from Italy. Stile introduced the surface finish tiles with the quality that matches international standards for the first time in Pakistan.

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News

SRI LANKA

Royal Ceramic Group keeps pace with expansion Royal Ceramic Group, leading ceramic tile and sanitary ware producer in the Emerald Island is in the process of sanitary ware plant expansion at the company’s Athurugiriya ( known as Rocell) based plant. The company has tested and installed a new shuttle kiln at the sanitary ware manufacturing plant. The expansion will take Rocell’s installed capacity to 500,000 pieces per annum from the

current installed capacity of 250,000 pieces per annum. The new kiln, which consists of 10 cars, has a total effective volume of 100 cubic meters will allow Rocell to load pieces on 2 or 3 levels depending on the specific product models. The new kiln also features a rapid cooling system, which will reduce the entire cycle time to a minimum of 16 hours. This expansion will enable Rocell to respond to growing

demand for high quality sanitary ware in Sri Lanka and export markets. Royal Ceramic has been increasingly focusing on Austrialn ceramic market. The company inaugurated a showroom in Melbourne, last year. Royal Ceramic operates three companies in ceramic manufacturing. Besides Rocell, Royal Porcelain and Royal Ceramic Lanka are engaged in ceramic

tile production. Royal Porcelain Lanka Ltd, based at Horana has an installed capacity to produce over 11,000 square meters of porcelain tiles a day. Royal Ceramic Lanka Ltd, company’s older tile manufacturing facility, which is spread across 57 acres in Eheliyagoda has an installed capacity to produce 6,000 square meters of ceramic tiles per day.

BANGLADESH

Soaring tariffs provide boon to domestic manufacturers Bangladeshi consumers pay 70 percent more than the prices in the international market to buy imported and import-substitute products due to the country's high tariff regime, said an independent think-tank. For this reason, Dhaka is said to be one of the most expensive cities in the world to live in, said Zaidi Sattar, chairman of the Policy Research Institute of Bangladesh. “Any consumer goods you buy, the prices are well above the international levels. It is because the imports are subjected to the highest protective tariffs in the region, if not the world.” He made the remarks while presenting a paper -- 'Protection Policy, Export Diversification and the Forgotten Consumer' -- at a recent discussion held at the think-tank's office in Dhaka. Bangladesh has the highest average tariff in comparison to some selected countries such as China, India, Indonesia, Vietnam, Thailand and Turkey, according to the paper. For instance, in 2016-17, the total tariff protection was 70 percent, meaning consumers paid about $14.2 billion more for the products that year. The amount is roughly 5.7 percent of that fiscal year's GDP. According to Sattar, tariff protection is a nationalistic economic and trade policy granted to promote domestic

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industries. And because of restriction on imports, the prices of import-substitute goods produced domestically also increase, he said. “So, protection raises domestic prices above the international prices. Protection hurts consumers,” said Sattar, while terming tariff protection as subsidy on importsubstitute production. At present, consumer goods that face the highest nominal protection rates are air coolers, carbonated drinks, plastic tableware, kitchen ware, ceramic tableware and footwear. “Consumers suffer the most from existing tariff policy and they are a big part of the economy. Yet consumers seem to have no voice in prebudget talks -- the budget affects them,” Sattar said. When the interests of consumers and producers are in conflict, there is a need to strike a balance, according to the expert. The high tariff protection also discourages exports as tariffs make sales in the domestic market more profitable than exports. “Protective tariff has an inherent bias against exports,” Sattar added. Tariff protection creates inefficiency among producers, so they should not continue for long, said AB Mirza Azizul Islam, a former finance adviser to a caretaker government. “There should be a transition

policy,” he added. Citing the protection given to importsubstitute industries such as steel, PRI Executive Director Ahsan H Mansur said any country can produce anything but the question that needs to be asked is at what price. He stated the high tariffs on steel imports as a case in point. “Why are you buying steel at Tk 75,000 a tonne? Bangladesh has never had a comparative advantage in steel. We are not allocating our resources properly,” he added. Bangladesh has not taken serious tariff reforms since the mid-90s, said Selim Raihan, executive director of the South Asian Network on Economic Modelling. Trade policy in Bangladesh is primarily a revenue-seeking policy, he added. “Development works are suffering for the spiral in rod and cement prices. Why is such a high protection?” asked Ghulam Rahman, president of the Consumers Association of Bangladesh. He went on to rue that consumers' interests are not considered properly in government policy-making. “It is never said that the budget should be consumerfriendly. Rather, it is said that the budget should be business-friendly, industryfriendly. Political parties also do not talk about the interests of consumers.”

NEWS IN BRIEF Investors from China are interested in building factories in Russia for the production of construction tools and ceramic tiles, AiF reports has reported. These enterprises they want to set up in Nevinnomyssk, a city in the Stavropol region, Russia, where all the necessary infrastructure and tax incentives for foreigners are provided. New factories will supply these products to the Russian market and will also export them abroad. These opportunities were negotiated by a delegation from China and the authorities of the Stavropol region at a meeting held on the premises of the regional Ministry of Economic Development and Trade. Apart from this, Chinese entrepreneurs are interested in the cooperation in the field of agriculture, industry, and tourism. It is noteworthy that the Stavropol region’s government offers favorable conditions to foreign partners.

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News

BANGLADESH

China-Bangla gives green light to expansion The spiralling growth of the ceramics industry is encouraging entrepreneurs to invest more in the sector, experts said. Twenty new entrepreneurs are getting ready to enter the sector, said Shirajul Islam Mollah, president of the Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA). Local ceramics makers are also planning to expand their business in the field, he said. China-Bangla Ceramic Industries Ltd, which started production in 2009, plans to invest Tk 200 crore to increase

production capacity, said Mollah, who is also the managing director of the company. Islami Bank Bangladesh is providing finance to set up the second unit of the joint venture between Bangladesh and China that was incorporated in 2001, he said. China-Bangla currently employs 750 people and the new factory will need 800 more, said Mollah, also a lawmaker. The new unit will annually produce 3.60 lakh square feet of tiles, he said. The demand for ceramics in Bangladesh is increasing by 20

percent on an average every year, according to data from the BCMEA. The sector, with a market size of around Tk 29,000 crore, has experienced a 200 percent growth in production in the last 10 years, and Bangladesh now holds 0.14 percent of the global export market, it said. The sector caters to 80 percent of the local demand, Mollah said. Ceramic makers in Bangladesh mainly produce three items: tiles, tableware and sanitaryware, he said. Presently there are 62 ceramic

INDIA

Gas company split to favour ceramics industry India plans to split state-run gas utility GAIL by March next year to create two companies: one marketing gas, and another operating pipelines that can be used by consumers who buy direct from producers, the head of the sector’s regulator told Reuters. GAIL (India) Ltd is the country’s biggest gas marketing and trading firm and owns most of the nation’s pipelines, giving it a stranglehold on the market for the fuel. By splitting GAIL, the regulator of India’s oil and gas sector hopes to increase the number of gas consumers and attract the billions of dollars needed to expand the pipeline network and build more liquefied natural gas (LNG) terminals.

“All this un-bundling should be done within this fiscal year (to March 31, 2019),” D.K. Sarraf, chairman of India’s Petroleum and Natural Gas Board, told Reuters. GAIL already keeps separate accounts for its gas pipeline and marketing businesses, making it easier to split them into two entities before a change of ownership, he said. Sarraf did not say which business GAIL would retain. India’s Oil Minister Dharmendra Pradhan in January said the company should focus on laying pipelines, suggesting it is the marketing side that would be hived off. By unbundling GAIL and opening the sector, the government hopes to increase

gas use and meet its objective of raising the share of a cleaner, cheaper fuel as a part of the energy mix to 15 percent, from 6.2 percent, in the next 12 years. Many power plants and small industries like ceramic, glass and cement makers rely heavily on more expensive or dirtier fuels such as naphtha, diesel and coal. In future, though, even small companies will be able to buy gas via pipelines, without having to go through GAIL. Only a handful of companies - including Petronet LNG Ltd , Indian Oil Corp Ltd and Gujarat State Petroleum Corp - currently import and sell gas in India. The gas regulator hopes by July, however, to draft norms for allowing end-users to bid for using LNG terminals to

manufacturers in Bangladesh. Of them, 20 produce tableware, 25 tiles and 16 sanitaryware. Businesses have so far invested Tk 9,000 crore in the sector and provided jobs to five lakh workers, two lakh of whom are women, the BCMEA said. In 2016-17, local ceramic makers exported $41.82 million worth of products to over 50 countries, including the USA, UK, Canada and some European and Latin American countries, according to the National Board of Revenue and the Export Promotion Bureau. import gas. “We are planning to put LNG terminals on public access to the extent of 20 percent,” Sarraf said. The regulator was also looking at how to open access to the pipeline network for smaller buyers. India’s gas demand is constrained by low domestic output, a small number of LNG terminals - just four - and a pipeline network that does not reach enough customers. GAIL owns more than two-thirds of India’s existing 15,000 km (940 miles) of pipelines, but the government wants to more than double the network to expand gas deliveries. While the new pipeline company created by the division of GAIL would be expected to lead the way, the government also wants other companies to bid for rights to build and operate pipelines.

SRI LANKA

Manufacturers urged to go “niche” Sri Lankan ceramic manufacturers should consider focusing on making personalised products now increasingly being demanded by overseas buyers, a European Union trade official said. “European consumers are moving more towards personalised products which Sri Lanka can provide,” said Roshan Lyman, deputy head of politics and trade , delegation of the

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European Union to Sri Lanka. “China can’t do that.” Personalised products were a small but growing niche market, he told the Sri Lanka Ceramic & Glass Symposium 2018, organized by the Sri Lanka Ceramic & Glass Council, an affiliated trade body of the Ceylon Chamber of Commerce. European demand for dinnerware fell in 2013 and as a result many European firms in the

manufacturing business closed down which created an opportunity for Sri Lankan firms to fill the gap. By 2015 the market recovery had started and Europe now imports 50 percent from outside the EU, Lyman said. “The European market needs a lot of storytelling. They need to have a history behind the product. Sri Lankan has an opportunity to go that way because in the mass

market China is the leader, so it is difficult to compete with them.” The EU imported 1.8 billion euro worth of dinnerware in 2016, half from developing countries with Germany’s imports at 350 million euro and the UK’s at 265 million euro. China has 41% of the EU market for dinnerware. Lyman said an area where Sri Lankan exporters can look at is personalised design, such as family logos or shields buyers want on their dinnerware.

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News

IRAN

Mixed messages over health of the industry The output of Iran’s tile and ceramic industry has reportedly increased by 15.8 percent during the first nine months of the current fiscal year, started March 2017. The country produced 268 million square meters of tile and ceramic in the 9-month period, according to the latest data released by the Iranian Ministry of Industries, Mining and Trade. Iran produced 31.7 million square meters of tiles and ceramics in the ninth calendar month (Nov. 20-Dec. 20), 0.2 percent less compared to the preceding month. The country’s tiles and ceramics output amounted to 292.5 million square meters last fiscal year (ended March 20, 2017), 4.4 percent less year-on-year. Iranian officials have earlier announced that the country’s tile and ceramic industry’s nominal production capacity stands at 700 million square meters per year. The officials have also said that 133 manufacturing units are active in tile and ceramic production nationwide.

However, not everyone seems to share the same level of optimism. Conflicting view from the association and industry players, seem to paint a very different image of a sector over-burdened with supply and operating at half mast. Producing half of the 550 million square meters per year of the domestic output of tiles and ceramics, Yazd Province is the production hub of these products in Iran, the deputy head of Iran’s Tiles and Ceramics Association has said. “There are 76 production units active in the field in Yazd and the industry has created jobs for close to 300,000 people from the province’s 1.138 million population,” Nasrollah SharifFard was also quoted as saying by IRNA. Iran’s tile industry enjoys cheap and abundant energy and raw materials combined with indigenous expertise rooted in history. However, due to the market recession caused by an ongoing stagnation in the construction sector as well as the tile and ceramic industry’s overproduction due

to the unrestrained issuance of factory licenses during the 1990s, production and exports have followed a downtrend over the past few years and growth in domestic demand has been weak. Chairman of Iran Ceramic Producers Syndicate Behnam Aziz-Zadeh said last year that more than 150 million square meters of tiles and ceramics in excess demand were piled up in warehouses across the country. “Local producers are operating at less than half their production capacity,” he said. The production capacity of Iran’s tile and ceramic industry stands at about 700 million square meters whereas actual production is in the neighbourhood of 400 million square meters per year, said former minister of industries, mining and trade, Mohammad Reza Nematzadeh, at the opening ceremony of the 24th International Exhibition of Tile, Ceramic and Sanitaryware, also known as CERAFAIR 2017, opened in Tehran last year. The ex-minister noted that close

to $350 million worth of tiles and ceramics were exported from Iran during the fiscal 2016-17. Overproduction in the industry came about after Iranian producers experienced a seven-year boom owing to the controversial state project Mehr Housing Plan, which was initiated in 2007 by the previous administration with the aim of providing two million lowincome people with housing units through free land and cheap credit. The plan, however, slowed down due to lack of funding, which dragged down domestic demand for construction materials in the process. In the face of the slump in domestic market, producers have turned to exports. Iraq, Afghanistan, Pakistan, Turkmenistan, Georgia, the UAE, Tajikistan, Armenia, Uzbekistan and Azerbaijan are major buyers of Iranian tiles. Iranian tile producers have to compete with foreign producers, especially the Chinese, which have lower production costs and a considerably higher economies of scale.

PAKISTAN

Zibo sees potential for local joint-ventures A Chinese delegation, from City of Zibo, has expressed keen interest to have joint ventures in ceramics sector of Pakistan. The delegation visited Pakistan on the invitation of Pak-China Joint Chamber of Commerce and Industry (PCJCCI), and held a meeting with local industrialists of ceramics sector. PCJCCI President S.M. Naveed delivered address of welcome to the delegation headed by Wang Chenzhong. Joint Chamber’s Senior Vice President Prof. Dr. M. Iqbal Qureshi, Vice President Rana Mahmood Iqbal Khan, Secretary Salahuddin Hanif and a number of prominent businessmen and government officers also attended the

16

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meeting, according to a PCJCCI spokesperson. On this occasion, Wang Chenzhong, who is also Head Exhibition Committee of Zibo Chamber of Commerce and Industry, said that Zibo, being a key transportation hub of China, was also playing an important role in the country’s economy through its rapidly growing manufacturing industries, especially in ceramics sector. He was impressed by the growth potential of ceramics industry of Pakistan. He agreed to relocate ceramic industries from Zibo into Pakistan for sharing the global demand of ceramics products by exploiting inherent advantages of Pakistan and China.

He added that 70 percent work of Chinese ceramic industry was being done under the expertise of Zibo industries and the products produced in Zibo were being exported to US, EU and other sophisticated markets. Zibo was ranked as the 34th most competitive city in China according to the Chinese Academy of Social Sciences in 2016,he said, adding that Zibo had a significantly large industry sector that accounted for 47% of the GDP in China. Earlier, S.M. Naveed apprised the Chinese delegation about the strong support to be extended by PCJCCI for economic development of the two countries. He said that the joint ventures of Pakistani and

Chinese businessmen under CPEC had attained a highest level of mutual confidence that was giving birth to new venues of collaboration in trade and investment areas. He thanked the Chinese business community to pave way for modern phase of the industrialization in Pakistan and also creating a space for Pakistan in international markets through joint ventures. On the occasion, PCJCCI arranged a visit of the Chinese delegates to two housing societies to review the construction techniques being used in Pakistan and to suggest innovative Chinese techniques for the betterment of the local construction industry.

www.asianceramics.com


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News

International News

Imerys to sell roof tile business France

F

rance’s Imerys is selling its roof tiles business as it streamlines its portfolio, people close to the matter said, expecting the asset to be valued at around 1 billion euros ($1.2 billion), with private equity most likely to clinch the deal. The Paris-listed minerals company has hired JPMorgan and Rothschild to sell the asset, which has annual earnings before interest, tax, depreciation and amortization of around 115

million euros, and may sell for around 9-9.5 times that, the sources said. Private equity funds Cinven, Lone Star and Carlyle bid for the company and final round bids were due in around three weeks, the sources said, who did not want to be named. One said Cinven was bidding together with Belgiums’s Etex. Imerys is a multinational company with a market capitalization of almost 6 billion

euros and 2017 revenue of 4.6 billion euros and 890 million euros of EBITDA. The tiles unit is part of Imerys’ ceramic materials unit, which saw its sales and earnings decline last year as it struggled with a mix of weak house renovation markets, a challenging paper market for its kaolin ops and robust emerging markets demand for houseware and technical ceramics. The private equity bidders for the roofing tiles business are no

strangers to the industry. Lone Star in 2016 bought Germanbased building materials maker Xella. Cinven owns Chryso, a French maker of additives for construction materials and Carlyle is invested in Spanish building materials group Cupa. Johnson & Johnson and a unit of Imerys, Imerys Talc America, were recently told to pay $117 million in damages in a case linking cancer to asbestos in talc.

Smalticeram to invest in Tennessee United States

S

malticeram USA, Inc. will invest $4 million to locate new operations in Mount Pleasant, TN. The ceramic and tile ink, glaze and pigment producer and distributor will create 26 new jobs in Maury County. The company’s new operations will be located in a 50,000-square-foot facility in Mount Pleasant’s Cherry Glen Industrial Park, a Select Tennessee Certified Site. With this new location, Smalticeram will be better equipped to serve its North American customers. “Smalticeram has been in business for almost 50 years in the sector of industrial ceramic.

With the opening of a branch in Mount Pleasant, it will take us a step further in the program of internationalization,” said President of Smalticeram Carlo Alberto Ovi. “Today, the market of North America has become strategic for our group and it offers us excellent opportunities. We are sure Tennessee will reflect at best all of our needs and we will do anything to make our finest contribution for the growth of the Mount Pleasant.” Smalticeram USA, Inc. produces and distributes glazes, frits, pigments and inks for ceramic tiles. Headquartered in Italy,

Smalticeram has operations across the globe. “I want to thank Smalticeram for creating 26 new jobs and investing over $4 million in Maury County,” said Tennessee Department of Economic and Community Development Commissioner Bob Rolfe. “It is exciting news that yet another foreign-owned company is choosing to locate its operations in our state. Tennessee currently has more than 960 foreign-owned establishments and I am grateful to Smalticeram for continuing to grow foreign direct investment in our state.” “We are very excited to welcome

Smalticeram to Maury County and Mount Pleasant. Adding a worldclass company such as this greatly enhances our growing ceramics cluster,” said Maury County Mayor Charlie Norman. “Also, we are very proud of the joint partnership between the Industrial Development Board of Maury County, Mount Pleasant Power System, City of Mount Pleasant, Maury County Commission, TVA and the Maury Alliance that developed the building which enabled this company to successfully locate in the Select Tennessee Certified Site, Cherry Glen Industrial Park.”

Tariff fears grow over electroceramics United States

“W

e need to prepare for the worst and hope for the best,” says ECSN and IDEA chairman Adam Fletcher, following the announcement that US proposes an additional tariff of 25% on electronic components produced in China and imported into the US. The list of electronic components included contains over 1,400 products includes all tantalum, aluminium, ceramic, paper or plastic capacitors, many carbon, composition or film resistors, fuses, relays, LEDs, transistors, thyristors lithium, air

18

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AC 18-4

zinc and silver oxide primary cell batteries. It also includes some consumer products, many automotive products and industrial equipment. According to Fletcher, chairman of the International Distribution of Electronics Association (IDEA), the application of the proposed tariffs to these electronic products would obviously increase direct costs to customers in the US but also transactional costs for manufacturers and manufacturer authorised distributors involved in the import of goods from China into the US. To avoid the tariff manufacturers

and manufacturer authorised distributors would have to ensure goods were not re-shipped into the US from China via a third-party country. “It’s an additional administrative burden for the entire electronic components supply network where the lead-times for passive components are already significantly extended,” said Fletcher. “There have been some suggestions that the current products listed on the Harmonised Tariff Schedule Annex are part of a wider negotiating strategy between US and Chinese Officials,”

continued Fletcher. “I hope that is the case, but our industry must react quickly to request that all electronic components are removed from the proposed schedule during the consultation process”. Distributor members of IDEA are in the process of formulating a position paper to submit to US Trade Representative requesting that electronic components are removed from the Annex during the consultation process which begins with submission of written comments. The first stage was due to be completed as AC went to press.

