| World demand for dyes and organic pigments to touch | | | | The spreading of these units is slanted towards the |
| $10.6 billion in 2008 | | | | western region (Maharashtra and Gujarat) accounting |
| According to a study on dyes & organic pigments, | | | | to 90 per cent. In fact, about 80 per cent of the total |
| the worldwide demand for organic colourants (dyes | | | | capacity is in the state of Gujarat, where there are |
| and organic pigments) is projected to increase at $10.6 | | | | about 750 units. |
| billion in 2008 form 4.9 per cent annually in 2003. | | | | There has been a huge development in the dyestuff |
| Generally, the dyestuff industry comprises three | | | | industry during the last decade. This has happened due |
| sub-segments, namely dyes, pigment and | | | | to the Government's concessions (excise and tax |
| intermediates. The dye intermediates are petroleum | | | | concessions) to small-scale units and export |
| downstream products which are further processed | | | | opportunities generated by the closure of several units |
| into finished dyes and pigments. These are important | | | | in countries like the USA and Europe (due to the |
| sources in major industries like textiles, plastics, paints, | | | | implementation of strict pollution control norms). The |
| paper and printing inks, leather, packaging sector etc. | | | | duty concessions provided to small-scale producers |
| Leading players in dyes | | | | had given in the large ones becoming uncompetitive to |
| Textile dyes have been used since the Bronze Age. | | | | some extent. Price competition was strong in the |
| They also constitute a prototype 21st-century specialty | | | | lower segments of the market. Liberalisation of the |
| chemicals market. Three large manufacturers namely | | | | economy and large-scale reduction of duties have |
| DyStar, Ciba Specialty Chemicals and Clariant are | | | | given the decrement of margins for smaller producers. |
| leaders in the dyes market. The biggest, DyStar, was | | | | Closing of many small-scale units in Gujarat due to |
| established in a series of mergers of some of | | | | environmental reasons has also helped the organised |
| Europe's leading textile dye businesses in the 1990s. | | | | sector players to grow further. |
| Worldwide excess capacity and price burden, fueled | | | | Over six hundred varieties of dyes and organic |
| by the immediate growth of Asian manufacturers, | | | | pigments are now being produced in India (both by the |
| have shifted most dyestuff chemistries into | | | | organised and the unorganised sector). But the |
| commodities. Regulatory barriers have nearly stopped | | | | per-capita consumption of dyestuffs is less than the |
| the progress of the opening of fundamentally new | | | | world average. Dyes are soluble and basically applied |
| dyestuffs. Despite this DyStar, Ciba Specialty | | | | textile products. Pigments, on the other hand, are |
| Chemicals and Clariant have grown over the past 10 | | | | insoluble and are main sources of products such as |
| years with innovative products and new chemistry is | | | | paints. |
| being set to endure reactive and dispersant dyes as | | | | During the past few years, the dyestuff industry was |
| well as in older dyestuffs such as sulfur dyes. | | | | overwhelmed by a series of fast changing upshots in |
| In 2001 the biggest individual company market shares in | | | | the international platform. The largest market for |
| colourant production were DyStar (23%), Ciba (14%), | | | | dyestuffs has been the textile industry. The hold of |
| Clariant (7%), Yorkshire Group (5%), Japanese (5%) | | | | polyester and cotton in the global markets has |
| and other traditional groups (3%)., and various dyestuff | | | | positively created the demand for some kinds of |
| manufacturers comprise the largest group at 43%. | | | | dyestuffs. Furthermore, the demand for polyamides, |
| The only way to growth and to keep Asian bulk | | | | acrylics, cellulose and wool has been close to stagnant. |
| dyestuff manufacturers at bay, they say, comes | | | | Discrepancy in the regional growth rates of textile |
| straight out of specialty chemicals strategy to | | | | products too influences demand. The Asian region has |
| distinguish product offerings through collaborative work | | | | seen the highest development in textile production, |
| with customers and charge a premium price for | | | | followed by North America, Latin America and |
| particular products that gives a perfect solution. This is | | | | Western Europe. This shows the change in the global |
| an effective method, provided that these suppliers | | | | textile industry towards Asia. Subsequently, Asia |
| produce in China, India, Pakistan, and Brazil as well as in | | | | offers dyestuff production both in terms of volumes |
| the U.S. and Europe, and that most of the textile | | | | and value, with about a 42 per cent share of the global |
| producers aim to maintain uniform quality and product | | | | production; the US is next with 24 per cent and Europe |
