Above 50 export destinations, Tk5,500cr domestic market
Ceramics industry has turned into a booming manufacturing sector in Bangladesh over the years, cashing in on growing demand both in domestic and international markets.
Since 1958, this sector has flourished tremendously and in last ten years the total ceramic industry’s production growth rose by almost 200%.
At present the industry caters to 85% of local demands while because of high quality, ceramic products of Bangladesh have huge demand in international markets as well.
According to Bangladesh Ceramics Manufacturers and Exporters Association (BCMEA), a total of 66 ceramic manufactures are operating in the country, producing mainly tableware, tiles and sanitary ware.
Of these factories, 20 are making tableware, 28 tiles, while 18 are producing sanitary ware. Investment of all the factories amounts to a total of Tk8,616 crore, while about 50,000 people are directly involved in the industry.
Speaking to Dhaka Tribune, Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA) President Shirajul Islam Mollah said that ceramic industry was a highly potential and labour intensive sector.
The yearly production capacity of the local ceramics industry is 25 crore pieces tableware, 20 crore square metre tiles and 90 lakh pieces of sanitary ware and value addition in ceramics stands at 65%.
As per BCMEA data, total domestic market consumption of ceramic products was around Tk5,450 crore in FY2017-18, of which locally produced ceramic products were worth nearly Tk4,340 crore, while imports hit Tk1,110 crore.
In case of tableware, a 92.87% market demand is met with locally produced goods, while the remaining 7.13% with imported products.
As regards tiles, local companies occupy 76.18% of the total market share and imported products hold the rest 23.82% while 88.32% market demand of sanitary ware is met with locally produced products and the rest 11.68% with imported goods.
According to the data of Export Promotion Bureau (EPB), the industry earned more than $45.74 million through export in 2017-18 fiscal year (FY), which was $35.57 million in 2016-17 FY, and $35.32 million in 2015-16 FY.
Of different ceramic products, tableware is exported to more than 50 countries including the US, Canada, European Union countries and Australia; tiles to India, Nepal and Bhutan; and sanitary ware to the Middle East, especially to the UAE.
Irfan Uddin, general secretary of Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA), said product diversification with competitive prices helped the sector boost its exports.
“In our country, almost every ceramics industries maintains the international quality of their products and that’s why we have a big international market of our products. Specially, our tableware accounts for more than 90 percent of Bangladesh's ceramics export," he added.
Companies' share of yearly turnover
Of the local market, Shinepukur Ceramics holds the highest 18% share, Monno Ceramics 15%, Farr Ceramics14%, Paragon Ceramics 12% and Protik Ceramics has 8% share in the local market.
In international market, Bangladeshis ceramics companies have competitive places as Shinepukur and Farr ceramics both hold the first position with 24% export market sharing.
Paragon holds the second position with 18% share, Monno 10% and Artisan has 8% share in the export market.
Regarding the sanitary ware products, RAK ceramics has the large market share of 33% while Abul Khair Ceramics holds 18% share and Excellent ceramics 7% in the local market.
In case of tiles market share, RAK ceramics and Star ceramics have taken the leading position as both have 15% share in the total tiles market. Besides, Great Wall ceramics, Akij and Mir ceramics have 14%, 11% , and 8% market shares respectively.
Problems and possibilities
Sector insiders mention gas supply as the main challenge facing the local ceramics industry. Comparatively high import duty on raw materials is another challenge for the sector.
Irfan Uddin, also managing director of Farr Ceramics, said the industry got government support in many ways but still inadequate supply of natural gas was one of the major challenges for its growth.
“Natural gas is not only the key energy source for the industry but also crucial for maintaining quality of the products,” he said.
The managing director of Farr Ceramics also mentioned heavy dependence on imported raw materials as another challenge for the ceramic products in Bangladesh.
“If the government reduces supplementary duty as well as advance income tax on import of these raw materials, this sector will reach its expected goal," he added.
In 1977, government organization Bangladesh Insulator and Sanitary Ware Factory Ltd (BISF) started making ceramic tiles and sanitary products in the country. In 1993, Madhumati Ceramics privately invested in this sector.
Local company Monno Ceramics started producing ceramic products for the first time in the country in 1985. Later foreign companies came forward to invest in the sector. The UAE invested in RAK Ceramics (1998) while Lebanese-Bangladesh joint venture Star Ceramics Ltd (2015) and several Chinese manufacturers came in the sector.