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News

Raw Material News Broken Hill extends mineral sands reach ZIRCON // Australia

Broken Hill Prospecting has expanded its heavy mineral sands footprint in the Murray Basin to encompass 7,300 square kilometres of granted tenements in the region, after securing four new exploration licences totalling 4,163sq km. Another licence that runs along strike from Broken Hill’s existing Tararra project in New South Wales was also pegged. The new licences position Broken Hill as the largest mineral sands tenement holder in the Murray Basin. According to the company, the new tenements are close to key infrastructure and host multiple heavy mineral sands strandline lines. The latest acquisition is part of Broken Hill’s strategy to become a low cost mobile miner in the area. Broken Hill is developing a pipeline of low-tonnage but high-grade heavy mineral sands deposits that could be processed through its modular and mobile equipment. To ensure it has secured the right project areas, Broken Hill has reviewed historical data and generated a proprietary database that

includes information from 60,000 drill holes and 2 million metres of drilling. “The granting of four new exploration tenements with walk up resource targets places the company in a strong position,” Broken Hill managing director Trangie Johnston said. “We now have critical mass to accelerate these projects at a time of strong underlying market conditions,” he added. An extensive exploration program has been planned to kick-off shortly and will include validating historic data and undertaking geological modelling. An infill drilling program will be carried out over the new tenements once it has been planned. As with other commodities, the heavy mineral sands market has been languishing for the last five years. However, as stockpiles have been drawn down and little money invested in finding new deposits, supplies have tightened triggering much needed price rises during the past year. “Mineral sands commodity prices continue to perform well, and we are seeing improved financial performance from existing mineral sands producers,” Mr Johnston said.

Piezo-development to lead to new raw material? ELECTRO-CERAMICS // India

Researchers at Bengaluru-based Indian Institute of Science have developed piezo-electric material using ceramic. Piezo-electric materials, which change their shape when an electric field is applied, have a wide range of applications from use in inkjet printers to ultrasound machines. At present, the most effective piezo-electrics are made of materials like quartz in the form of a single crystal. Such materials are more effective because it is possible to induce more strain and bring about greater change in shape in single crystals. But production of single crystals is complicated and costly affair. The efficiency of a piezoelectric material is measured in terms of electro-strain value, which indicates how much the material can change its shape when an electric field is applied. The highest electro-strain value achieved so far is 1.7 % obtained in single crystals of lead-based materials, relaxor ferroelectrics. The new material has an electro strain value of 1.3 %, according to data published in journal Nature Materials. The material reverts to its normal form when electric field is turned off. A ceramic material is made of tiny, randomly oriented metal oxide crystals or grains. When voltage is applied, areas

or domains within each grain try to orient themselves in the direction of the applied field, prompting the grain to change its shape. The extent to which a grain changes shape depends on its “spontaneous lattice strain”. The larger the strain, the more the grain can deform under an electric field. In many piezoelectric ceramics, when the voltage is turned off, the domains are unable to return to their original state. So, when voltage is applied for a second or third time, electro strain reduces drastically. This is not so with the new material. Researchers prepared a solid solution of compounds - Bismuth Ferrite and Lead Titanate- that had a large spontaneous lattice strain. The domains in this material were immobile. They then chemically modified it by adding varying amounts of lanthanum to make the domains move. At a certain critical concentration of lanthanum, the domains were able to switch back to their original state when the voltage was turned off. “Our material can be likened to a rubber band, which can be elongated repeatedly each time we stretch. On closer examination, the material showed nanoscale properties that were similar to the high-performance relaxor ferroelectrics”, explained Dr. Rajeev Ranjan, who led the research.

Minotaur navigates the mineral maze KAOLIN // Australia

Minotaur Exploration has announced an agreement with Andromeda Metals to establish a joint venture to advance their kaolin-halloysite tenements on Eyre Peninsula. The company announced last week it had signed an agreement with Andromeda in which Andromeda may earn up to 75 per cent interest in Minotaur’s kaolin-halloysite deposits in South Australia, through expenditure of $6 million over five years. Minotaur’s assets comprise three tenements containing several kaolin-halloysite deposits about 130 kilometres east of Streaky Bay, plus the Camel Lake tenement to the northwest. The creation of the joint venture is set to provide an avenue to accelerate the commercialisation of Minotaur’s kaolin assets. Minotaur’s executive director of business development Tony Belperio said there had been promise shown at its Eyre Peninsula resources and this agreement would help develop the site.

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“Minotaur is a multi-commodity exploration company with a main focus on copper gold and we have been working on kaolin as a side project for a number of years,” he said. “There is promise, but it needs its own team working on it. “Andromeda will spend up to $6m to earn 75 per cent and Minotaur can continue with our own work, but we’ll have input as we intend to keep our 25 per cent at the end.” Minotaur’s Carey’s Well deposit near Poochera has seen bulk sampling and pilot plant test work which produced samples of ‘white-bright’ kaolin – commonly known as ‘china clay’ – suitable for a range of conventional uses including high-end ceramics. Research work showed nanotubular properties of the naturally occurring halloysite, with natural nanotubes having the potential to replace manufactured carbon nanotubes in a variety of technology applications.

www.asianceramics.com



News Anaylsis

News

22

HSIL: setting a new green standard

D

asian ceramics

o pipes and fittings that go behind the walls in bathrooms make you think of renewable energy? Hardly, you might say. But changing that perception is the HSIL (formerly Hindustan Sanitaryware Industries Ltd) factory at Ishnapur village in Medak district of Telangana. The facility, which makes plasticsbased UPVC pipes and fittings, has won “Platinum rating” from the Indian Green Building Council, in a ‘first-of-itskind’ certification. For those wanting a little bit of history, this diversified building products company is known for its Hindware range. Incorporated as Hindustan Twyfords Ltd in 1960 by the Somany family in collaboration with Twyfords Limited of the UK, to introduce vitreous China ceramic sanitaryware in India, the stock exchange-listed company later became HSIL. Telling the green story with pride, Rajesh Pajnoo, President, HSIL, explains, “The manufacturing facility, operational this year, is compliant with green building norms of IGBC and is capable of providing higher yield over the prevailing industry benchmarks.” This is the first such facility in the country to achieve this rating in the PVC products-based industry and the 32nd across various industries in the country. “This would not have been possible but for planning various measures right from the factory design stage,” he says, emphasising that from at least 9 a m to 5 p m, the factory area does not need any lighting — that shows how innovatively it has been designed to use natural light. The factory, set up earlier this year with investment of ₨160 crore, could have seen 5-7 per cent of incremental higher cost in its quest to adopt green building measures. “But the best part of this is, the payback time is short and the employees take pride in working in such an environment,” he says. The facility, which makes the Truflo range of products, has an installed capacity of 30,000 tonnes per annum for CPVC (chlorinated poly venyl chloride-based thermoplastic) pipes and fittings for potable hot and cold water applications, which have been made from NSF certified Durastream CPVC compound of Sekisui of Japan, UPVC (unplasticised poly venyl chloride) pipes and fittings, SWR

AC 18-4

Pipes and fittings for soil waste and rainwater systems. In a nutshell, the factory is energy, water, process and wastemanagement efficient. What eco-friendly measures did the company adopt, to achieve this? These include use of energyefficient IE3 motors for all the production equipment; every unit consumed in the factory is monitored, measured and controlled through Energy Management System with multi-function metres, efficient compressors, chillers, cooling towers and pumps.

BUT THE BEST PART OF THIS IS, THE PAYBACK TIME IS SHORT AND THE EMPLOYEES TAKE PRIDE IN WORKING IN SUCH AN ENVIRONMENT Water at different temperatures is used for the various processes for energy efficiency and for better quality product and the entire process waste is collected and re-used. The company has completely automated its processes — from raw material to finished product — and the material compounding is done through a system that ensures consistent mixing of ingredients while preparing batches through a supervisory control and data acquisition (SCADA) system. This ensures the work is automated without any manual intervention. The pipes are weighed online, for the first time in the industry, which ensures that the promised quality is delivered. What would he want to highlight about the facility? Pajnoo says, “Apart from advanced machinery used for better productivity and consistent quality, advanced testing equipment is being used for product testing and measurement.” Besides capturing more than 90 per cent daylight, the entire lighting system is LED-powered. It has efficient fans installed for fresh air and motors for processes.

Apart from ensuring asbestos-free environs in the entire factory, the facility uses low volatile compoundbased paints and adhesives, which are workmen-friendly. To cap it all, a 1 MW solar plant takes care of the non-process power requirement of the factory. All this won it Platinum rating. That’s not all, says Pajnoo. The plant uses drip irrigation for landscaping, has 100 per cent rainwater harvesting covering both roof and non-roof area. The facility ensures zero water discharge and 100 per cent water treatment is ensured with 40 kld capacity unit. Apart from using 100 per cent CFC (chloro fluro carbons) free HVAC (heating, ventilation and airconditioning) equipment, low thermal conductivity is ensured through toughened glass. The roof insulation is with poly carbonated sheet. To promote employee welfare, cardio-vascular gym, sports facility, break-out spaces and amphi theatre have been set up. Electric charging facility has been created to encourage use of battery-operated vehicles. There is 100 per cent waste segregation to effect maximum reuse of materials within the site. The biodegradable waste is taken care of through vermi composting beds. The entire construction waste generated in the factory is reused or recycled, sums up Pajnoo. Of course, this is but an example of what might be possible. The plant is of course involved in the plastics industry, rather than directly to ceramics, but its affinity with the latter – being an integral part of the plumbing and sanitaryware offering – shows that this is an industry that doesn’t have to just be content with being involved in “waste removal”. Indeed, if HSIL can apply this level of engineering across other factories and become an industry leading light, there is hope that this polluted sub-continent would be able to view the ceramics industry not just as a purveyor of life-enhancing products, but also one where the manufacturing process itself makes a hugely positive contribution to the wellbeing of the environment. Hats off to HSIL for such an enlightened approach – wouldn’t it be great to see such standards enforced by legislation going forward across all of India’s sanitaryware – and indeed wider ceramics industry.

www.asianceramics.com


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Analysis: Iran

Gearing fo

Iran puts tiles to for the forefront

Yogender Malik looks at how the boom in Iran’s tile industry has continued to defy logic and with ambitious targets laid out by the Ministry of Trade, the momentum shows no signs of slowing…

T

he rise of Iran as a global ceramic tile manufacturing powerhouse in the last five years has surprised industry stakeholders and analysts. Indeed, the rise of the country’s ceramic tile industry has actually seemed quite astonishing, considering the fact that it virtually directly coincided with the years of tough economic sanctions that the country faced over the last ten years. In Iran, the tile industry is largely concentrated around the capital, Tehran, and in other industrial zones such as Gazvin and Semnan, Isfahan. Less central areas such as Mashhad, Tabriz and Shiraz have also become significant contributors to ceramic tile production in the country. However, it is the city of Yazd, situated about 600km southeast of Tehran on a high desert plain, which is the true locomotive of Iranian ceramic tile output. The area around Yazd (Meybod, Ardakhan) has seen exponential expansion of the ceramic tile industry, resulting in the establishment of a number of new producers. With 127 active producers, Iran has an installed capacity of more than 560 million square meters at the end of year 2017. However, low off take in domestic market and economic slowdown & political uncertainty in a number of key export markets has forced a number of ceramic tile producers in the country to operate at very low capacity utilization levels in recent years. Total ceramic tile production, which touched its peak of 489 million square meters in the year 2013, has plummeted to 301 in the calendar year 2016. Iranian Ceramic Producers Syndicate, which keeps its record

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books according to country’s financial year reported that country’s ceramic tiles output accounted for 292.5 million square meters last fiscal year (ending March 20, 2017), 4.4 percent less year on year. Though, in the first half of just concluded economic year (March 20, 2017- March 19, 2018) of the country, the production figures regained some lost ground. The output of Iranian ceramic tile industry increased by 20.6 percent during the first five months of the fiscal year 2017-18 (March 20-Aug. 22), according to the statistics of Ministry of Industries, Mining and Trade of Iran. The country’s tiles and ceramics output reached 137.904 million square meters during the 5-month period, compared to 114.332 million square meters of tiles and ceramics, produced in the country in the same period of the preceding year. Revival in the domestic market and a 4 % increase in exports during the first five months of the 2017-18 were major factors behind the increase in ceramic tiles output.

Iranian dominance

On account of its many relative advantages, such as existence of ample raw materials for ceramic tile production, cheap resources of energy, especially the natural gas, cheap and skilful manpower and the existence of various factories with high manufacturing capacity of which approximately 90 percent are equipped with state of the art technology and machinery – two third of these factories are young and have the advantages of the latest technology, Iran has emerged as the most potent force in the entire West Asia and North African region’s ceramic tile industry.

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Analysis: Iran

or growth The other important factor, which makes Iran’s ceramic tile industry a dominant force in the region is the country’s geographical location. Iran has open seas to the south and to Central Asia from north, and touching proximity to the two of the heavily reconstructing countries (Afghanistan and Iraq), who are consuming a vast amount of ceramic tiles due to almost absence of their domestic manufacturing industries. In fact, exports of ceramic tiles to Iraq have accounted for more than 50 % of total exports by Iranian producers for a number of years.

Material gains

Iran is endowed with significant resources of raw material for ceramic tile production. Emergence of specilisised downstream Raw material resources for ceramic tile industry in Iran processors of these raw materials in recent years Number of Mines has provided the Iranian ceramic tile producers a Active Inactive Equipping Total competitive edge, which is not available to most of Barite 110 42 5 157 the ceramic tile producing Bentonite 107 24 1 132 countries in the region. Barring a few high value Boron 3 2 0 5 added raw materials, Chromite 80 23 1 104 inks and pigments, Iranian producers are Clays 226 101 17 344 able to source most of Dolomite 47 17 0 64 the raw materials in their backyard. Continuous Feldspar 99 55 2 156 research in association with Iranian ceramic Fire clay 65 10 3 78 syndicate and ceramic Garnet 9 4 0 13 industry association has started to bear fruits in high Kaolin 35 17 3 55 value added raw materials Limestone 531 137 28 696 such as frits, glazes and inks. In next few years, Silica 170 97 11 278 Iranian ceramic industry is 18 11 2 31 expected to become 100 % Talc self reliant in case of these Source- Iranian Ministry of Industry & Mines critical supplies.

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Production ( Tons per year) Actual

Reserves (000 tons)

Nominal

671,316

882,831

104,087

419,693

1,156,101

44,925

180

5,500

44

367,332

523,575

10,276

2,984,462

4,921,350

826,112

862,549

1,943,600

457,802

1,128,569

2,518,200

91,367

2,840,289

3,598,200

371,326

27,131

265,511

4,112

820,067

1,296,550

68,620

109,067,832

146,000,100

15,275,660

4,802,985

6,744,539

815,140

52,492

187,700

6,160

AC 18-4

asian ceramics

25


Analysis: Iran

In pursuit of economic diversification, Iranian Ministry of Mine is providing a number of incentives to domestic miners and downstream processors to increase the value addition on processed minerals. These steps will boost the quality of finished ceramic products in the medium and long term.

Overcapacity issues

Tile exports from Iran

Exports

Imports

March 2016-March 2017

March 2015-March 2016

March 2015March 2015

March 2013-March 2014

March 2012March 2013

Volume (million sqm)

106.39

112.37

109.80

114.01

92.10

Value (in million USD)

288.06

421.44

442.58

455.51

377.00

Volume (in million sqm)

0.73

3.19

3.52

1.26

5.50

Value An installed capacity of about 560 2.88 8.93 9.36 3.23 16.42 (in million USD) million square meters for a population Source- Iranian Trade Association of ceramic tile manufacturers of about 80 million puts Iran high on the list of ratio of annual ceramic tile production capacity to population. Ceramic tile imports in some of the neighboring countries However, one must not forget that Iran is also a country where a significant population doesn’t Country 2016 2015 2014 2013 2012 2011 2010 have very high purchasing power. All these factors have resulted in a severe overcapacity Saudi Arabia 163 185 172 158 142 126 116 in domestic market. Iraq 113 119 117 103 91 74 61 The overcapacity issue in the country’s ceramic tile industry became more pronounced UAE 51 53 48 44 46 39 37 after slowdown in domestic consumption. Kuwait 24 26 29 27 26 26 22 Iranian producers experienced a seven-year boom owing to the controversial state project Qatar 25 23 18 18 16 17 14 Mehr Housing Plan, which was initiated in 2007 with the aim of providing two million lowBahrain 10 11 13 13 11 11 9 income people with housing units through Afghanistan 16 17 19 17 16 14 12 free land and cheap credit. The plan, however, slowed down due to lack of funding, which Source- Iranian Ministry of Industry & Mines dragged down domestic demand for ceramic tiles in the process. According to the Chairman of Iran Ceramic Producers Syndicate region. Though, political and economic situation in the region has Behnam Aziz-Zadeh, “ Slowdown in domestic and some of the key dampened the exports of ceramic tiles to these countries in last two exports markets led to a huge stock pile of ceramic tiles for the most years, but it is expected that Iranian ceramic tile producers will have part of year 2017. The excess inventory was highest in February a large say in future exports to these countries on the back of their 2017, when more than 150 million square meters of ceramic tiles low cost model and rapidly increasing quality standards. were piled up in warehouses across the country. For most of the Iranian ceramic tile producers produced about 293 million square 2017, local ceramic tile producers operated at about half of their meters of tiles and exported 106 million square meters of ceramic production capacity. Two main factors causing the market recession tiles during the country’s fiscal 2016-17, registering a 3 % and 5% include the ongoing stagnation in the construction sector as well as decline in volume of output and exports, respectively compared to the ceramic and tile industry’s overproduction due to unrestrained the preceding year. issuance of factory licenses during the first decade of 2000’s.” Exports of ceramic tiles from the country accounted for 36 % of Iranian Ceramic Syndicate states that domestic tile consumption total domestic production in the fiscal 2016-17. In the face of the started to decline in 2012-2013 and continued to remain in a decline slump in the domestic market, producers have been increasingly till the completion of last financial year in March 2017. Bursting of turning to exports. For a number of years, Iraq has been the biggest domestic housing bubble and slowdown in Mehr Housing Scheme export destination for Iranian tiles. In 2014, the war torn country were the main reasons for the decline in domestic consumption. accounted for more than 70% of total ceramic tile exports from Iran. Besides Iraq, Afghanistan, Pakistan, Turkmenistan, Georgia, the An export push UAE, Tajikistan, Armenia, Uzbekistan and Azerbaijan are emerging as the leading export destinations for Iranian tiles. Presence of a number of countries with huge ceramic tile imports However, bulk of ceramic tile exports to Iraq by Iranian ceramic has been one of the major reasons behind rapid expansion of tile producers is in low value category. In fact, the average per ceramic tile production capacity by Iranian producers. Besides square meter price of exports have come down drastically in their domestic market, huge imports of ceramic tiles in their neighbourhood forced Iranian producers to realize that they can recent years ( refer to table ). Recent capacity expansions and plant up gradation is expected to increase the exports of higher supply this enormous market at better prices than China and value products in coming years. India, the leading exporters to the Middle East and North Africa

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应该是最优质的氧化铝陶瓷研磨球和衬砖


Analysis: Iran Table 1

metres 292.5 415 530 780

March 2017 March 2019 March 2021 March 2025 GOAL 1: Overall 2le output

Table 1 0.288 0.44 0.62 0.86

March 2017

1.5

March 2025

1.7

2019 Authority aims forMarch Iranian tiles1.5 March 2021 1.6 GOAL 2: Export value (US$'000m.)

GOAL 3: Share of 2les in overall Iranian exports (%)

Table 1 March 2017 March 2019 March 2021 March 2025

GOAL 4: Rank of Iran in global ceramic 2le industry

A rosy future?