| performance across worldwide. | | | | has around 22 per cent. Due to a wide use of |
| Europe is facing the problem of overcapacity of about | | | | polyester and cotton-based fabrics, there has been a |
| 30 to 40 per cent in the market from Asia, especially | | | | change towards reactive dyes, applied in cotton-based |
| China. But, experts believe, Asian manufacturers | | | | fabrics, and disperses dyes used in polyester. These |
| manufacture a limited number of low-cost, basic | | | | two dyes have been leading in all the three regional |
| dyestuffs. Most of experts of this field believe that | | | | global market, particularly Asia. Moreover, the change in |
| growth lies in innovation and differentiation. Though, of | | | | textile application pattern and regional developments is |
| the 180,000-ton-per-year worldwide market for | | | | the amount of over capacity in the global dyestuff |
| dispersed dyes, specialty dyes consist only about | | | | industry. |
| 5,000 tons. | | | | Within India, the leading producers in the pigments |
| DyStar is a major manufacturer of reactive dyes, | | | | industry are Colour Chem and Sudarshan Chemicals |
| which were developed 50 years ago at ICI. DyStar | | | | while in the dyestuff industry the major players in |
| was recently purchased by Platinum Equity, is made up | | | | terms of market share are Atul, Clariant India, Dystar, |
| of the dyes business of the original ICI, as well as | | | | Ciba Specialities and IDI. The Indian companies together |
| those of Bayer, BASF and Hoechst. DyStar has | | | | account for nearly 6 per cent of the world production. |
| developed deep-shade dyes for polyesters. New | | | | Almost 80 per cent of the dyestuffs are commodities. |
| chemistries are emerging for controlling staining from | | | | Since not much technology is used, copying of |
| azo and anthraquinone dyes, including thiophene-based | | | | products is also easy as compared to specialties. |
| azo dyes. DyStar has also developed | | | | Though in the recent past, there have been efforts by |
| benzodifuranone dyes for heavy red shades. It | | | | global producers, with some achievement, to shift to |
| modified azo dyes to keep up their performance when | | | | the specialty end of the product profile. Vat dyes have |
| applied with the new detergents. The company also | | | | always performed as specialty products, with |
| set up secrecy agreements with the leading detergent | | | | technology working as a vital function. Now companies |
| producers to test new detergent chemistry and do the | | | | are focusing on the higher end of the reactive dyes |
| required dye reformulation proactively. It has added the | | | | segment. The inclination is now changing from |
| number of reactive groups in its fluoroaromatic Levafix | | | | supplying mere products to colour package solutions. |
| CA reactive dyes. The company has also been | | | | More importance is given to innovation, production |
| functioning on strengthening the chromophore or color | | | | range, quality and environmental friendly products. |
| component of the dye for improved lightfastness. | | | | Manufacturers are collaborating with equipment |
| Recently, DyStar has made new red dye for cellulosic | | | | producers to offer integrated solutions rather than |
| fibers, Indanthren Deep Red C-FR Plus, is a new | | | | products. |
| speciality dye for medium to heavy shades of red and | | | | Fiscal policies and modification in the application pattern |
| Bordeaux, suitable for the coloration of cellulosics on | | | | of the global dyestuff industry have revolutionized the |
| continuous and yarn dyeing units as well as cellulosic | | | | market shares of Indian companies. Excise |
| polyamide blends. DyStar Textilfarben GmbH has also | | | | concessions for the small-scale sector in the mid and |
| introduced the classic cold pad batch dyeing process | | | | the late 1980s generated many units in Maharashtra |
| (cpb). Key developments in cold pad batch technology | | | | and Gujarat. At one point of time, there were in the |
| were started in 1957 and are still ongoing: | | | | unorganised sector nearly 1,000 units, with most of |
| -Development of dosing pumps (Hoechst) | | | | them situated in Gujarat and Maharashtra. |
| - Introduction of sodium silicate as a fixing alkali | | | | Though, since the early 1990s, there has been seen an |
| (Hoechst) | | | | ongoing decrement in the excise duty rates applicable |
| - Development of microwave and oven lab fixation | | | | to the organised sector. From 25 per cent in 1993-94, |
| method (Hoechst) | | | | the excise duty rates were decreased to 20 per cent |
| - Mathematical determination of pad liquor stability | | | | in 1994-95, and 18 per cent in 1997-98 and further |
| under practical conditions (Hoechst) --- | | | | decreased these rates to 16 per cent. |
| Optidye CR (DyStar) | | | | This continuing decrement in the duty rates |