A country with a population of around 80 million, Iran is currently one of the biggest economies of the Middle East with a gross domestic production (GDP) of around $380 billion. Though, traditionally the main driving force of Iran’s economic growth is exports of oil, but other sectors too have started to grow along with the economy. Ceramic industry is one of the key industries, which is expected to gain immensely in the next few years. Iran’s construction market is expected to continue a relatively steady growth at a compound annual growth rate (CAGR) of 6.1% through 2020. Combined with a population of nearly 80 million, and 64% under the age of 35, the country has the ingredients to absorb 1 huge volumes of ceramic tiles in coming years. The total construction market in Iran is forecast to close at $182 billion at the end of 2018, and expected to reach $196 billion by 2020. Construction growth has been primarily driven by the residential segment, accounting for 45% of the market, due to a severe shortage of housing stock. The demand stands at 1.5 million 1 supply housing units per year, and the current market is only able to 700,000 units. Besides domestic consumption, Iranian ceramic tile producers are expected to play a major role in the regional ceramic tile industry. Even in domestic market there is a huge scope of increase Of per capita tile consumption. Currently, a large part of total domestic ceramic tile consumption takes place in Tehran and a selected few cities, but as the Iranian economy develops the economic disparity between Tehran other cities is expected to lessen, which would be a fertile ground for the consumption of ceramic tiles in these regions. A recent study shows that Iran will be among 32 most powerful economies in the world by 2050. The study, titled “The long view: how will the global economic order change by 2050?” was carried out by global consulting firm, PwC ranked 32 countries by their projected global gross domestic product by purchasing power parity. It said Iran would be the 17th most powerful economy in the world within the next three decades, adding that the country would outperform the incumbent European players like Italy, Spain and the Netherlands whose ranks would be 21st, 26th and 32nd, respectively. The Islamic Republic would also lead several Asian players like South Korea (18) as well as the Philippines (19) and Malaysia (24).

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Recent investments

As mentioned elsewhere in the article, Iranian ceramic tile producers have increasingly adopted to the state of the art technology from European technology suppliers. In last two years 1 producers (existing ceramic tile alone, about one and a half dozen producers and five new entrants) have acquired new production lines from established European technology suppliers. Leading ceramic tile producer from UAE, Rak Ceramic’s Iranian subsidiary, RAK Ceramics Iran has commenced operations at its second production line at the existing facility. RAK has been running its Iranian plant at low capacity for past few years. The company has recently installed two finishing lines at its manufacturing facil¬ity in Tehran. The first, a polish¬ing, squaring and chamfering line complete with sur¬face treatment, will be used for the production of large size tiles up to 1200x1200 mm. The sec¬ond is a speed-dry dry squaring and chamfering line which will be used for finishing large-size ce¬ramic slabs and panels. In September 2017, ceramic tile producer Rock Sanat also known as MA Ceram has signed an agreement with a leading 1 Italian technology supplier to acquire a new production line to produce large porcelain tiles in the sizes up to 1600 mm X 3200 mm in thicknesses up to 25 mm. The company will also acquired entire raw materials preparation plant, equipped with latestgeneration continuous modular mills to ensure the maximum stability and efficiency of production.

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Analysis: Iran

WITH 127 ACTIVE PRODUCERS, IRAN HAS AN INSTALLED CAPACITY OF MORE THAN 560M. SQUARE METRES Amin Tile, a new ceramic tile producer joined the growing list of Iranian ceramic tile producers. Located in the hub of Iranian ceramic tile industry at Yazd, Amin Tile commenced commercial production in early 2017 with an installed capacity of 8 million square meters of ceramic tiles. Set up by a group of local entrepreneurs: with an aim to produce high end ceramic tiles to compete in the international market, the Amin Tile plant is equipped with best in class technology to produce high quality ceramic tile products.

Technical support

Advanced technology for ceramic tile manufacturing has played a very important role in the development of Iranian ceramic tile industry in past one decade. With the ever changing face of technology and introduction of new production processes, technology will play the most crucial role in ceramic tile production in coming days. Alireza Pezeshkian- Senior Technical Manager at one of the largest ceramic tiles producers in the country, Apadana Ceram says, “ A deacde or so back, Iranian ceramic tiles were lacking in quality as most of the producers were using obsolete and factory developed production techniques. Tiles made in Iran were perceived as low quality products in export markets. But, with the widespread usage of state of the art technology, Iranian made ceramic tiles are counted among the best in the region. Now a days, almost all the new start ups and modernization exercise are adopting to modern technology, which will augur well for the future of Iranian ceramic tile industry.” Leading ceramic technology supplier Sacmi has been

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operating in the country since 2006. The Italian company has equipped a number of Iranian ceramic tile units with state of the art production technology and has played a major role in the improvement of quality standards of ceramic tiles in the country. Another leading technology supplier, SITI B & T will be opening a local branch in Iran by end of the current years. The Italian company recently signed an agreement with ceramic tile producer MA Ceram to supply a production line to produce large size tiles in the country. In last fifteen years, SITI B & T has participated in a sizable number of projects in Iranian ceramic tile industry, According to the SITI B & T management, “This new agreement marks the latest step in SITI B&T’s long standing with this leading Iranian ceramic tile manufacturer and enables the Group to introduce this innovative technology to a highly receptive market with a strong ceramic culture and tradition. The enormous potential of the Iranian market is reflected in its longstanding use of Italian technology. Given the enormous potential of the Iranian market and its strong inclination to invest in the state of the art technology, SITI B&T plans to open a local branch by the end of 2018.” Italian company System has been a key technology supplier to a number of Iranian ceramic tile producers. The company first opened its office in the country in 2012, In May 2017, the company opened its second branch office at Payam Special Economic Zone close to Teheran, an area set to become a major hub for ceramic tile production in coming years. According to System’s management, “The new facility, which involved an investment of 2 million Euros, will be able to meet the expectations of Iranian ceramic producers in a more effective manner. With a staff currently totalling around 20 employees but set to grow over the next few years, the new branch will continue to deliver high-performance industrial solutions and processes to the local ceramic industry, which we have been partnering now for more than 25 years.”

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Analysis: Heavy Clay

Tightening belts

cost savings strategies for heavy clay

Rohan Gunasekera looks at how South Asia’s heavy clay industry has been forced into a world of environmental efficiency and cost control at a time when economies are driving margins ever slimmer‌

B

rick kiln operators in South Asia have a tough choice when it comes to deciding on the investments that will make them more efficient, cleaner and competitive. Most of them rely on traditional, outdated kilns and manufacturing methods that make it difficult to maintain uniform quality and cause heavy pollution and environmental degradation. These production technologies are being outlawed under new legislation meant to improve air quality and reduce damage to farmlands and forests. But most brick industry entrepreneurs lack the capital and management knowhow to adopt modern brick making techniques. Although a shift to better, more efficient technology has begun, there is still a long way to go, and many exiting operators are likely to go out of business. Efforts are underway to industrialise the clay brick sector in the region, often with the support of aid agencies, with more automation or semi-automation of different processes. Nevertheless, the fact that dirty, low cost technologies make for easier profits are a barrier preventing faster adoption of modern technology. The clay brick industry across the region largely has a business-as-usual approach and is change-resistance, given the short production season of traditional operators, the small scale size of the production units and the non-availability of substitute products. There are five different technologies being used in brick kilns such as Fixed-Chimney Kiln (FCK), Zigzag, Hybrid Hoffman (HHK), Vertical Shaft Brick Kiln (VSBK) and Tunnel Kiln. Among these kiln technologies, the FCK is the least efficient and most polluting and the Tunnel, the most efficient and less polluting. Other technologies such as Improved Zigzag and HHK are substantially cleaner, consuming less energy and emitting much lower amounts of pollutants, but are still at an early adoption stage. The tunnel kiln, considered the most advanced brick-making technology as it is a continuous kiln producing a large amount of bricks at very low operational costs as long as there is a ready and reliable source of electricity, require 3 to 4 times more capital

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investment than traditional kilns, and are therefore suitable for medium to large firms. Low-cost versions of tunnel kilns developed in Vietnam could be useful for South Asia to adopt given their relatively low investment. But even a relatively low-cost tunnel kiln is not accessible for the many family-owned and traditional brick producers. They are more interested in medium-range investments, and the vertical shaft brick kiln is thus a more accessible solution. A VSBK is less capital-intensive than a tunnel kiln, but still can become a formal enterprise.

Zigzag upgrades

Improved Zigzag Kilns and Vertical Shaft Brick Kilns are smaller scale technologies, requiring smaller investments but nevertheless significant in terms of their impacts on energy use and emission reductions. The capital intensive nature of the changes needed for a complete transformation of the brick sector makes it a complicated barrier for small enterprises. Improved Zigzag Kiln technology combines a high efficient kiln technology, the annular kiln principle and the continuous loading and unloading process with a unique technique of forming green bricks. Granulated coal injected for internal combustion results in lower energy usage, higher quality bricks and reduced pollution. Since its initial investment is comparable with the cost of the traditional one and quick payback, IZK is suitable for small investors. In this system hollow and perforated bricks can be produced. Studies in Bangladesh, the south Asian country where outdated and traditional techniques used by the brick industry has made it notorious for air pollution and environmental degradation, have found that it still pays to stick to outdated techniques. From the initial investment point of view, according to the Department of Environment of the Ministry of Environment and Forests, the profitability of the conventional brick kilns such as Bull’s Trench Kilns (BTKs) would be the highest. If there is a long dry winter starting in early November and continuing well into April, a BTK investor is assured of a 100% return on his investment. Compared to BTK, the Fixed Chimney Kilns and Zigzag kilns will naturally have lower returns because of the significantly higher initial

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Analysis: Heavy Clay

investment. The Hybrid Hoffman Kiln being an energy efficient kilns and a proper industry has a return of only 20-25%. The Hybrid Hoffman Kilns appeared to be getting hold of the market of share of the brick sector in Bangladesh at one point. According the information provided by the Department of Environment, there were 105 HHKs in the country in 2015, many of them run by natural gas. However, with the dwindling gas supply and support from financial institutes and donor agencies, their number continues to decrease each year and stood at only 61 in 2017. On the other hand investment in modern and automatic Tunnel Kilns increased in recent years. Currently 58 tunnel kilns are in operation in different parts of the country which are due to the extension of low-cost loans by banks and financial institutions. Governments across the south Asian region are striving to transition their brick industries from a seasonal and intermittent production to industrial brick production with continuous brick-firing kilns and allyear round production. One strategy is the promotion of Resource Efficient Brick (REB) production, as their use can achieve reductions in resources being used for brick making and burning. REBs include perforated or hollow bricks and bricks made of compressed fly ash that do not require firing. Other type of REB substitutes river clay and sand and reduce the size of brick to make them resource efficient.

Weight restrictions

Perforated and hollow bricks are of lower weight and volume and have a larger surface area. These bricks can be fired with 20% less energy while maintaining the compressive strength of solid bricks. Perforated and hollow bricks can only be made with a semi-mechanized extrusion press; this requires a consistent source of electricity. While traditional kilns can produce only solid bricks, modern kilns can produce hollow bricks that consume much less energy for firing, use 40% less clay, and have much better insulation standards. However, the upfront capital costs can put technology upgrades out of reach of small-business entrepreneurs. Brick kilns emit almost a quarter of Bangladesh’s total carbon dioxide. The government is promoting a shift away from Fixed Chimney Kilns to the Improved Zigzag, Hybrid Hoffman Kiln or tunnel kilns. Technologies like the Hybrid Hoffman Kiln are more energy efficient and cleaner, producing up to seven times the amount of bricks from a traditional kiln and using 40% less fuel. Mizanur Rahman, President of the Bangladesh Brick Manufacturers and Owners Association (BBMOA), says there are over 6,000 outdated kilns in the country that need to be modernised. “Now they have started converting,” he told Asian Ceramics. “There are now very strong regulations. Pollution is too high. That’s why manual brick fields are to be closed by 2020 and many operators are going for automated and semi automated technologies.” According to government figures, there has been a significant shift between 2009 and 2017. Of the total 15.75 billion bricks produced in 2009, the FCK accounted for about 92%, other technologies were responsible for 8% of the bricks. In 18 years the mix of technologies in the brick industry has changed dramatically. From 2008 to 2017, the number of FCKs has declined from staggering 4500 to 2373. On contrary, the number of Zigzag Kilns rose to 4274 in 2017 from a mere 150 in 2009. This rapid change has taken place due to the banning of

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FCKs through a government notification effected in September 2010. Many owners have converted FCKs to Zigzag kilns. Despite this ban, FCK still continues to be operated in brick production. A few businesses have invested in modern brick kiln technology, with tunnel kilns, Rahman of BBMOA said. Most of the machinery is imported from China. China machinery is very popular in Bangladesh while European machinery is seen as very costly and Indian suppliers have not had much success in the country. The number of kilns is expected to come down sharply as regulations are enforced to remove highly polluting ones. Rahman estimates that around 2,000 kilns using modern technology should be enough to meet the demand for bricks from the construction industry, with one kiln producing on average 50,000 bricks a day.

Fuel limitations

Unfortunately for Bangladesh’s brick kiln owners, their choice of fuel is limited. The country which once had been hoping to rely on natural gas now finds there isn’t enough supply from its offshore fields to meet demand. Brick kiln owners therefore have to rely mainly on coal, most of which is imported, either from India, Indonesia or South Africa. “Kilns still use mainly coal,” said Rahman. “Our country had natural gas earlier but now gas is a problem. That’s why coal is our fuel source.” There are also tentative efforts to promote new types of products like eco-friendly bricks, hollow bricks and fly ash bricks instead of the traditional solid bricks. Bangladesh’s House Building Research Institute (HBRI) is trying to encourage production and use of ecofriendly blocks made from a combination of river mud, cement and stone called Compressed Stabilized Earth as other countries like China, Vietnam and Indonesia are doing. These bricks do not require firing in a kiln but are compressed and simply harden in the sun. Their sound and heat insulation properties are higher than that of traditional bricks. These new bricks are also lighter than traditional ones, making them easier and cheaper to transport. There’s the added benefit that dredging riverbeds for the mud to produce the new bricks will help preserve topsoil dug up to make traditional bricks. Hollow blocks is another option whose use can reduce the cost of building construction by 25 percent compared with traditional bricks. However, brick manufacturers are cautious as demand is yet to take off for these new products as buyer sentiment has not changed. Rahman, President of BBMOA, says there are producers of hollow blocks using Chinese-made machinery. “The government wants the industry to diversify its product range and go for new products like cement and fly ash blocks. But very few are doing so as the demand is still very limited,” he said. “They are not expensive but our people feel clay brick is still better.” Rahman acknowledges the need for the brick industry to adopt new production methods and products. “But the shift will take some time. If clay brick availability goes down then there’ll be more interest in cement and fly ash bricks and other types.”

New product hope?

The shift to new products will also help with ensuring sustainable use of raw materials ad help reduce degradation of farm lands and forests. “In Bangladesh the main raw material is still clay which comes mainly from farm land,” said Rahman.

AC 18-4

asian ceramics

33


Analysis: Heavy Clay

And large scale automation of brick manufacturing and even semi automation is still some way off, even though there is a government program to give cheap loans using international donor funding. “Yes, there is the beginnings of a shift,” said Rahman. “Now there are about 60 tunnel kilns. But automated kilns are very costly. That’s why adoption is slow.” Loans are given at 7% for runnel kilns but only a few can afford to take such loans to install tunnel kilns, Rahman said, who estimates the payback period at around 4-5 years. “For tunnel kilns the main is problem money and land – that’s why the adoption rate is slow.” Tunnel kilns and Hybrid Hoffman Kilns, having production capacity of 3 to 4 times of FCK or Zigzag, are clearly the most expensive requiring an initial investment of at least Taka 50 million. Building a HHK or Tunnel Kiln also requires special expertise and thus involves engaging engineering consultants mostly from foreign countries. Because of their greater production, the requirements for land to establish kilns and soils for brick making are 3-4 times higher than that of FCK or Zigzag technology. Uninterrupted supply of required amount of clay during the wet seasons to run these factories in optimum production levels is a major problem in Bangladesh. In India in recent years, several new walling construction technologies and materials have been introduced, but in the foreseeable future, bricks are expected to retain its dominant position. Given the large anticipated growth in the building construction, the annual demand for bricks in India is expected to peak to 750–1000 billion standard brick units (SBUs) a year during 2032–37 from about 250 SBUs a year during 2012–17, according to a study by Shakti Sustainable Energy Foundation and Greentech Knowledge Solutions Pvt. Ltd. Their study, Roadmap for Promoting Resource Efficient Bricks in India: A 2032 strategy, estimates the total number of manufacturing units at around 250,000 and 300,000 spread throughout the country. A majority of the units (>98% in number of units and contributing to >90% of the production) belong to the unorganised industrial sector. The number producing solid burnt clay bricks ranges from 140,000 to 210,000. Indo-Gangetic plains account for about 65% of total burnt clay brick production in the country. Uttar Pradesh, Bihar, West Bengal, Punjab, and Haryana are the major brick producing states in this region; owing to the easy availability of fertile alluvium soils. The typical production capacity of the enterprises ranges from 30 lakh to 80 lakh bricks a year. The total number of enterprises is estimated to range between 40,000 and 50,000. The capital cost for the construction of a Fixed Chimney Bull’s Trench Kiln (FCBTK), which can produce about 5 million bricks a year is about INR 30–50 lakhs. While FCBTK is the main brick kiln technology for firing of bricks, in recent years, 3,000– 4,000 FCBTKs have been converted into more efficient zigzag kilns. Peninsular, coastal, and desert regions account for the remaining 35% of solid burnt clay brick production. The main raw material for making bricks (brick earth) is available only in small pockets and hence the industry is distributed. Gujarat, Rajasthan, and Tamil Nadu are important brick producing states. Leaving aside a few big burnt clay brick making clusters located around Nagpur, Chennai, Coimbatore, Madurai, Bengaluru, etc., which are using FCBTK technology, a majority of the brick manufacturing units are small (annual production <20 lakh bricks a year) and use clamps or other intermittent kilns for firing of bricks. The rate of adoption of mechanisation is higher in this region compared to the IndoGangetic plains. Overcapacity and low profitability are concerns in some regions: There is significant over capacity for manufacturing of bricks in certain states like Punjab where the installed burnt clay brick production

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Indian market for bricks (estimates in billion standard bricks/year) Type of brick

Annual consumption

Solid burnt clay bricks

243 billion bricks/year

Hollow and perforated burnt clay bricks

0.2 billion bricks/year

Pulverised fuel-ash lime/cement bricks

11.7 billion bricks/year

Autoclaved aerated concrete blocks

4.4 billion bricks/year

Concrete blocks

15 billion bricks/year

Total

274 billion bricks/year

capacity is way above the required capacity, resulting in severe pressure on profitability.

Moving from FCBTK

According to the Shakti Foundation and Greentech Knowledge study, a move from FCBTK to zigzag kiln requires relatively lower investment (maximum INR 40 lakh) and has a high IRR of 100–250% due to substantial savings in coal and improvement in brick quality. However, the next steps in the transition from manually moulded solid brick to perforated or hollow burnt clay brick requires 7–30 times higher investment. This also involves risks related with new technology, creating market for new products, uncertainty in raw material supply, etc. “If one can manage these risks, the IRR for these investments is still attractive,” the study said. Solid burnt clay bricks still retain about 89% of the market for bricks. The other bricks such as concrete blocks, pulverised fuel-ash lime/ cement bricks, and hollow and perforated burnt clay bricks together make up for the rest of the market. The market for alternative bricks, particularly autoclaved aerated concrete (AAC) blocks, has grown during the last decade. In the high-rise construction, the preference is for lighter materials and materials/technologies, which allows for faster rate of construction and requires less skilled workers. The growing market for autoclaved aerated concrete blocks and monolithic construction is mainly explained based on this preference. The housing on smaller plots of land, urban slums and urban villages are mostly low-rise and self-constructed. Usually traditional construction technologies and materials are used in this segment. Burnt clay bricks and in some areas pulverised fuel ash bricks are the main walling materials. The penetration of alternative materials is rather limited. Solid burnt clay bricks are the main material for masonry construction in the Himalayan and North-eastern states (except Assam and Tripura). In the North-eastern states, concrete blocks also have significant market share. In the Indo-Gangetic plains, Assam, and Tripura, traditionally only solid burnt clay bricks were used and still maintain the top position. However, AAC blocks due to their lower weight, lower thermal conductivity, and faster construction have gained a significant part of the market in the National Capital Region (NCR) and Kolkata. These blocks have been introduced in other major urban centres in the region like Chandigarh and Lucknow. In most urban areas of peninsular, desert, and coastal India, there is no single type of brick that is dominant. In most of the cities in this region, several types of bricks are being used, which may consist of solid burnt clay brick, AAC blocks, pulverised fuel ash bricks, and concrete blocks. In some areas burnt clay bricks dominate the market (e.g., north Rajasthan, Madurai). But there are pockets where solid

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Analysis: Heavy Clay Brick production technology economics compared to the baseline of traditional Fixed Chimney Bull’s Trench Kiln Product specification

concrete blocks (e.g., Karnataka), AAC blocks(e.g., Pune, Surat) and fly ash bricks (e.g., parts of Maharashtra and Andhra Pradesh) have large market shares. Five states – Maharashtra, Uttar Pradesh, Tamil Nadu, Gujarat, and West Bengal - constitute more than 50% of the urban brick demand, while five states – Uttar Pradesh, Bihar, West Bengal, Andhra Pradesh and Telangana combined, and Rajasthan - constitute more than 50% of the rural brick demand.

Life of brick system Prodn. Capacity

Type of product

New Zigzag solid bricks

New Zigzag and extruder perforated bricks

Tunnel kiln, dryer and extruder; hollow bricks

Dimension (mm)

230 x 115 x 75

230 x 115 x 75

400 x 200 x 200

Weight (kg/ brick/block)

3/brick

2.4/brick

11/block

20

20

25

Year

8,600

13,000

86,000

INR (lakh)

40

300

1,300

Coal savings/year

tonne/annum

160

430

3,700

Coal savings/lifetime

tonne/lifetime

3,200

8,600

92,500

Coal savings/year

INR lakh/year

13

34.5

300

INR lakh

250

680

7,400

Capital cost

Coal savings/lifetime

cu. Metre/year

Lack of automation

mechanisation, and scale of production. Almost all the existing Most of the brick kilns in India are non-mechanised or use basic level burnt clay brick manufacturing enterprises, manufacture hollow and of mechanisation in the manufacturing process. The industry has perforated clay bricks as secondary products. For them, the primary grown rapidly during last three decades, with its production increasing product is usually common burnt clay solid brick or roofing tile. from 50 billion in 1985 to 243 billion in 2015. This rapid expansion of Thus, their manufacturing facilities are not optimised for hollow and brick making with only small improvements in its technology has given perforated clay brick production, and none of the producers (except rise to many environmental concerns. Wienerberger) possess an integrated production line. Because of lack A recent study has estimated that there are about 400 brick of assured market, and lack of any financial support/low-cost financing manufacturing units in the country, which are equipped with extruders, options to upgrade technology, the enterprises are hesitant to invest in needed to make perforated and hollow burnt clay brick. Compared to integrated production lines. solid burnt clay bricks, perforated and hollow burnt clay bricks require The typical investment for an AAC blocks plant having 0.1 million controlled drying and careful handling. These enterprises are mainly m3 a year capacity is INR 15–20 crore, according to the Shakti located in three southern states of Karnataka, Tamil Nadu, and Kerala; Foundation and Greentech Knowledge study. There were about 75 and in some other pockets like Balaghat (Madhya Pradesh), Manipur, industrial units, all belonging to the organised sector, manufacturing and around Chandigarh. However, only 45 of these enterprises are AAC blocks in the country, with a total installed production capacity producing perforated and hollow burnt clay bricks; rest of them are equivalent to about 6.3 billion standard size bricks a year (12 million producing solid bricks or roofing tiles. While perforated burnt clay m3/year). An AAC manufacturing plant needs to be in the vicinity of bricks are mostly manufactured in north India (Punjab, Haryana), thermal power plants for uninterrupted supply of key raw material—fly hollow burnt clay bricks are manufactured mainly around Bengaluru ash at low cost (transportation costs) as well as should be near to the and Kerala. The total production of hollow and perforated bricks in the large urban centres. country is estimated at about 0.22 billion bricks a year in 2015. The AAC plants face competition from the cement industry in the production of perforated and hollow burnt clay bricks has increased at procurement of fly ash. Given these requirements, AAC manufacturing 16% CAGR during 2011–15. is limited to only a few centres in the country. The top five states in While hollow burnt clay blocks are being mostly used in high-rise terms of AAC production are Gujarat (main cluster around Surat), residential buildings and individual housing; perforated burnt clay Maharashtra (main cluster around Pune), Haryana, Telangana (main bricks have their main market in institutional buildings followed by the cluster around Hyderabad), and West Bengal, contributing to 75% individual housing. In both the cases, the market for perforated and of the total installed production capacity. With increasing acceptance hollow burnt clay bricks is predominantly urban. of the product in Indian construction activities, the AAC block Wienerberger India Private Limited, a unit of the world’s largest clay manufacturers registered continuous growth in total operating income brick manufacturer Wienerberger AG, is the largest manufacturer of over past five years. However, profitability has shown declining trend hollow burnt clay bricks in the country with an estimated production of due to significant increase in installed capacities of AAC block in a short 100 million standard bricks a year. The company has a modern hollow span of time together with strong competition from cheaper clay bricks. brick manufacturing facility at Kunigal near Bengaluru with the total investment Bangladesh brick industry analysis estimated at INR 200 crore. Number % of total Annual % of total Number % of total Annual % of total All the other manufacturers of prodn. production prodn. production perforated and hollow bricks in the (tonnes) (tonnes) country are much smaller in size and 4,500 92.21 13.5 89.46 2373 35.19 7.1 31.16 are usually organised sector brick or roofing tile manufacturers who have 150 3.07 0.5 2.98 4247 62.97 12.7 5.76 diversified into perforated and hollow 30 0.61 0.5 3.58 61 0.9 1.1 4.81 brick production. The typical capital 0 0 0 0 58 0.86 1.7 7.62 investment on plant and machinery in these enterprises varies from INR 200 4.1 0.6 3.98 5 0.07 0.2 0.66 2 crore to 20 crore depending on 4880 100 100 100 6744 100 22.8 100 the technology choice, degree of

36

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Analysis: Tiles

Spoilt for tiles buying trends in the Middle East AC looks at how the expanding range of tile options from new entrants and established players in the Middle East ceramics industry has led to increasing price competition in certain sectors‌

W

ith a number of offerings in floor and wall segment, customers are spoilt with a number of options in choosing their ceramic tile needs. However, different regions, age groups and end user segments often choose different variants

of ceramic tiles.

In context‌

constructions, race to outdo other countries in high rise and premium constructions and upcoming events like Dubai 2020 expo and FIFA World Cup in 2020 in Doha has led to a very steady growth in the demand of ceramic tiles from almost all the countries in the region. UAE and Saudi Arabia are two of the largest and most lucrative ceramic tile markets from the volume and value point of view. Both markets are leading the growth of regional ceramic tile industry, and are being driven by young and fast-growing demographics, in addition to long-term transformational plans with Saudi Vision 2030 and the UAE Vision 2021. Some of the other countries in the region- particularly Qatar and Oman-are also catching up with the two leaders in demand growth of ceramic tile industry. Presence of two of the top global ceramic tile producers- RAK Ceramics and Saudi Ceramics- and emergence of a number of

GCC or the Middle East region has emerged as one of the largest and most lucrative ceramic tiles markets, globally. The United Arab Emirates (UAE) is the most active construction market in the region, with the Kingdom of Saudi Arabia (KSA) and Qatar contributing as growth centers. There are over 10,000 projects under construction or in the design and planning phase in the GCC. The large-scale Population split of GCC countries construction projects in Country Population Nationals this region consistently feed the demand for Bahrain 1,423,726 664,707 large volumes of ceramic tiles. Kuwait 4,411,124 1,337,693 High per capita Oman 4,599,051 2,488,755 income of most of the countries in Qatar 2,677,022 243,073 the region, rush of petro Dollars, Saudi Arabia 31,742,308 20,064,970 emergence of the region as United Arab Emir8,264,070 947,997 a tourist and ates business hub, Total 53,113,301 25,747,195 never stopping

38

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Non-nationals

Luxury segment Nationals

Non-nationals

759,019

46.7

53.3

3,073,431

30.3

69.7

2,110,296

54.1

45.9

1,456,362

14.3

85.7

11,677,338

63.2

36.8

7,316,073

11.5

88.5

26,392,519

49.4

50.6

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Analysis: Tiles

choice? second tier producers in the region offers a number of options to the ceramic tile users in the region. Besides regional production, imports play a major role in the GCC tiles market; the region imports almost 40 per cent of its total demand. China, Spain, Italy, Egypt, and India are the largest exporters of tiles to the countries in the GCC. The region also actively exports tiles mainly to other nations in the Middle East and Africa. It is able to competitively price its products mainly due to the availability of raw materials and comparatively lower energy prices. Though, exact numbers for ceramic tile consumption and production in the region in 2017 are not out. But, the ceramic tile industry had made gains of more than 8 % in volumes in the just concluded year. Regional construction market has exhibited growth in 2017, recording a 30% rise on year-onyear basis. According to a study by MENA Research Partners (MRP), projects worth $130bn were completed in the region in 2017, $30bn more compared to $100 billion for the whole of 2016, despite headwinds that extended from low oil prices to budget adjustments in many GCC countries.

Oil slump a continued benefit

Though, it might sound surprising, but, slump in the oil prices is expected to act as a booster for ceramic tile consumption in the region. Though, in the short term, slump in the oil prices has severely affected the economies of most of the countries in the Gulf Cooperation Council (GCC), which has lowered government revenues which have negatively affected spending plans. Oil price volatility is anticipated to continue in the short and medium term. GCC governments expect to raise non-oil sector revenues to fund their spending programs and reinforce the regional economic growth. Most of the governments are reviewing their spending commitments and priorities on infrastructure projects. One of the key non-oil sectors that are earmarked to help diversify revenue streams and economic base is real estate, hospitality and construction. These activities will boost the ceramic tile demand to a further high in the region.

High per capita usage

With a total demand of 526 million square meters of ceramic tile in 2016, GCC region is one of the highest per capita users of ceramic tiles in Asia. Though, per capita tile usage differs from country to

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country (globally, UAE is the largest per capita user of ceramic tiles), but overall per capita tile usage in the region averages much higher than the global usage amount.

Differing demands

Before understanding the buying trends for ceramic tiles in the GCC region, it is important to understand the end-using segments in terms of residential, commercial, retail and hospitality sub-segments in the GCC region. More than 60 % of the volume and about 72 % of the total sales value of ceramic tiles comes from commercial subsegment of construction in the Middle East region. Large & luxurious hotels, commercial establishments, hospitals and educational institutes accounts for majority of consumption of premium and luxury ceramic tile products. Governments in the GCC countries are currently undertaking a number of measures to cope with oil price fluctuations and are continuously reviewing their spending priorities. GCC countries are expected to spend USD 560 billion on construction in the current year and 2019. Regional governments are now aggressively pursuing economic diversification programmes, and therefore capitalising on other revenue-generating sectors. This is evident in GCC economies retaining spending on key sectors such as hospitality to promote tourism, education, and healthcare. Accounting for 40 % of the volume and 28 % of the value, residential segment has increased its share in the total ceramic tiles market in recent years. Increasing importance of residential market in the total construction mix has influenced the structural change in distribution of tiles in the Middle East. The market is characterized by a large number of high-rise apartments built by large and international contractors on one side and, on the other side; individual units are built countrywide by local contractors. While large projects procure directly, small individual units procure through the distribution or merchant network. Regional ceramic producers account for about 34 % of this high value demand, while, the rest, i.e. 66 % of the regional demand for high value ceramic tile is met through imports, primarily from Europe, China and India. UAE, Saudi Arabia and Qatar are three largest users and importers of these premium and luxury ceramic tiles. These three countries imported about 62 %, 68 % and 100 % of their ceramic tiles demand in 2016.

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Analysis: Tiles

Table 1 Saudi Arabia UAE Oman Kuwait Qatar Bahrain

236 139 49 44 39 19

Ceramic tile buying trends in GCC Countries

Ceramic )le demand (m. sq metres)

Regional governments’ commitment to host mega events, such as Expo 2020 Dubai, 2022 FIFA World Cup Qatar and various initiatives of the GCC governments should boost the consumption of premium and luxury ceramic tile products.

High value purchases

In ceramic tile industry, the purchasing trends are greatly influenced by macroeconomic and demographic factors of any country / region. High GDP, increasing per capita income and higher purchasing power, which are some of the key chracterstics Table 1 of the Middle East region play an important role in the purchase of high value/ higher quality ceramic tiles. 7.43 Saudi Arabia (HNI) Home to a large number of High Net worth Individuals UAE 16.81 makes GCC region a natural choice for luxuryOman and high-quality 10.65 Kuwait demands 9.97 products. The vast number of large-scale projects 14.46 Qatar high-quality tiles mainly from the European market. The Middle Bahrain 13.35 East is the largest importer of ceramic tiles from Europe. Due to slowdown in European economies and construction markets, high-quality products have found their way into the Middle East market where there is a significant demand for the same.

Per capita usage (sq metres)

Large size ceramic tiles

Large sized ceramic tiles and mega slabs for wall & floor segments and countertop surfaces in large sizes (120 x 260 cm, 120 x 240 cm and 120 x 120 cm) have become very popular in last few years in the Middle East region. Offered in thicknesses of 6mm to12 mm, these mega slabs are preferred in commercial and high value home segments. Stefan Schmied of RAK Ceramics says that large Table 1format tiles are gaining in popularity, as they provide a setting that promotes a very open look. According to Schmied, “The new Arabia 4486.00% trend at the moment is to go biggerSaudi and bolder. RAK Ceramics 2642.00% UAE created an evolution in the large tiles segment of the industry Oman 931.00% with the launch of the extra-large format slab which appears 836.00% Kuwait almost as a single flooring or wall piece. Qatar The company 741.00% was the first to manufacture it in theBahrain region using SACMI361.00% Continua+ technology. Maximus mega slab is available in four gigantic sizes (135x305cm, 120x240cm, 120x120cm and 290x240cm) and three thicknesses giving customers the flexibility to choose.” RAK Ceramics began manufacturing of large size tiles back in 2001, when leading technology supplier Sacmi supplied (for the very first time outside the Sassuolo district) the technology needed to make tiles as big as 1200x1800 and up to 2 cm thick, a result then achieved with traditional pressing methods and a high-tonnage PH7200 press. Mohammed El Shamy, director of Dubai, UAE based Arteco Ceramics, says that its large sized ceramic tiles have been very successful in the region due to its luxury appeal. Shamy says, “We are proud to be the leading distributors of the large format porcelain tile from leading Italian ceramic tile producer, Graniti Fiandre. Maximum series, in its innovative 300x150cm format, combines design freedom with great flexibility. On one hand the maxi-slab dramatically reduces the number of interruptions in the design unit and, on the other, the wide range of submultiples offered guarantees great versatility for all requirements. Maximum aims to offer a new architectural concept that goes beyond that of an individual slab. It enables designers to reinvent design criteria, giving them maximum freedom and minimal restrictions.”

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1 Demand % within the region Saudi Arabia

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UAE

Oman

Kuwait

Qatar

Bahrain

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Analysis: Tiles

GOVERNMENTS EXPECT TO RAISE NON-OIL SECTOR REVENUES TO FUND SPENDING PROGRAMS AND REINFORCE GROWTH

Demand growth for large-format ceramic tiles is expected to remain very popular in next few years due to high applicability in varied end-user applications.

New and Unique designs

Launch of new and unique designs has become an important feature in global ceramic tile industry in recent years. The Middle East region is one of the pioneers in this aspect. Most of the companies have been launching new and eye catching designs on a regular basis to appeal to the discerning consumers of the region. Oman based Al Maha Ceramics launched hexagon shaped tiles in the month of December 2017. The company launched heaxagon shaped uni-tiles in 30 cm X 30 cm with 8 mm thickness which can be laid both on wall and floor in symmetry. The company offers an attractive range of tiles with modern Italian designs for discerning consumers in the region. According to Rajeev Singh, General Manager of Al Maha Ceramics, “We strive to surpass the expectations of our customers with the innovative designs and high quality finish of the tiles. The company is first in the GCC region to launch the hexagon shaped ceramic tiles. Our hexagon shaped tiles have opened a new chapter in tiles laying concept unleashing the creativity of architects and designers. We are committed in keeping abreast with the technological advance in ceramic tile manufacturing, which enables us to launch innovative products on a regular basis.” Speaking on the recent acquisition of a new polishing and squaring line, Rajeev says, “ We are adding two new sub-brands to our portfolio - ‘Reflexon’ which is a high polished digitally printed tile that is available in random patterns with superior strength; and ‘Diamond Edge’, which is a superior quality rectified

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tiles range. Through the launch of our new polishing and squaring lines, with this launch we are focusing to boost our local market share, while also concentrating on exporting our products to other countries in the GCC and MENA region.” Stefan Schmied of RAK Ceramics says, “Ceramics industry has become very fast paced in the recent years. There is a significant demand for new design trends to complement the shifting tastes of consumers and the latest fashions in interior design. Luxurious materials and aesthetics are becoming even more important. The design trends are inspired from nature. Companies are trying to achieve natural look and feel in terms of colours, patterns and the touch of the ceramic surface. This gives customers aesthetics of nature and durability of ceramics. The feel, finish and touch that emulate natural products is appreciated and demanded by customers, whether it’s wood, metal or marble.”

Importance of Colours & Appearance

Ceramics tiles were considered as a utility during the late 90’s and early years of 2000’s, but, now a days colours and designs have started to become one of the most important factors in the selection process of tiles. According to Prafful Gattani of Oman Porcelain, “The difference between the Middle Eastern and global tile market is probably the aesthetic appearance, consumer tastes and additional regional preferences, such as highly sustainable, water resistant, antimicrobial and fireproof qualities. Product prices could also vary between the Middle East and global destinations, as they are primarily determined by the application of tiles and not necessarily the models. The colour trends are different especially for individual clients where a preference of busier tonalities and veins can be clearly seen along with a fondness for very polished finishes.”

High competition and influx of low priced products

Though, GCC countries have one of the highest per capita incomes and one of the highest living standards. But, there is a very healthy demand of low priced ceramic tiles in the region. While, a few years back the demand of most of the low price products was from the housing for expats and smaller cities and the towns in the region. But, low oil prices have forced most of the governments in the region to drastically cut their expenditure. This has resulted in these low priced ceramic tiles products finding a huge market in government run projects in the region.

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

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Š Duravit AG


Analysis: Tiles Table 1 Year

m. sq metres 2011 72 2012 84 2013 84 Ibrahim Al Haidari, Saudi Ceramic’s Executive 2014 Vice President 86 2015 starts to market 92 of Marketing and Sales, “Recently, the company

Saudi ceramic )le produc)on (m. sq metres)

its new product "Saudi Ceramic Company Porcelain" in local and regional markets at low prices up to 24 riyals per each square meter, as a contribution for provision of products with high quality and low prices in the local markets. The new porcelain is hard and bears high temperature for hard and several uses in internal and external areas of the building. In addition, the porcelain is supplied with a thick layer with high scratch resistance, along with a high Moisture resistance that does not exceed 0, 5% of water observation, which makes it have a long life span and maintain its purity and brightness.”

Influx of Low-cost Imports from China & India

Imports and influx of low-cost imports from China and India has cornered a significant share of the GCC ceramic tile Table 1 market in recent years. European Union’s anti-dumping on Chinese ceramic tile products has diverted a huge volume of ceramic tiles meant Year m. sq metres for European markets to the Middle East by Chinese producers. 2011 90 In last four years, India has also emerged as2012 a strong player 92 in 2013 97 the GCC ceramic tile industry. Currently, India is second largest 2014 96 exporter to the region on volume basis. 2015 93 Most of the ceramic tile from China and India goes to the low cost housing and government projects in the region.

UAE ceramic )le produc)on (m. sq metres)

Expats and Youth Influencing Product Preferences

Product preferences in ceramic tile industry in the GCC region are changing rapidly owing to expanding expat population and altering expectations from the young population. This has not only influenced product developments but also the marketing and sales strategies of ceramic tile producers and suppliers. Not only are GCC millennials the majority of theTable region's 1 consumer base, but they are also, increasingly, taking important decisions in purchases. Ceramic tile producers and supplier in the 2011 24 Middle East need to attract and engage with local millennials in 28 2012 order to be successful in the region. As for marketers, the focus is34 2013 no longer the region’s wealthiest people, but its2014 booming middle 39 2015 40 class , most of who were born in the 80s and 90s. 2016

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Bathrooms getting important for ceramic tile producers

Much like their global counterparts, Middle Eastern consumers are increasingly paying more attention to their bathroom spaces, which account for approximately 8- 10 % of the total ceramic tile consumption. As lifestyles become increasingly hectic and fast-paced, the bathroom has become an ever more important space for relaxation and rejuvenation, away from distractions and disturbances. Home owners are placing more emphasis on the bathroom - from allocating more square meters to fitting and furnishing the bathroom into a luxurious and enjoyable private space which resembles a stylish premium hotel bathroom. While standard colours like white have dominated interior design for years, they have become insufficient to meet the changing needs of home owners, who are seeking to individualise their bathroom through different ways, including adding different hues and tones into this private rejuvenation space. Colour is an indispensable part of our lives and has taken over not only furniture, fabrics, walls and floors but also the bathroom, including tiles and walls.

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Oman ceramic )le produc)on (m. sq metres)

1

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Analysis: China

Province profile:

Fujian

gas uptake fuels efficiency drive In the next of our exclusive Chinese Province Profiles, we turn our attention to Fujian – a region that has rationalized its position in traditional tile making, avoided the growth of major, dominant brands and expanded its presence in the growing rustic tile market.

S

tatistics show that there were 234 ceramic tile enterprisesin Fujian in 2017, of which, 38 are in Minqing, 20 in Zhangzhou, 131 in JInjiang, 42 in Nan’an, 2 in Xiamen, and 1 in Luoyuan. The number of workers and staff working in ceramic tile industry there is 55,700, of whom 42,491 are directly for production. Fujian production area possess 516 ceramic tile production lines in 2017, with total daily production capacity of 5,162.6k.sq metres,. and 21 western roof tile production lines with total daily capacity of 769k. pcs,. Among them, 228 are exterior wall tile lines with daily capacity of 2,329k.sq metres, 156 rustic tile (including wood train tile ) lines with daily capacity of 1,535k.sq metres, 22 polished glazed tile lines with daily capacity of 247k.sq metres, 45 interior wall til lineswith daily capacity of 650k.sq metres, 13 large-size panel lines with daily capacity of 111k.sq metres, 9 small floor tile (including water permeable tile) lines with daily capacity of 90k.sq metres, 5 border tile lines with daily capacity of 28k.sq metres and 33 other tile lines ( including crystal tile, polished crystal tile, split tile, Terracotta panel, hexagonal tile, paving tile, swimming pool tile, unfired tile and mosaic tile) with daily capacity of 172.6k.sq metres. In the last three years, an adjustment of product structure has been carried out in the Fujian production area. Compared with that of 2014, the number of ceramic tile enterprises hsa reduced by 12, number of production lines is reduced by 38 and the daily capacity is reduced by 432.4k.sq metres. The number of exterior wall tiles is greatly reduced by 76 and the daily capacity is reduced by 751k.sq metres, the number of interior wall tile lines for is reduced by 27 and the daily

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capacity reduced by 431k.sq metres, the number of western roof tile lines is reduced by 4 and the daily capacity is increased by 21k.pcs. Two products are eliminated in Fujian production area, namely microcrystalline tile and polished tile. While the number of production lines and daily capacity of interior tiles and exterior wall tiles are reduced greatly, the number of rustic tile lines is greatly increased by 51 and the daily capacity increased by 486k.sq metres; the number of polished glazed tile lines is increased by 12 and the daily capacity increased by 140k.sq metres,and the number of large-size panel lines is increased by 10 and the daily capacity is increased by 94,000 sq metres. In addition, compared with that of 2014, Fujian production area possesses 486 inkjet ptinters, 141 more than the number of 2014. In 2015, two ceramic enterprises in Putian area are shut down and eliminated due to environmental protection. Then in 2017, an enterprise with 2 production lines in Luoyuan is put into operation as new member of Fujian production area.

Quanzhou: lines drop by 40%

The three ceramic production areas: Quanzhou in Fujian, Foshan in Guangdong and Zibo in Shandong were starting almost at same time, all started their ceramic industry in 1980’s and made great achievement in this field. The difference is that the three places have formed a unique pattern in their later development. Quanzhou’s major production areas of ceramic tiles are Jinjiang and Nan’an. The enterprises are mostly concented in Cizao town, Neikeng town, Zimao town, Anhai town of Jinjiang as well as Guanqiao town and Shuitou town of Nan’an. The towns mentioned above are vicinity

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Analysis: China

of each other, and therefore, it is known that among all the large ceramic production areas in China, Quanzhou is the one that has the most concentrated production. Wu Shengtuan, chairman of commerce chamber in JInjiang Cizao, says that there were once more than 700 production lines in Quanzhou area in its peak period, then exterior wall tile and western roof tile produced there were selling very well throughout China, with their exterior wall tile occupying about 80% of the domestic market. According to reporter’s statistics, there are 173 ceramic tile enterprises with 416 production lines in Quanzhou in 2017. Among them 20 are western roof tile lines with daily capacity of 665,000 pieces, and 396 floor/wall tile lines with daily capacity of 3,799,000 sq metres.

Company closures

Compared with the statistics of a previous major study in 2014, the number of Quanzhou’s ceramic tile enterprise is reduced by around 10 and the number of production lines is reduced from 460 in 2014 to 416 today, which indicates that it enters negative growth stage of production capacity. Most of ceramic tile enterprises in Quanzhou were established before 2000, with the old production lines of poor production capacity forming a well known barrier of the production area, and while a single production line in new production area achieved a daily capacity of more than 50k. sq metres, the average single line daily capacity of Quanzhou’s ceramic tile enterprises was lower than 10k.sq metres. Therefore, some poor production capacity is eliminated in this new found of transformation and upgrading. The insufficient market competitiveness of Quanzhou’s ceramic tile enterprises is due to their production capacity and also their extremely single product structure. It is known from the investigation in 2014 that there were around 300 exterior wall tile lines in Quanzhou production area, accounting for about 70% of the total lines there, producing a type of product of the largest proportion, with western roof tile lines immediately following it. However, at that time, new production areas all began to show their competitiveness. For example, Gaoan of Jiangxi, Dangyang of Hubei, and Tengxian of Guanxi all had quick expansions of production capacity, and their advantages in terms of larger capacity and lower cost formed a great impact on Quanzhou ceramic tile enterprises, consequently, Quanzhou’s ceramic tile industry that greatly relied on exterior wall tile was facing an unprecedented challenge. Then stricter requirements of environmental protection issued in 2014 added to the serious market status. Quanzhou is the first ceramic production area in China to implement the policy of replacing coal with gas for tile production. “At that time, the price of natural gas was RMB 4 per m3, namely 3 or 4 times of the coal price.” Wu Shengtuan recalled. Nowadays, price of natural gas is reduced, but price of natural gas for ceramic tile enterprise in Quanzhou area still keeps at a level of RMB 2.3 – 2.6 per m3, and to worsen the situation, it is disclosed by some informed people that the price of natural gas in Quanzhou is likely to be adjusted upward. It is well known that exterior wall tile is a product of small profit, and a production of tile by using expensive

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natural gas can lead to an increased production cost, which, plus the unfavorable status in market competition, bring about a difficult challenge to Quanzhou’s ceramic tile industry.

Rustic tile lines booming

Quanzhou’s ceramic tile enterprises began to have transformation in recent years in order to moderate the pressure of increasing cost as well as get rid of disadvantages caused by a model of extremely single product, as a result, a great change of local product model took place, and except for some enterprises whose particular location and area made their transformation impossible, most of the enterprises have begun to try a transformation for products with higher added value, such as rustic tile, wood finish tile, thin tile and so on. For example, the number of exterior wall tile lines is reduced from about 300 in 2014 to 213 today, while in contrary, the number of ustic tile lines is increased to 113 with daily capacity of 1,067k.sq metres to become the second largest type of the local products, and at the same time, polished glazed tile, thin interior wall tile and thin panel all began to have a good status of development. The market burst out of big demand for modern rustic tiles. It is pointed out by Chen Shunzong, sales chief of Fujian Huatai Group, that currently about half rustic tiles in China are produced in Fujian. The reporter’s statistics show that nowadays there are more than 60 ceramic enterprises in Quanzhou are participating in production of rustic tiles, and among them, some have become excellent enterprises for production of rustic tiles, such as Baoda, Guoxing, Caiba, Lianxing, Yuanlong, JInchdeng and so on. In addition, some enterprises that are well-known for production of exterior wall tiles also began to participate in production of rustic tiles and thin tiles, such as Haoshan and Tengda. It is an analysis by Zhang Gang, a member from Nanan Baoda Building Materials Company, that analysis based on the current situation of Fujian production area can indicate that glazed porcelain tile (also called rustic tile) is undoubtedly the backbone for development of ceramic tile industry in Fujian production area. It is said that Quanzhou area will not approve any more for construction of ceramic tile lines, and it is hardly possible for existing ceramic tile enterprises to have a thorough change due to limitation of particular locations and areas. Interviewees generally believe that rustic tile production, which don’t have high requirement for production equipment, will be the main direction for transformation and upgrading of local ceramic tile enterprises. However, the transformation and upgrading are not an easy job. It is disclosed by Jiang Hua, chief sales supervisor of Fujian Jinjiang Jincheng Ceramics, that with the increasing production capacity of rustic tiles in the past 3 years, the price of local rustic tile is declined by 70%. Zhang Gang further pointed out that under the surface of the exciting transformation and upgrading campaign, only a part of enterprises have a clear target, most of the enterprises are just following the trend。 This caused an unbalanced status, which can be seen not only in sales, but also frequently seen in production. He believes that for producing rustic tile of good quality, Fujian is lack of many professionals.

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Analysis: China

Major marketing slowdown

Currently the major marketing channels of Quanzhou’s ceramic tile enterprises are wholesale, export and OEM. Especially since 2017, sales proportion by OEM is increasing quickly. Thanks to a flexible production capacity, Quanzhou ceramic enterprises are obtaining many orders in OEM market. However, it is still hard to establish self-owned brand, and the pivotal reason herein is small profit obtainable to most of the local enterprises. The fund source of Fujian enterprises is from enterprise itself, without other financing channel, and the profit obtained only from production of enterprises is far from enough to meet the financing requirement for brand construction. It is a comment by Wu Shengtuan “Nowadays investment on environmental protection as well as an increasing production cost already brought about a big pressure to enterprises, while under such a situation, we should keep to survive first, and only when we have profit, can we think about brand construction.” His opinion is shared by many people. The interviewees all agree that although there are a lot of ceramic tile enterprises in Fujian, the number of enterprises that is powerful for brand construction is limited, especially on aspect of professionals, design, research and development. In spite of a strong appeal for brand construction there, most of the local enterprises don’t dare to start for brand construction. Restricted by a hot competition within the production area itself, most of ceramic tile enterprises in Quanzhou are still busy with cutprice competition. Zhang Gang believes that Professional division and separation of production and marketing is likely the final solution for better development of Fujian ceramic tile industry.

Minqing builds on exports

Minqing’s ceramic tile industry started in 1970’s and most of the existing ceramic tile enterprises started at the end of 1990’s or in the beginning of 2000’s. There were once 252 ceramic tile enterprises during its peak period and, while in 2012, Minqing county carried out a transformation and upgrading for its ceramic tile industry by reducing the number of its ceramic tile enterprises, including merging and reorganization, adjusting its enterprise structure, and at the same time, comprehensive treatment measures for pollution control, establishing Industrial Air Pollution Control and Treatment Program as well as Comprehensive Treatment for Ceramic Industry Pollution Control. After the hard efforts such as continuous treatment, shutdown, and transformation, nowadays it is reported by statistics of Changzheng survey group to have only 38 ceramic tile enterprises. Minqing’s ceramic tile enterprises are located along Meixi river basin, mostly in Bandong, Baizhang, Baizhong, Jinsha and Chiyuan, and currently there are 38 enterprises, totally having 50 production lines. Of which, 8 rustic tile lines with daily capacity of 99k.sq metres, 32 interior wall tile lines with daily capacity of 514k.sq metres, 2 polished glazed tile lines with daily capacity of 27k.sq metres, 4 small floor tile lines with daily capacity of 48k.sq metres, 2 exterior wall tile lines with daily capacity of 22k.sq metres, as well as 1 crystal tile line and another one line. The statistics indicate a single product structure of its ceramic enterprises, mostly for production of interior wall tile. Development of Minqing’s ceramic tile industry is slow in recent years as their equipment is old and poor, the enterprise scale is small, and most of the enterprises only having 1 or 2 production lines, and only Haoye Ceramics have 3 production lines. Minqing county is in a mountainous region, flat area is limited, having little space for enterprise expansion, and most of its ceramic tile enterprises choose to locate in the vicinity of Meixi river basin. The county was hunted in 2016 by typhoon Nepartak and three enterprises close to Meixi river were completely destroyed,

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while JInge Ceramics, one of the three, located in sandbank close to the river, was totally destroyed, no recovery as of today. Furthermore, with the population is growing, the ceramic tile enterprises originally located in remote areas is enveloped by the expanding of the town, into people’s residential area, which, due to increasing stricter requirements today for environmental protection, is also a potential problem for its further development. As far as resources are concerned, the richest resource in Minqing is kaolin, having a geological reserves of 15 million tonnes, with the current exploitation accounting for about 43% of the total. However, it is disclosed by Wu Shengliang, chairman of Jincheng Ceramics, that the local government doesn’t allow any exploitation of the rich kaolin resource, so the raw materials such as clay are transported from Jinjiang. The cost of local kaolin transported to factory is RMB 40 per tonne, while that from Jinjiang is RMB 50 per tonne. As for frits, there are only 2 – 3 frit factories in Minqing, located in Bandong and Chipu, while most of frits used are purchased from Zibo, Shandong, and closing down of some frit production in in Zibo is causing a growing price increase of frits. Wang Yongsong, chairman of Hengshunda Ceramics, introduced that price of frits in Minqing keeps increasing at a monthly rate of RMB 200 – 400 per tonne. Furthermore, Minqing started implementation of replacing coal with gas since 2014, which raised the fuel cost of ceramic tile enterprise. Under a pressure of increasing cost on many aspects, there is no much development room for its ceramic tile enterprises, except for its port advantage. Its superior product – interior wall tile is also facing impact of mass production in Linyi and Neihuang production areas. Affected by restriction of multiple factors, a lot of ceramic tile enterprises in Minqing choose to locate their factories in other production areas, such as in Faku (Liaoning), Midong (Xinjiang), Yimen (Yunnan), Neihuang (Henan), Zhaoqing (Guangdong) and so on, building more factories in these areas than in Minqing itself. Besides, most of ceramic tile enterprises in Minqing are relying on export of OEM products, making little effort for construction of selfowned brand. The reporter’s investigation indicates that amongst the 38 ceramic tile enterprises in Minqing, more than half have no brand, for most of the enterprises, more than half of their products are for export, with some enterprises having very high proportion for export, even over 80%.

Zhangzhou: lining up expansion

Zhaozhou, as a new production area in Fujian, is built to accept ceramic enterprises transferred from Jinjiang, locating these enterprises mostly in Pinghe county, Changtai county, Hua’an county and Nanjing county. Most of these were built around 2010 and some even being completed in 2017. Compared with old production areas such as Mingqing and Jinjiang, most of Zhangzhou’s tile enterprises have larger land occupation and bigger production capacity to form a scale effect. For example, Wanli International Holdings possesses 16 production lines, and their equipment is better, and their planning is more rational than that of those old production areas. As for resources, clay and sand reserves in Zhangzhou are rich enough to provide raw materials needed for ceramic tile production. Another point, implementation of replacing coal with gas has not been started yet herein, water gas still being the major fuel, which, compared with production of natural gas, can reduce the cost by around 30%. Statistics show that there are 20 enterprises currently in Zhaozhou with 61 production lines and daily capacity of 568k.sq metres, of which, 13 are exterior wall tile lineswith daily capacity of 140k.sq metres, 29 rustic tile lines with daily capacity of 319k.sq metres, 5

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Analysis: China

polished glazed tile lines with daily capacity of 55k.sq metres, 3 large-size panel lines with daily capacity of 23k.sq metres, 1 small floor tile (water permeable tile) with daily capacity of 3k.sq metres, 1 western roof tile line with daily capacity of 104k.pcs, and 9 other tile lines, such as crystal tile, split tile, terracotta panel, hexagonal tile and so on, with daily capacity of 18k.sq metres. In addition, while the policy of industrial structure adjustment and production capacity reduction is being implemented in other production areas throughout China, another 7 production lines in Zhangzhou have been approved for planning or under construction. Of which, 3 lines waiting for construction are in Tianxing Ceramic Industry and are planned to start production in next year, 1 large-size panel line in Zhangzhou Jianhua Ceramics is planned to be completed next year, 2 lines in Fujian Qiaofeng Ceramics are planned to be constructed by end of this year, 1 water permeable tile line is under construction in Zhaozhou Wanbaoda Ceramics while Wanli International Holdings is about to change its 4 terracotta panel lines for production of water permeable tiles.

Xiamen , Putian and Luoyuan

There are 2 ceramic enterprises currently in Xiamen, namely Xiamen Sanwon Ceramics and Tong Long Ceramic, both coming from Taiwan in 1992 approximately. Together there are 7 production lines in these two companies, 5 are rustic tile lines with daily capacity of 30k.sq metres, 1 mosaic tile line with daily capacity of 600 sq metres, and 1 large-size panel line with daily capacity of 2k.sq metres. But when reporter came to Tong Long Ceramic on 10th September it had been shut down for renting. There were once 8 ceramic tile enterprises in Putian in its peak period, but by 2014 only 2 enterprises survived with difficulties. When the reporter came again to Putian Dongdu industrial zone on 9th November, two enterprises there had been shut down. The office building of Shuangfa becoming ceramic tile wholesale shop and equipment and machines dismantled. The workshop and office building of Fengyuan both dismantled, the factory becoming a vegetable market, and it is said that these 2 enterprises were shut down in 2015. While Putian ceramic industry was declining, Luoyuan ceramic industry was growing very fast, with 2 production lines of Fujian Desheng New Building Materials put into operation on 18th April, 2017, all located in Luoyuan JIngang industrial Zone. According to Guo Haibing, assistant to the general manager and manager of production department, this company belongs to Fujian Wusteel Group whose steel mill produces a lot of coke oven gas, relying on which, they began to prepare for ceramic tile production. This new enterprise has a land occupation of over 400k.sq metres, with a total investment over RMB 300 million. The first phase with 3 production lines will be completed and the second phase will have another 4 lines. It is introduced by Guo Haibing that the workshop is of a two-story structure, with furnace, inkjet printers and glazing lines arranged in the second floor, and automatic packing line in the first floor. The equipment mainly consists of Keda furnace of completed line as well as 4 System inkjet printers. The 2 production lines in the first phase have been put into operation, mainly for production of rustic tiles and marble tiles, covering sizes of 300×800mm, 450×900mm, 600×600mm, 800×800mm, 600×1200mm and so on. Now they are preparing for the third line that is planned to start operation by end of this year and

50

asian ceramics

AC 18-4

is designed for production of 1800×900mm large-size panel. Lv Jianzhong, deputy general manager of Fujian Desheng New Building Materials, said that their factory is built on saline-alkaline land by reclaiming land from sea, so the infrastructure investment is very high, even more expensive than equipment purchase. Nowadays, construction of a new ceramic production line must be subject to environment evaluation of much higher requirements, and investment on environmental protection is much higher than before. For example, the cost for pollutant dumping right of 5 years is over RMB 20 million, and their investment on environmental protection facilities is over RMB 10 million.

A lack of brands

Fujian, may be one of the eight ceramic bases in China, the largest production base for exterior wall tiles in China, and the second largest production capacity of ceramics. In 2016, its production capacity reached 2.46 billion sq.metres with a value of 61.3 billion yuan. Yet despite this prominence, it lacks top ceramic brands like MARCO POLO and DONG PENG. So, what's the reason? Actually, many years ago, Fujian’s exterior wall tiles had great influence in Chinese ceramic industry and Fujian also had many top brands in the filed of exterior ceramics. But, in recent years, the ceramic companies in Fujian have gradually shifted to produce rustic tiles due to the upgrading of the industry and the shrink of the market of exterior wall tiles. Unfortunately, they haven’t set up any top brands. Though some ceramic companies that specialized in rustic tiles have presented in Fujian, they do no have much influence in the whole industry. • Most of Fujian ceramic companies run the companies by the family. So, they tend to be clubby. And it will make the talents find it hard to fit into the company. As a result, the innovative ability of the Fujian ceramic companies are weakened. If there is no innovation in the management model and business philosophy and the products, then ceramic companies will find it tough to build up the top brands in the market. • Fujian lags behind Guangdong and Shandong in many field, such as the ceramic machine, supply of raw materials, product design and R&D. Thus, Fujian’s ceramic companies face the challenge of high cost price, low added value and competitiveness. • When Fujian’s ceramic companies shifted to produce rustic tiles, they continued to wholesale their products. And it is the mode which seriously restricted the development of the brand of rustic tiles in Fujian. Although Fujian currently lacks top brands now, it could make efforts to change this situation. Firstly, Fujian government can introduce the favourable policies that attract talents and excellent ceramic companies to work in Fujian base. For example, the government can provide the talents with financial assistance and offer the excellent ceramic companies favourable tax. Besides, Fujian government can cooperate with some local powerful ceramic companies to build up a public service platform which can serve all ceramic companies in Fujian ceramic base. Thus, it can help to enhance the cohesion among local ceramic companies and the competiveness. Fujian ceramic companies should also try their best to grab the increasing market of rustic tiles, and get out of the vicious circle of low-price competition.

www.asianceramics.com



Analysis: China City

County/District

Company

Tile line & capacity (k.m2/d)

Total capacity (k.m2/d)

Number of inkjet printers

Jinjiang

Cizao

Fujian Huatai Group Co., Ltd.

3 rustic tile lines: 30; 4 terracotta panel lines: 6

36

3

Jinjiang

Cizao

Fujian Lisheng Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

1

Jinjiang

Cizao

Jinjiang Haoda Building Materials Co., Ltd.

2 rustic tile lines: 20; 1 polished glazed tile line: 10

30

3

Jinjiang

Cizao

Jinjiang Juntao Ceramic Industry Co., Ltd.

1 polished glazed tile line: 10

10

2

Jinjiang

Cizao

Bisheng (Fujian) Building Materials Co., Ltd.

1 rustic tile line: 10; 2 exterior wall tile lines: 50ï¼› 2 western roof tile lines: 100k.pcs/d

60, 100k. pcs/d

5 1

Jinjiang

Cizao

Quanzhou Deshun Ceramics Co., Ltd.

3 border tile lines: 12

12

Jinjiang

Cizao

Jinjiang Xinshengya Ceramic Industry Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Quanzhou Yaofeng Ceramics Co., Ltd.

2 polished crystal tile lines: 4

4

1

Jinjiang

Cizao

Jinjiang Guangda Ceramics Co., Ltd.

4 exterior wall tile lines: 50

50

4

Jinjiang

Cizao

Jinjiang Meisheng Building Materials Co., Ltd.

1 rustic tile line: 10; 2 exterior wall tile lines: 20; 1 western roof tile line: 60k.pcs/d

40; 60k. pcs/d

4

Jinjiang

Cizao

Jinjiang Danhao Ceramics Co., Ltd.

1 panel line: 8; 2 polished glazed tile lines: 20

28

5

Jinjiang

Cizao

Jinjiang Huaqiang Building Ceramics Factory

2 exterior wall tile lines: 20

20

2

Jinjiang

Cizao

Jinjiang Jinshan Building Materials Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Jinjiang Guangxia Building Ceramics Factory

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Fujian Zhengyu Building Ceramics Factory

1 small floor tile line: 6

6

Jinjiang

Cizao

Jinjiang Xiangda Ceramics Co., Ltd.

3 exterior wall tile lines: 30

30

Jinjiang

Cizao

Quanzhou Kaiji Building Materials Co., Ltd.

1 split tile line: 10

10

Jinjiang

Cizao

Jinjiang Daxin Building Materials Co., Ltd.

1 exterior wall tile line: 10

10

Jinjiang

Cizao

Jinjiang Yinkeng Ceramics Co., Ltd.

2 western roof tile lines: 20k.pcs/d

20k.pcs/d

Jinjiang

Cizao

Jinjiang Jianxin Ceramics Co., Ltd.

1 rustic tile line: 10

10

Jinjiang

Cizao

Jinjiang Haiyan Building Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

2

1

Jinjiang

Cizao

Jinjiang Minbao Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

2

Jinjiang

Cizao

Quanzhou Meixing Ceramics Co., Ltd.

1 rustic tile line: 8

8

1

Jinjiang

Cizao

Fujian Youshng Group Co., Ltd.

2 rustic tile lines: 20

20

2

Jinjiang

Cizao

Jinjiang Yiyou Building Materials Co., Ltd.

1 exterior wall tile line: 10

10

1

Jinjiang

Cizao

Jinjiang Gaoxing Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Jinjiang Jilian Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

Jinjiang

Cizao

Fujian Deqi Building Materials Co., Ltd.

1 Chinese spool roof tile line: 13k.pcs/d

13k.pcs/d

Jinjiang

Cizao

Jinjiang Zhongshanrong Ceramics Co., Ltd.

1 split tile line: 7

7

Jinjiang

Cizao

Jinjiang Hengxin Ceramics Co., Ltd.

1 split tile line: 10; 1 western roof tile line: 40k.pcs/d

10; 40k. pcs/d

Jinjiang

Cizao

Jinjiang Mayunshan Ceramics Co., Ltd.

1 western roof tile line: 10k.pcs/d

10.pcs/d

Jinjiang

Cizao

Fujian Fuxing Ceramics Co., Ltd.

1 western roof tile line: 30k.pcs/d

30k.pcs/d

Jinjiang

Cizao

Jinjiang Xinxing Ceramics Co., Ltd.

1 western roof tile line: 30k.pcs/d

30k.pcs/d

Jinjiang

Cizao

Jinjiang Rishun Building Materials Co., Ltd.

1 western roof tile line: 10k.pcs/d

10k.pcs/d

Jinjiang

Cizao

Jinjiang Tongshan Ceramics Co., Ltd.

1 western roof tile line: 12k.pcs/d

12k.pcs/d

Jinjiang

Cizao

Jinjiang Eric Ceramics Co., Ltd.

1 interior wall tile line: 16

16

1

Jinjiang

Cizao

Jinjiang Baoqiu Building Materials Co., Ltd.

1 small floor tile line: 7

7

1

Jinjiang

Cizao

Jinjiang Honghua Ceramics Co., Ltd.

4 exterior wall tile lines: 40; 3 rustic tile lines: 30

70

7

Jinjiang

Cizao

Jinjiang Hexing Building Materials Co., Ltd.

1 rustic tile line: 11

11

2

Jinjiang

Cizao

Jinjiang Guobang Building Materials Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Quanzhou Shufeiya Ceramics Co., Ltd.

1 western roof tile line: 100k.pcs/d

100k.pcs/d

Jinjiang

Cizao

Jinjiang Xinda Ceramics Co., Ltd.

1 polished glazed tile line: 10; 3 interior wall tile lines: 30

40

7

Jinjiang

Cizao

Jinjiang Haoshan Building Materials Co., Ltd.

3 exterior wall tile lines: 20; 3 polished glazed tile lines: 24; 1 rustic tile line: 16; 1 terracotta panel line: 3

63

5

Jinjiang

Cizao

Jinjiang Aocheng Building Materials Co., Ltd.

2 exterior wall tile lines: 20

20

2

Jinjiang

Cizao

Cizao Taoyuan Building Materials Co., Ltd.

2 exterior wall tile lines: 25

25

1 1

Jinjiang

Cizao

Fujian Xinyuan Group Co., Ltd.

4 exterior wall tile lines: 30

30

Jinjiang

Cizao

Fujian Luchuan Building Materials Co., Ltd.

2 exterior wall tile lines: 18

18

Jinjiang

Cizao

Jinjiang Minyuan Ceramics Co., Ltd.

2 rustic tile lines: 20; 1 western roof tile line: 10k.pcs/d

20; 10k. pcs/d

2

Jinjiang

Cizao

Jinjiang Yifeng Ceramics Co., Ltd.

2 polished crystal tile lines: 4

4

1

Jinjiang

Cizao

Fujian Shushi Ceramics Co., Ltd.

1 rustic tile line: 10

10

1 3

Jinjiang

Cizao

Fujian Zunwei Ceramics Co., Ltd.

2 rustic tile lines: 18

18

Jinjiang

Cizao

Cizao Qiaosheng Building Materials Co., Ltd.

3 exterior wall tile lines: 30

30

Jinjiang

Cizao

Jinjiang Qiaofeng Building Materials Co., Ltd.

4 exterior wall tile lines: 40

40

Jinjiang

Cizao

Jinjiang Cizao Zhuzaikeng Ceramics Co., Ltd.

1 rustic tile line: 8

8

Jinjiang

Cizao

Jinjiang Jinli Building Material Co., Ltd

1 interior wall tile line: 8

8

Jinjiang

Cizao

Jinjiang Guomin Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

52

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AC 18-4

3

www.asianceramics.com



Analysis: China Jinjiang

Cizao

Jinjiang Cizao Huafeng Ceramics Factory

1 western roof tile line: 10k.pcs/d

10k.pcs/d

Jinjiang

Cizao

Jinjiang Fusheng Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 western roof tile line: 100k.pcs/d

10; 100k. pcs/d

1 2

Jinjiang

Cizao

Jinjiang Xiefeng Ceramics Co., Ltd.

2 polished crystal tile lines: 4

4

Jinjiang

Cizao

Fujian Ribao Building Materials Co., Ltd.

71 exterior wall tile line: 10

7

Jinjiang

Cizao

Jinjiang Shanmei Building Materials Co., Ltd.

5 exterior wall tile lines: 40; 2 swimming pool tile lines: 10

50

Jinjiang

Cizao

Jinjiang Huali Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Jinjiang Zhuoyue Ceramic Industry Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Quanzhou Jiyuan Ceramics Co., Ltd.

1 exterior wall tile line: 5

5

1 1

Jinjiang

Cizao

Jinjiang Lianxing Building Materials Co., Ltd.

3 rustic tile lines: 25; 1 exterior wall tile line: 10;

35

4

Jinjiang

Cizao

Jinjiang Tongda Building Material Co., Ltd

2 rustic tile lines: 20

20

2

Jinjiang

Cizao

Jinjiang Jinxing Ceramics Co., Ltd.

2 western roof tile lines: 20k.pcs/d

20k.pcs/d

Jinjiang

Cizao

Fujian Yongqiang Ceramics Co., Ltd.

2 border tile lines: 16; 2 wood finish tile lines: 16

32

Jinjiang

Cizao

Fujian Yanshan Group Co., Ltd.

3 exterior wall tile lines: 30

30

2

Jinjiang

Cizao

Fujian Mingqi Ceramics Co., Ltd.

5 exterior wall tile lines: 50

50

1

Jinjiang

Cizao

Fujian Wanxing Building Materials Co., Ltd.

2 rustic tile lines: 20

20

2

Jinjiang

Cizao

Jinjiang Wanli Group Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Fujian Haojing Ceramics Co., Ltd.

1 small floor tile line: 12

12

Jinjiang

Cizao

Fujian Jiahui Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

1

Jinjiang

Cizao

Jinjiang Qianxing Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

4

Jinjiang

Cizao

Fujian Dongnan Ceramics Co., Ltd.

2 rustic tile lines: 20

20

3

Jinjiang

Cizao

Jinjiang Haopeng Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

Jinjiang

Cizao

Jinjiang Yixing Building Materials Co., Ltd.

1 woodl finish tile line: 12; 2 exterior wall tile lines: 20

32

1

Jinjiang

Cizao

Jinjiang Chenxiang Building Materials Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

1

Jinjiang

Cizao

Jinjiang Cizao Meiling Building Materials Factory

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Jinjiang Minmei New Type Ceramics Co., Ltd.

1 rustic tile line: 10

10

Jinjiang

Cizao

Fujian Hengsheng Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

Jinjiang

Cizao

Jinjiang Xiaohu Ceramics Co., Ltd.

3 exterior wall tile lines: 30

30

Jinjiang

Cizao

Jinjiang Qicai Ceramics Co., Ltd.

3 exterior wall tile lines: 20

20

1 1

Jinjiang

Cizao

Jinjiang Jinzhuang Building Ceramics Co., Ltd.

2 western roof tile lines: 100k.pcs/d

100k.pcs/d

Jinjiang

Cizao

Jinjiang Jiafeng Ceramics Co., Ltd.

1 rustic tile line: 10

10

2

Jinjiang

Cizao

Jinjiang Xinfeng Ceramics Co., Ltd.

1 rustic tile line: 10

10

2

Jinjiang

Cizao

Jinjiang Huachang Ceramics Co., Ltd.

Operation stopped for 2 years

Jinjiang

Cizao

Jinjiang Biquan Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Jinjiang Jincheng Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Cizao

Jinjiang Huixin Building Materials Co., Ltd.

Operation stopped for 2 years

2

Jinjiang

Cizao

Fujian Honghua Group Co., Ltd.

3 rustic tile lines: 22; 1 ceramic panel line: 8

30

7

Jinjiang

Cizao

Jinjiang Huajin Jianhua Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 8

18

2

Jinjiang

Neikeng

Jinjiang Jingtao Ceramics Co., Ltd.

2 unfired tile lines: 30

30

Jinjiang

Neikeng

Jinjiang Hongjia Building Materials Co., Ltd.

2 exterior wall tile lines: 18

18

Jinjiang

Neikeng

Jinjiang Yuanfang Ceramics Co., Ltd.

1 wood finish tile line: 8

8

2

Jinjiang

Neikeng

Jinjiang Pinzhi Ceramics Co., Ltd.

7 rustic tile lines: 56; 3 exterior wall tile lines: 24

80

8

Jinjiang

Neikeng

Jinjiang Guorong Building Materials Co., Ltd.

1 interior wall tile line: 10; 1 exterior wall tile line: 10

20

3

Jinjiang

Neikeng

Jinjiang Yirong Building Materials Co., Ltd.

2 rustic tile lines: 20

20

2

Jinjiang

Neikeng

Jinjiang Xiangfa Ceramics Co., Ltd.

1 interior wall tile line: 10

10

1

Jinjiang

Neikeng

Fujian Jinying Ceramics Co., Ltd.

1 interior wall tile line: 10; 1 exterior wall tile line: 10

20

4

Jinjiang

Neikeng

Jinjiang Ganglong Ceramics Co., Ltd.

2 rustic tile lines: 20

20

2

Jinjiang

Neikeng

Jinjiang Jinzhuang Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

2

Jinjiang

Neikeng

Jinjiang Hongxin Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

1

Jinjiang

Neikeng

Jinjiang Sanfa Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

1 3

Jinjiang

Neikeng

Jinjiang Fengsheng Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 small floor tile line: 10

20

Jinjiang

Neikeng

Jinjiang Kunpeng Ceramics Co., Ltd.

1 exterior wall tile line: 20

20

Jinjiang

Neikeng

Jinjiang Changfeng Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

2

Jinjiang

Neikeng

Jinjiang Pengcheng Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

3

Jinjiang

Neikeng

Jinjiang Zhongrong Ceramics Co., Ltd.

3 rustic tile lines: 24

24

3

Jinjiang

Neikeng

Jinjiang Sinong Building Materials Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

2 3

Jinjiang

Neikeng

Jinjiang Xieshun Ceramics Co., Ltd.

1 rustic tile line: 8; 3 exterior wall tile lines: 30

38

Jinjiang

Neikeng

Jinjiang Haowan Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Neikeng

Jinjiang Cailing Ceramics Co., Ltd.

4 rustic tile lines: 25

25

2

Jinjiang

Neikeng

Jinjiang Demin Ceramics Co., Ltd.

2 polished glazed tile lines: 24

24

2

Jinjiang

Neikeng

Jinjiang Quanlong Building Materials Co., Ltd.

2 rustic tile lines: 18

18

2

Jinjiang

Neikeng

Jinjiang Banzhu Building Materials Co., Ltd.

2 exterior wall tile lines: 20; 2 rustic tile lines: 20

40

2

Jinjiang

Neikeng

Jinjiang Yuele Building Materials Co., Ltd.

1 interior wall tile line: 10

10

1

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Analysis: China Jinjiang

Neikeng

Jinjiang Shengdiya Ceramic Co., Ltd.

1 exterior wall tile line: 15

15

1

Jinjiang

Neikeng

Fujian Huoju Building Materials Co., Ltd.

2 rustic tile lines: 20

20

3

Jinjiang

Neikeng

Quanzhou Lianxing Building Materials Co., Ltd.

1 exterior wall tile line: 10

10

1

Jinjiang

Neikeng

Jinjiang Xingyuan Building Materials Co., Ltd.

1 polished crystal tile line: 2

2

1

Jinjiang

Neikeng

Jinjiang Xianmei Building Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Jinjiang

Neikeng

Jinjiang Xingyuan Ceramics Co., Ltd.

1 rustic tile line: 6

6

1

Jinjiang

Neikeng

Fujian Nanying Ceramics Co., Ltd.

2 polished glazed tile lines: 14; 1 rustic tile line: 7; 1 exterior wall tile line: 10

31

3

Jinjiang

Neikeng

Jinjiang Yongxing Ceramics Co., Ltd.

1 exterior wall tile line: 10;

10

Jinjiang

Zimao

Jinjiang Xielong Ceramics Co., Ltd.

1 split tile line: 10; 5 exterior wall tile lines: 50

60

Jinjiang

Zimao

Jinjiang Zimao Building Ceramics Factory

3 exterior wall tile lines: 30; 1 rustic tile line: 10

40

1

Jinjiang

Anhai

Fujian Tengda Ceramics Co., Ltd. (Antai covered)

9 exterior wall tile lines: 90

90

12

Jinjiang

Anhai

Quanzhou Antai Building Materials Industry Co., Ltd.

6 panel line: 70; 4 exterior wall tile lines: 40

110

Jinjiang

Anhai

Fujian Hengda Ceramics Co., Ltd.

12 exterior wall tile lines: 120

120

2

Nan’an

Guanqiao Town

Quanzhou Caiba Ceramics Co., Ltd.

2 exterior wall tile lines: 20; 2 rustic tile lines: 20

40

2

Nan’an

Guanqiao Town

Quanzhou Yuanlong Building Materials Development Co., Ltd.

2 rustic tile lines: 20

20

2

Nan’an

Guanqiao Town

Quanzhou Yuansong Building Materials Co., Ltd.

2 polished glazed tile lines: 4

4

1

Nan’an

Guanqiao Town

Nan’an Baoda Building Materials Co., Ltd.

2 wood finish tile lines: 16; 1 exterior wall tile line: 10; 2 polished glazed tile lines; 30

56

9

Nan’an

Guanqiao Town

Lihao Group Co., Ltd.

3 rustic tile lines: 35

35

6

Nan’an

Guanqiao Town

Nan’an Taibang Ceramics Co., Ltd.

2 exterior wall tile lines: 30; 1 rustic tile line: 10

40

3

Nan’an

Guanqiao Town

Nan’an Shanchuan Building Materials Co., Ltd.

2 rustic tile lines: 20

30

5

Nan’an

Guanqiao Town

Quanzhou Xinglong Ceramics Co., Ltd.

1 wood finish tile line: 1.5; 1 exterior wall tile line: 15

30

4

Nan’an

Guanqiao Town

Nan’an Badun Building Materials Co., Ltd.

1 split tile line: 10

10

Nan’an

Guanqiao Town

Nan’an Haolian Building Materials Co., Ltd.

3 exterior wall tile lines: 30; 2 rustic tile lines: 20

50

Nan’an

Guanqiao Town

Nan’an Anli Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

2

Nan’an

Guanqiao Town

Nan’an Gangsheng Ceramics Co., Ltd.

2 exterior wall tile lines: 16; 1 rustic tile line: 10

26

1

Nan’an

Guanqiao Town

Nan’an Litai Building Materials Co., Ltd.

2 exterior wall tile lines: 20; 1 rustic tile line: 10

30

1 3

Nan’an

Guanqiao Town

Quanzhou Hesheng Ceramics Co., Ltd.

3 exterior wall tile lines: 30

30

Nan’an

Guanqiao Town

Nan’an Jixing Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

Nan’an

Guanqiao Town

Nan’an Minsheng Ceramics Factory

3 rustic tile lines: 30; 1 wood finish tile line: 12; 2 exterior wall tile lines: 20

62

Nan’an

Guanqiao Town

Quanzhou Daerfu Building Materials Co., Ltd.

1 paving tile line: 10

10

Nan’an

Guanqiao Town

Nan’an Kuoda Building Materials Co., Ltd.

2 exterior wall tile lines: 20; 1 rustic tile line: 10

30

Nan’an

Guanqiao Town

Quanzhou Shenzhoulong Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

13

4

Nan’an

Guanqiao Town

Nan’an Yuanjia Building Materials Co., Ltd.

2 exterior wall tile lines: 20

20

2

Nan’an

Guanqiao Town

Fujian Maoxing Building Materials Development Co., Ltd.

3 rustic tile lines: 24

24

2

Nan’an

Guanqiao Town

Nan’an Jixiang Baoli Building Materials Co., Ltd.

2 exterior wall tile lines: 20

20

Nan’an

Guanqiao Town

Nan’an Yuekai Building Materials Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

Nan’an

Guanqiao Town

Nan’an Jiadi Building Materials Co., Ltd.

2 exterior wall tile lines: 20

20

2

Nan’an

Guanqiao Town

Nan’an Yitiaolong Building Materials Co., Ltd.

1 exterior wall tile line: 10

10

2

Nan’an

Guanqiao Town

Nan’an Guolong Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

1

Nan’an

Guanqiao Town

Nan’an Jiuzhou Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

2

Nan’an

Guanqiao Town

Quanzhou Lixin Building Materials Industry Co., Ltd.

2 rustic tile lines: 20

20

2 4

Nan’an

Guanqiao Town

Nan’an Haohua Industry Co., Ltd.

3 rustic tile lines: 30

30

Nan’an

Guanqiao Town

Nan’an Zhixin Building Materials Industry Co., Ltd.

2 exterior wall tile lines: 24

24

Nan’an

Guanqiao Town

Fujian Qiaoxing Ceramics Development Co., Ltd.

1 rustic tile line: 10

10

1

Nan’an

Guanqiao Town

Nan’an Xiehui Ceramics Co., Ltd.

2 exterior wall tile lines: 40

40

4

Nan’an

Guanqiao Town

Nan’an Yingshan Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Nan’an

Guanqiao Town

Fujian Caisi Ceramics Co., Ltd.

1 interior wall tile line: 20

20

2

Nan’an

Guanqiao Town

Nan’an Guanqiao Tangyi Building Materials Factory

1 rustic tile line: 7

7

1

Nan’an

Guanqiao Town

Nan’an Guanqiao Jinsheng Building Materials Factory

1 exterior wall tile line: 10

10

Nan’an

Guanqiao Town

Nan’an Lepu Art Ceramics Co., Ltd.

1 split tile line: 10

10

Nan’an

Guanqiao Town

Nan’an Xiejin Building Materials Co., Ltd.

3 interior wall tile lines: 22; 2 exterior wall tile lines: 20

42

3

Nan’an

Shuitou Town

Fujian Weixiang Ceramics Co., Ltd.

1 rustic tile line: 8

8

1

Nan’an

Shuitou Town

Quanzhou Hongli Building Materials Co., Ltd.

3 exterior wall tile lines: 20

20

2

Nan’an

Shuitou Town

Nan’an Huajian Ceramics Co., Ltd.

1 exterior wall tile line: 10; 1 rustic tile line: 10

20

4

Nan’an

Shijing Town

Quanzhou Rongda Ceramics Co., Ltd.

3 exterior wall tile lines: 30; 1 rustic tile line: 8

38

4

Fuzhou

Mingqing

Minqing Hengshunda Ceramics Co., Ltd.

1 small floor lines: 10

10

3

Fuzhou

Mingqing

Minqing Red Leaf Ceramic Building Materials Co., Ltd.

1 interior wall tile line: 18

18

3

Fuzhou

Mingqing

Minqing Jincheng Ceramics Co., Ltd.

2 interior wall tile lines: 20

20

7

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Analysis: China

Fuzhou

Mingqing

Minqing Huanyu Ceramics Co., Ltd.

1 interior wall tile line: 18

18

4

Fuzhou

Mingqing

Minqing Zhonglin Ceramics Co., Ltd.

1 interior wall tile line: 16

16

3

Fuzhou

Mingqing

Fuzhou Hengyu Ceramics Co., Ltd.

2 interior wall tile lines: 30

30

Fuzhou

Mingqing

Minqing Fushun Ceramics Co., Ltd.

1 interior wall tile line: 16

16

4

Fuzhou

Mingqing

Minqing Jinyu Ceramics Co., Ltd.

1 small floor lines: 5

5

4

Fuzhou

Mingqing

Minqing Xinglong Ceramics Co., Ltd.

1 interior wall tile line: 5

5

1

Fuzhou

Mingqing

Minqing Dashijie Ceramics Co., Ltd.

1 exterior wall tile line: 12; 1 interior wall tile line: 16

28

4

Fuzhou

Mingqing

Minqing Tenglong Ceramics Co., Ltd.

1 rustic tile line: 18

18

4

Fuzhou

Mingqing

Minqing Oumei Ceramics Co., Ltd.

1 interior wall tile line: 15

15

2

Fuzhou

Mingqing

Minqing Ouya Ceramics Co., Ltd.

2 interior wall tile lines: 22; 1 hexagon tile line; 2

24

5

Fuzhou

Mingqing

Minqing Lantian Ceramics Co., Ltd.

1 rustic tile line: 9

9

3

Fuzhou

Mingqing

Minqing Jiali Ceramics Co., Ltd.

2 interior wall tile lines: 33

33

5

Fuzhou

Mingqing

Minqing Shuangyan Ceramics Co., Ltd.

1 interior wall tile line: 12

12

2

Fuzhou

Mingqing

Minqing Xindongfang Ceramics Co., Ltd.

1 rustic tile line: 20; 1 polished glazed tile line: 11

31

5

Fuzhou

Mingqing

Fuzhou Zhongtao Industrial Co., Ltd.

1 interior wall tile line: 22

22

4

Fuzhou

Mingqing

Minqing Shuangxing Ceramics Co., Ltd.

1 interior wall tile line: 20

20

2

Fuzhou

Mingqing

Minqing Nanhai Ceramics Co., Ltd.

1 interior wall tile line: 20; 1 crystal tile line; 18

38

6

Fuzhou

Mingqing

Minqing Zhongya Ceramics Co., Ltd.

1 rustic tile line: 18

18

3

Fuzhou

Mingqing

Minqing Shenglida Ceramics Co., Ltd.

1 interior wall tile line: 22

22

4

Fuzhou

Mingqing

Minqing Fuxing Ceramics Co., Ltd.

1 interior wall tile line: 24

24

4

Fuzhou

Mingqing

Minqing Nuolixing Ceramics Co., Ltd.

1 exterior wall tile line: 10

10

2

Fuzhou

Mingqing

Minqing Oushang Ceramics Co., Ltd.

1 interior wall tile line: 18

18

4

Fuzhou

Mingqing

Fujian Lianxing Industrial Co., Ltd.

1 polished glazed tile line: 16

16

3

Fuzhou

Mingqing

Minqing Yunfu Ceramics Co., Ltd.

1 interior wall tile line: 25

25

5

Fuzhou

Mingqing

Minqing Xinfeng Ceramics Co., Ltd.

2 interior wall tile lines: 26

26

7

Fuzhou

Mingqing

Minqing Sandeli Ceramics Co., Ltd.

1 interior wall tile line: 35

35

5

Fuzhou

Mingqing

Minqing Gangcheng Ceramics Co., Ltd.

1 interior wall tile line: 15

15

3

Fuzhou

Mingqing

Minqing Jiaxing Ceramics Co., Ltd.

1 interior wall tile line: 15

15

3

Fuzhou

Mingqing

Fuzhou Zhongxin Ceramics Co., Ltd.

1 interior wall tile line: 14

14

3

Fuzhou

Mingqing

Minqing Jiamei Ceramics Co., Ltd.

1 interior wall tile line: 5

5

2

Fuzhou

Mingqing

Minqing Ruimei Ceramics Co., Ltd.

1 small floor tile line: 15

15

3

Fuzhou

Mingqing

Minqing Fuda Ceramics Co., Ltd.

1 small floor tile line: 18; 1 interior wall tile line: 22

40

7

Fuzhou

Mingqing

Minqing Xixi Ceramics Co., LTd.

1 interior wall tile line: 10

10

2

Fuzhou

Mingqing

Minqing Jintao Ceramics Co., Ltd.

1 rustic tile line: 13

13

1

Fuzhou

Mingqing

Minqing Haoye Ceramics Co., Ltd.

3 wall/floor tile lines: 21

21

2 4

Fuzhou

Luoyuan

Fujian Desheng New Building Materils Co., Ltd.

1 rustic tile line: 20; 1 polished glazed tile line: 23

43

Xiamen

Jimei

Tong Long (Xiamen) Ceramic Co., Ltd.

2 rustic tile lines: 10

10

Xiamen

Xiang’an

Xiamen Sanwon Ceramics Ltd.

3 exterior wall tile lines: 20; 1 mosaic line: 0.6; 1 panel line: 2

22.6

3

Zhangzhou

Changtai

Zhangzhou Tianxing Ceramic Industry Co., Ltd.

2 exterior wall tile lines: 21; 1 rustic tile line: 12

33

1

Zhangzhou

Changtai

Fujian Futai Ceramics Co., Ltd.

2 exterior wall tile lines: 20

20

Zhangzhou

Changtai

Fujian Lopo Terracotta Panel Co., Ltd.

2 terracotta panel lines: 8

8

Zhangzhou

Changtai

Fujian Ouman Ceramics Co., Ltd.

1 split tile line: 10

10 32

Zhangzhou

Changtai

Fujian Likai Ceramics Co., Ltd.

1 exterior wall tile line: 12; 2 rustic tile lines: 20

Zhangzhou

Changtai

Zhangzhou Alexandra Terracotta Panel Co., Ltd.

1 terracotta panel line

Zhangzhou

Hua’an

Zhangzhou Yiyuan Ceramics Co., Ltd.

1 western roof tile line: 104k.pcs/d

2 1 1

104k.pcs/d

Zhangzhou

Hua’an

Zhangzhou Xindezhou Ceramics Co., Ltd.

2 polished glazed tile lines: 20

20

4

Zhangzhou

Hua’an

Zhangzhou Jianhua Ceramics Co., Ltd.

2 rustic tile lines: 30; 1 exterior wall tile line: 16

46

6

Zhangzhou

Pinghe

Fujian Meiyi Ceramics Co., Ltd.

2 rustic tile line: 20

20

5

Zhangzhou

Pinghe

Fujian Huacheng Ceramics Co., Ltd.

2 exterior wall tile lines: 18

18

2

Zhangzhou

Pinghe

Zhangzhou Aoli Ceramics Co., Ltd.

4 rustic tile lines: 33

33

4

Zhangzhou

Pinghe

Fujian Pili Ceramics Co., Ltd.

1 rustic tile line: 18

18

2

Zhangzhou

Pinghe

Fujian Hongxing Ceramics Co., Ltd.

7 rustic tile lines: 55

55

7

Zhangzhou

Pinghe

Fujian Qiaofeng Ceramics Co., Ltd.

2 rustic tile lines: 36

36

4

Zhangzhou

Pinghe

Fujian Cailian Ceramics Co., Ltd.

3 rustic tile lines: 27; 2 exterior wall tile lines: 22

49

3

Zhangzhou

Pinghe

Fujian Chaoyou Ceramics Co., Ltd.

1 rustic tile line: 10

10

1

Zhangzhou

Pinghe

Zhangzhou Wanbaoda Ceramics Co., Ltd.

1 cutured tile line: in trial production

Zhangzhou

Nanjing

Fujian Eiffel Ceramics Co., Ltd.

2 rustic tile lines: 3418,000 m2/d

34

4

Zhangzhou

Nanjing

Wanli (China) Solar Science & Technology Co., Ltd.

2 thin panel lines: 17; 1 thick panel line: 6; 3 polished glazed tile lines: 35; 2 rustic tile lines: 24; 3 exterior wall tile ines: 31; water permeable tile line: 3

116

14

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Talking Shop

Talking Shop

Oman Porcelain:

innovation from the front

Asian Ceramics talks to Mr Prafulla Gattani, CEO of rising star, Oman Porcelain about the company’s plans and ambitions now that it has firmly established itself as an innovation leader within the increasingly competitive Middle East market. AC: Could you kindly share details of Oman Porcelain: The biggest challenge in your company’s manufacturing capacity, the region is to find out skilled and trained capabilities and a brief history. What was manpower locally. Since these countries the main mission behind setting up of do not have a very long history of ceramic Oman Porcelain? manufacturing hence, there are not many Oman Porcelain: Currently, Oman Porcelain such Universities and Colleges which can has an installed capacity to produce 2.5 impart such formal education or train human Million square meters of tiles per annum resources for ceramic/ porcelain field .Hence, in its first phase and is in the process of we are largely dependent on acquiring human implementing the second phase of 3.5 resources from various parts of the world. Million square meters per annum capacity. Another bigger challenge in the region is The project was implemented in 2012, finding out suitable raw material for porcelain having first been launched in 2009, with Italian tile production . For ceramics there are a technology. The mission of the promoters few suitable types of clays available but for was to create a state of art manufacturing porcelain by and large such raw materials are Mr Prafulla Gattani, CEO Oman Porcelain facility in Oman for manufacturing porcelain still not available in the region, hence we still tiles. We are proud to proclaim that Oman depend on global sourcing of raw material. Porcelain Co. SAOC is the only company in the Sultanate of Oman With the recent changes in the region there have been some which can produce porcelain Tiles. restrictions for travelling free in GCC countries and new AC: What part of your total production is meant for visas regulations are making travelling little complicated and domestic market. cumbersome, for internal sales in GCC free travel to all GCC Currently, we are selling 60% of our capacity in the domestic member countries should be allowed to increase intra GCC trade market but with expansion it may be reduced to 40%. However, the and partnership. per-capita consumption is growing fast so actual data may differ Challenges for ceramic producers based in other countries in the depending on the time when expansion will be completed. region vary from country to country. However, availability of skilled AC: Which are the main export destinations for your company. and technical workforce is a challenge, which all the GCC ceramic Oman Porcelain: All GCC countries like Bahrain, Qatar, UAE, Saudi producers face in general. To some extent, cheap import of Arabia, Kuwait, etc. are our main customers, besides this we do ceramic tiles from China and India is a major concern for ceramic have our approach in other Arab countries like Lebanon, Jordan, tile producers based in GCC region. Despite, the many advantages Syria, etc. ceramic tile producers enjoy in the GCC region it is difficult to match AC: What are the three largest challenges facing the Omanis the price competitiveness of ceramic tile producers from China and and the Middle East Asian ceramic tile industry. Are these India. Ceramic tile producers based in these two countries enjoy challenges same for the companies across the countries of significant economies of scale and thus are able to produce at very the region? competitive costs.

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Talking Shop

AC: What is the general state of ceramic tile manufacturing in Oman. Could you share the figures of total production, imports and exports from the country? Oman Porcelain: Compared to the size of population of Oman, Oman Porcelain has larger capacity than what is needed for domestic consumption. We already have two plants manufacturing ceramic tiles with a capacity of almost 10 Million Sq.mtrs per annum and one plant manufacturing porcelain tile with a capacity of 2.5 Million Sq. mtrs per annum. Although the population of Oman is approximately 4 Million, the per capita consumption of tiles are very high. Since the consumers are exposed to world market they still prefer imported tiles. In the last two years, cost of imports has not remained at par with domestic supply hence consumption of locally manufactured tiles is growing rapidly. Oman is exporting approximately 3 Million Sq.mtr every year in neighboring countries and also to some part of MENA region, most of it are ceramic tiles and importing almost 2 Million Sq.mtr every year, most of it are porcelain tiles. AC: Natural gas prices are considered to the best advantage for ceramic tile industry in the Middle East. How far this statement is

true in case of Omanis ceramic tile industry and your company. Oman Porcelain: Previously this statement was correct up to a certain extent, when the prices of natural gas were subsidized by various governments in GCC. In past four years this advantage has been revoked and now mostly prices are same or close to global market price. The prices are not much different than other Asian countries like India, Thailand, China and Indonesia. AC: Is a capacity expansion on the cards for Oman Porcelain? Oman Porcelain: Yes indeed, we are in the process of expanding our capacity very soon, hopefully by the mid of 2019, we would be having total 6 Million Sq.mtr capacity per annum. AC: How do you see the ceramic industry in Oman and the Middle East, five years from now? Oman Porcelain: It is a very promising future, there are major events lined up in Middle East like World Expo, 20-20, Football world cup, etc. These will certainly enhance the demand of ceramic & porcelain tiles. The consumers in this region are very well updated and aware of latest trends and products. They also have a very open mind to absorb and adopt any new product very quickly. We are seeing now transition from smaller tile to big sized tiles and

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ADVERTISER FEATURE

Trend Celebrates Two Decades of Great Success conferred on Trend Industrial Ceramics. In March this year, Trend Industrial Ceramics “Moving forward, Trend will continue to keep up with celebrated the 20th anniversary of its foundation in new industry applications and development trends and Beijing, China. In the period since March 1998, Trend supply progressive solutions for kiln furniture, while has progressed rapidly from its initial small investment always researching new materials and expanding of US$60,000 and a 250MT annual capacity to stand application scope,” added Guo Haizhu. “We will also today as the world’s largest manufacturer of cordierite invest more energy in pushing forward with our plan mullite kiln furniture. to research and supply more non-cordierite mullite International cooperation and innovation have been materials with a target in 2028 to truly become the the driving forces behind the development of Trend. world’s largest complete and fully comprehensive Through strategic standardisation, technological kiln furniture manufacturer, offering ‘one source, all exchanges and manufacturing cooperation with solutions’ to our customers.” its partners in the UK and Germany – in addition to The celebration of two decades at the top of its a series of significant financial investments – the game comes amid truly exciting times for Trend. company achieved a level comparable with European “We are currently in the process of constructing an kiln furniture manufacturers. The subsequent growth even more advanced and automated factory (Tianjin means that annual manufacturing capacity is 75 times Trend),” confirmed Guo Haizhu, “which is planned to what it once was, now in excess of 18,500MT. “At the same time as our international collaborative Mr Guo Haizhu, founding director of be completed in August 2018 and which will further Trend Industrial Ceramics increase the company’s total annual capacity to efforts, we made a point of closely following new 32,000MT. This will also enable us to reduce lead times industry developments,” commented Mr Guo Haizhu, and further improve product quality.” founding director of Trend Industrial Ceramics. “We If we look back to those early days in 1998, it’s developed solutions to solve kin furniture applications readily acknowledged that the first chairman of the in the microcrystal, energy and bubble ceramics board, Mr Yu Faming, laid a solid foundation for sectors. Due to our innovative total manufacturing Trend to develop. Alongside him, and as a refractory approach and strong supporting structure, I am materials expert and founder of the company, Guo Haizhu not only proud to say that we are able to manufacture almost all shapes and constantly pushed forward the boundaries of manufacture and sizes of cordierite mullite kiln furniture with the world’s most complete innovation in Trend, but also made a tremendous contribution to product portfolio.” the technological advancement of China’s ceramic industry, gaining Over the past 20 years, Trend has become recognised as the the accolade ‘Outstanding Achievement in the Promotion of China market leader and also lauded as a major contributor in aiding the Ceramics Technology’ from the China Ceramics Association. Over development of the heavy clay, powder metallurgy, microcrystal the years that followed, Brian Dodd from the UK and commercial and and energy sectors in China. The company established itself as a technical partners IPS Ceramics and EmcoTherm have helped to push pioneer in the Chinese and Asian kiln furniture markets. The constant Trend into the international market and, with the help of today’s young striving for improved production techniques was formally recognised management team, everyone at Trend is confident that the future for in May last year when at a special ceremony in Guangzhou the the next 20 years is equally as bright! ‘China Ceramics 30th Anniversary Special Contribution Award’ was

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Talking Shop

ww

w.

se

tec

srl

.it

from ceramic to porcelain in process. In coming five years, I am very sure not only that this market will grow, but also qualitatively there will be a noticeable growth. AC: Which segment/s of tile industry is /are growing more than the Industry average in Oman (for example you have recently launched the Metallica range). How do you see these segments performing in next two/three years? Oman Porcelain: Digitally Printed Porcelain wooden tiles, rustic and metallic tiles are growing very fast. There is a stable demand in traditional marble print market. The demand for full polished glossy porcelain tile will increase for residential projects, however for commercial projects still Matt finish tiles will be preferred choice. AC: Can you share about the technology is use at your production plant. Oman Porcelain: The plant and machineries used by Oman Porcelain CO. SAOC are the most advanced State of Art machineries and the production line has all types of printing facility like digital, Roto or traditional screen printing technology. This plant also has facility to manufacture different kinds of bodies and base. The Oman Porcelain plant is equipped to make very large variation of tiles in terms of size and finish both. Oman Porcelain is using fully automatic Italian plant and machineries which are suitable to provide best outcome and quality products. We are known in the region for latest designs and innovations in designs and Oman Porcelain has bagged the Dossier Construction’s Infrastructure Award 2017 for most innovative manufacturing company. Oman Porcelain Company launched a premium and exclusive range of lavish metallic and large-sized tiles called Metallica and Garnde respectively, at the India Oman Business Meet in Sohar last October. The product lines were unveiled under the auspices of H E Eng Ahmed bin Hassan al Dheeb, Undersecretary of the Ministry of Commerce and Industry, and H E Indra Mani Pandey, Ambassador of India to the sultanate. This was done at a special ceremony that was jointly organised by the Oman Porcelain Company and the Indian Embassy in the presence of Abdul Razak, group chief financial officer, Muscat Overseas Group, Sulaiman al Harthy, Deputy CEO of Meethaq Bank, and Himansu Mohapatra, general manager of Muscat Overseas Group. Renowned architects, builders, delegates and interior designers from across the sultanate were amongst the other attendees of the event. With the launch of the tiles, Oman Porcelain became the first company in the sultanate to introduce an opulent metallic line of tiles made out of metallic glaze (Metallica - 60x60 cm, 30x60cm) as well as large-sized tiles that are available in stone, marble, wood finishes (Garnde - 45x90cm). The large size of the tiles render enhanced continuity to designs, thereby making living spaces appear more spacious.

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www.economick.eu SE.TE.C. Group - SE.TE.C. / VICENTINI / IPEG / COEL Via Enrico Fermi 6/18 • 01033 Civita Castellana (VT) • ITALY

tel. (+39) 0761-540606/(+39) 0761-542141 • fax (+39) 0761-542022 • www.setecsrl.it • info@setecsrl.it

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1 9 5 9 1 6 7 3 5 0

Insight

CHINA Table 1

Number of tile companies by Province

Guangdong Jiangxi Fujian Shandong Henan Sichuan Guangxi Hebei Hubei Liaoning

962 372 537 203 128 224 105 81 114 100

Number of tile lines by Province

Table 1 Guangdong Jiangxi Fujian Shandong Henan Sichuan Guangxi Hebei Hubei Liaoning

Annual capacity of tile lines (m. sq metres, exc. Roof tiles)

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939 462 486 388 256 257 175 127 125 202

Number of inkjet printers

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News

ADVERTISER FEATURE

Sacmi Innovation Lab, Industry 4.0 enabling technology Work continues apace at the facility, which, once at full capacity, will have a team of at least 30 people performing pure research into enabling technologies and new process control systems. Meanwhile, following the success in Italy, a similar project is now being set up in Spain-based Sacmi Iberica Developing innovative know-how and enabling technologies with an eye to Industry 4.0. This, in short, is the mission of Sacmi Innovation Lab, the facility established in 2017 and already selected by the Emilia-Romagna Region as a candidate in the first phase of a tender to attract investment in advanced sectors of the region's industry. But what are 'enabling technologies'? "Those ingredients which, if mixed and configured appropriately, create a competitive advantage for the customer", explains Gildo Bosi, Sacmi's Automation R&D manager. Following successfully completed projects on the Italian market in 2017, further examples now come from Spain where we're looking to replicate the positive Innovation Lab experience and provide the local market with a clear reference point. "Our first project there concerns the development of innovative process control systems", explains Gildo Bosi, "the aim being to improve product quality control by measuring every parameter during the process cycle". From body preparation to firing, ceramic manufacturing involves several stages, each of which makes a crucial contribution to optimal finished product quality (and any potential defects). "On the basis of parameter readings and the long term defects database" explains Sacmi's Automation R&D manager, "it's possible to create models that correlate defects with their upstream causes. This constitutes a valuable tool for operators as it allows them to enhance their understanding of the ceramic process". What's happened, and why. Two apparently simple questions which the models need to answer: a goal based on so-called “data analytics” (i.e. algorithms based on statistical correlations). "This is the first step", observes Gildo Bosi, "towards transforming a traditional ceramic plant into a more evolved smart ceramic plant. Of course, the next step consists of anticipating the causes of any defects by implementing predictive diagnostics models". The aim is to arrive at a point where it is no longer the operator who identifies and corrects the process inefficiency but the plant itself that 'self-corrects' via the models. To this end, Sacmi Innovation Lab doesn't just focus on identifying enabling technologies: it also, and above all, has the task of training the professionals needed to manage such projects and translate them into winning manufacturing strategies. "That task involves distinctly multi-disciplinary skills that range from IT,

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mechanical engineering, physics, and chemistry to mathematics (i.e. data scientists), automation and plant management expertise". And it's this 'managerial' aspect that leads us to the second major project that Sacmi Innovation Lab is moving ahead with at Sacmi Iberica, one that concerns the efficiency enhancement of machine lines. "When we talk about 4.0", explains Gildo Bosi, "the focus isn't merely technological. For example, one of the systems used to transform a traditional ceramic factory into a smart factory involves designing flows and plants innovatively so they reflect the new market logic and provide greater efficiency and economy". That innovation aims to overhaul the way inventories and flows are managed and reorganise order management systems to cope with the increasing fragmentation of the orders themselves (a consequence of increasing product personalisation, shorter life cycles and smaller volumes). "The sum of these two logics", observes Sacmi's Automation R&D manager, "that is, the implementation of new enabling technology and managerial innovation, creates the 4.0 of the future". Several pilot plants installed on the Italian market - with some of the Group's most important customers - follow these new logics. And smart innovation, points out Gildo Bosi, is all the more successful when the technological aptitudes of younger workers are merged with the experience of older ceramists: “New technology is a tool that streamlines people’s work, allowing them to avoid repetitive tasks and dedicate more time to higher-added-value activities. Yet it should always be technology at the service of man, not vice versa. That's why it's essential to implement the digital transition so that it makes the most of the ceramicmaking experience of those who've been with the company a long time". Currently staffed by 15 people, the Sacmi Innovation Lab is expected to grow significantly over the next two years, with employee numbers rising to at least 30. "This is a team dedicated exclusively to research, disengaged from production. It is, in fact, precisely when orders and in-company flows are at their height", concludes Sacmi's Automation R&D manager, "that we need to sharpen the focus on innovation so we're ready to meet the next challenge when it comes along". Operating in close collaboration with Academy 4.0 – the Sacmi facility that oversees 4.0 learning at every level, from internal training to relations with customers, suppliers, schools and universities – Sacmi Innovation Lab aims to become an Emilia-Romagna High Tech Network node by merging the numerous already-completed projects and existing partnerships with the regional research facility and university system. "In 2017 we hosted 5 dissertation students here in Imola. This year's goal is to have at least 6-8 dissertation students assigned to the main facility research areas”.

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157,804 70,788 52,550 48,879 36,221 30,925 19,690 18,240 18,861 20,300

Insight Total employment in tile sector (number of workers)

Total production capacity by tile type ('000 sq metres)

Table 1

Interior wall tile Polished glazed tile Polished tile Rustic tile Exterior wall tile Micro-crystalline tile Large-size panel Other Interior wall tile Polished glazed tile

11944.5 8918.1 8243.5 7483.1 4798.8 124 164 2284.25 11944.5 8918.1

Table 1

ble 1 370,776,272 297,135,549 280,203,585 257,654,539 244,289,240 169,011,531 154,731,359 149,477,660 121,868,814 120,789,855

Top ten ceramic tile export destinations (2017, US$)

Total ceramic exports 2017 (m. tonnes) 2.2 0.97 1.72 1.91 2.2 2.11 2.19 2.3 2.05 1.87 2.09 2.03

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Leading sanitaryware production provinces (no. pieces)

Total ceramic exports 2017 (US$)

Table 1 January February March April May June July August September October November December

1

84,771,948 39,943,792 25,597,659 20,975,292 8,860,175 7,549,040 4,118,767 3,879,123 3,241,387 2,201,619 2,136,085 1,670,333

Henan Guangdong Hebei Hubei Hunan Fujian Jiangxi Guangxi Chongqing Sichuan Shandong Beijing

1,751,211 740,443 1,435,410 1,736,384 1,894,681 1,902,042 1,876,301 1,828,109 1,709,194 1,615,247 1,995,832 2,159,649

1

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Hunter and the hunted

Bitcoin – Schmitcoin. Dear Diary,

lly. I'm not just talking about the 2008 I don't think I'd be alone saying I hate banks & banking genera for – not the banks), I'm talking about nearly financial crash which we are still paying for (we are paying them. with every type of interaction I have to have be paid in cash at work which was rather It started years ago when I first started working – you could to their bank account and so to get directly paid ne everyo quaint but the company wanted to have get an ATM card. Given banking hours were money out I needed to go and physically visit the bank or kindly offered a credit card too. Well within they and card ATM designed for their convenience I got the that credit cards were easy to use. In no a few months I was spending all my wages and finding out bank charged me to tell me what I already The aft. overdr an and time at all, I had a credit card to pay off away from me hardly helped. The hatred of knew – I didn't have any money. Taking money I didn't have okay for a while. were things and m proble banks began. Anyway, I sorted out that well. I moved to Hong Kong and was all – t accoun bank ore Singap a got and as I moved overse I'd be charged unless I kept me telling letter a got I open. wanted to keep the Singapore account d an account with a global, opene I Kong, more money in the account. I closed the account. In Hong accounts, mortgages and joint to ed increas this years the but a local bank. That seemed okay. Over me – I wanted to open a irritated was global savings, then business accounts. But the local bank that bank so it'd be easy to same the with t accoun bank UK local UK company and so wanted a global but in various currencies. trading for t an accoun transfer money. I didn't want to borrow money – I wanted several weeks and took it and though one UK the Not that. My Hong Kong personal account allows the account. open to HQ) n Londo their three interviews (two by telephone with the UK branch and s they would reason y securit for d advise they while a for ts Then when I didn't use one of the accoun 'To Serve find to home my near local branch suspend the account. Back in Hong Kong, I went to the d to advise was I better. me serving wasn't This To...'. Moved You Better This Branch Has Closed And and human real a to speak to r happie we are use online services – which is okay too – but sometimes menu. ons Questi Asked ntly Freque the in red explain something that won't be answe money for drug dealers and so on our Next due to the local but global bank having laundered information within a certain time then our d require the e provid accounts were reviewed – if we didn't wrong but that didn't matter. Then because accounts would be suspended. We hadn't done anything ers used in a certain South Asia custom our bank a and of some corruption issue with our bank other. They didn't tell us – we had to find country the two banks were not communicating with each bank account with another bank. They third a get to had out when L/C's were not completed. We a month. I'm continually dismayed at the told us the approval process would take a few days. It took issues is often totally unhelpful. We with g dealin when igence charges banks make and their intrans have to pay for poor service. needed a line of credit – he had to jump It's not just me – a friends business was growing and he s credit record. Another friend starting a through hoops and put up collateral though he had a spotles trying to have forms completed, signed, limits the to d pushe was new business with overseas investors before the process would have to begin again verified and approved within time limits set by the bank – from scratch. nts? Wouldn't it be nice if there was an alternative to use for payme le and I'm not advertising Bitcoin availab are ies urrenc cryptoc There is. Bitcoin. Please note that other or any other crypto faux currency. when it was first created I heard about Bitcoin a few years ago – certainly not back currency used on the 'dark the was it that heard I when 2012 maybe 009; around 2008/2 too. I was fascinated. illegal less or more things web' for buying illegal drugs and other became the new Bitcoin and years few a d forwar Fast work? money d How could preten

*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

Dutch Tulips. Now back at the beginning of Bitcoin, its value was less than $0.01 the first purchase of two pizz (May 2010) when as (toppings not recorded) was made by Laszlo Hanye Florida for 10,000 Bitcoins. cz in Jacksonville, By February 2011 it was wo rth $1.00 and April 2013 it wa then, though volatile Bitcoin s $266. Since valuation has gone over $10 00 in January 2014 and to $17,900 in December 2017. its record high of It has slid down now to $67 36 as of the time of writing. bought those pizzas that wo (If Laszlo hadn't uld be $67,360,000 now. A lot of pizza indeed, he could toppings as he wanted). have as many In the crazy period of 2017, I had friends on the interne t posting daily graphs showin remarkable gains and its nat g their ural to feel envious of such growth in profit. But those rem are notable by their absenc arkable graphs e when the value drops. I also met people who told me the Bitcoins '..for a few hundred y had bought Dollars' and were now sitting on '...a few thousand.' But the problem – it was easy to set re was a up an account to buy and use value back out in another cur Bitcoins – it was quite anothe rency. There are many rea r to get the sons for this – not only to do that you are the legal owner with proving of the coins but of the regula tions that cover the issuing exchanging virtual currency of money and for rea So why is it interesting to use l currency. Bitc oin or any of the other cryptocur up recently? rencies that have sprung As simply as possible Bitcoin or any other cryptocurrency mathematical formulas tha is mined – by computers doi t occasionally spit out Bitcoin ng complex s as a reward. This started software on their laptops but as people running now requires banks of server s that eat up vast amounts Bitcoins can be transferred of electricity. and the miners earn a fee – all based on maths. So Bitc anywhere and transferred oins can be made between owners at minima l cost. The currency is decentraliz ed. It is said to be democratic Avoiding bank fees, limits and regulation. . No abused every transaction is recorded and this information w to be sure that the system isn't eventually becomes a block, identifiable, each block refe rences the last. Thus there is a chain of blocks of informa each block is details. We have a Blockchai tion of transaction n of data that everyone can see. When you want to use everyone can check you hav your Bitcoins, e the amount you claim and everyone can verify the tran can be transferred, you can saction. The value receive your change; everyo ne has a copy of the transac a private key for your Bitcoin tion. (You have s, the Bitcoins have unique addresses – its considered unfeasible to copy, steal or mathematically abuse the Bitcoins). Once completed, once verified it and the record of it remains cannot be undone forever. A public record. All transparent. That sounds useful for a pay ment system. Whilst the ma thematics of it are quite bey like a viable option – but are ond me it sounds their problems and what is the potential future? There will only ever be 21, 000,000 Bitcoins and at the current rate of creation, the by 2140. y will all be made The problem with using Bitc oins in business relate to sev countries including Banglades eral h & Pakistan to use it. Second issues, firstly it's illegal in some it interesting as an investm ly, it is very volatile in value ent for people that like high which makes risk and high return. Proces are also slow; so there is a sing transactions big risk that the value will cha nge operate more in a 'marginal margin' type industry this doe whilst an order is processed. Given we sn't sound at all positive. It we consider that not many gets worse when places yet actually accept Bitc oin as payment. Bitcoin isn' enough or stable enough to t big enough, fast be of much use to us yet. Co nsider also that it is the big and there have been many gest cryptocurrency cryptocurrencies set up now (Initial Coin Offerings) of wh have already failed. There ich about 50% are few regulations coverin g cryptocurrencies. That is What it is, is a private place not reassuring. where you can store value. Which doesn't solve my pro blem with banks, but that Blo ckchain thing – that secure where all details of transac tions can be kept – surely tha database t is interesting for us? With shipments? regards contracts, Maybe – but that's for next month. 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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