| - Development of silicate free alkali systems (DyStar) | | | | smoothened the competitive edge of the unorganised |
| The dyestuffs industry of China | | | | sector. The organised sector, with high product range, |
| In the first half of 2005, China gained a growth of 4 | | | | technology and marketing reach was capable to raise |
| per cent in dyes and 11 per cent in organic pigment | | | | its market share. But more noteworthy changes have |
| output. A report stated that China's demand for dyes | | | | gained through the German ban on many dyestuffs, |
| and pigments is expected to increase at 12 per cent | | | | enforced to the local pollution control laws. While the |
| annually by 2008 and output of dyes and pigments will | | | | organised sector has been capable to regulating the |
| rise by 13 per cent annually by 2008. | | | | manufacturing of dyes based on the 20 banned |
| According to statistics, in 2004, the production volume | | | | amines by the German legislation, many in the |
| of dyeing stuffs and pigments in China reached | | | | unorganised sector were moved out. This was |
| 598,300 tons and 143,600 tons, an increment of 10.4 | | | | amalgam by the local pollution laws, which need to |
| per cent and 13.3 per cent over that of the previous | | | | establish the effluent treatment plants, and drive out |
| year. The total imports and exports of dyeing stuffs | | | | companies in the unorganised sector. |
| and pigments were projected to be 291,200 tons and | | | | The capacity and production of dyes and dye stuff |
| 138,800 tons; an increase of 10.64 per cent and 16.15 | | | | was 54,000 MT and 26,000 MT respectively in the |
| per cent over the same time the previous year. Hence, | | | | year 2003-04. The capacity and production of dyes |
| China has developed to be a large manufacturer, | | | | and dye stuff was 54,000 MT and 26,000 MT |
| consumer and dealer of dyeing materials, pigments | | | | correspondingly in the year 2003-04. The small scale |
| and dyeing auxiliary. | | | | units offer major share in dyestuff production while |
| China becomes top importer for Bangladesh | | | | large units focus producing dyestuff intermediates. |
| During July-September 2005 Bangladesh imported | | | | Disperse and Reactive dyes represent the greatest |
| dyes and chemical (combined) worth 3.73 billion taka | | | | product segments in the country covering about 45 |
| ($57.5 million) from China against 2.53 billion taka ($38.9 | | | | per cent of dyestuff consumption. In the coming time, |
| million) from India. | | | | both these segments will lead the dyestuff market |
| DyStar expands China facility | | | | with disperse dyes possibly to have the greatest |
| Recently DyStar has announced to invest around USD | | | | contribution followed by reactive dyes. These two |
| 55 million in a new textile dyes facility at Nanjing to | | | | segments will hold a greatest share in order to lead |
| extend its production base in China and step up its | | | | textile and synthetic fibers in dyestuff consumption. |
| focus on this key growth market. Situated about 300 | | | | Vat segment is also projected to prove healthy |
| kilometres north-west of Shanghai, Nanjing is the | | | | growth in future. |
| capital of Jiangsu Province, a key area for textile | | | | Exports and Import of Dyestuffs |
| production. It will be DyStar's third production unit in | | | | In the year 2004-2005 the exports of dyestuff industry |
| China, alongside Wuxi, where the production capacity | | | | has touched 1109 million US dollar. Exports of dyestuffs |
| was tripled last year, and Qingdao. This new | | | | in the year 2000-01 reached to about Rs. 2365 crores |
| production site will increase their growth in China. At | | | | and accounted to about 5 per cent of the total world |
| the same time it will strengthen their international | | | | trade of dyestuffs. The main markets for Indian |
| competitiveness and boost market leadership. This | | | | dyestuffs are the European Union, U.S.A., Indonesia, |
| investment is a clear sign that DyStar is continuing to | | | | Hong Kong, South Korea and Egypt. The following |
| invest in its core business and will remain a reliable | | | | table provides data export and import of dyestuff |
| partner for the textile industry in the long term. | | | | during last few years. |
| At the new production complex in Nanjing, DyStar will | | | | Technology |
| produce dyes for cellulosic and synthetic fibres. In-built | | | | The technology for dyestuff production changes |
| flexibility will permit the manufacture of other dyes and | | | | largely from relatively simple (direct azo) to |
| extension of the infrastructure in line with requirements. | | | | sophisticated (disperse and vat) dyes. Despite the fact |
| That means DyStar will be able to respond quickly to | | | | that technology is locally available, most of it is out |
| the rising demand in China. The inauguration of the first | | | | dated. The setback is further compounded by the fact |
| plant is scheduled in the first half of 2006. | | | | that the nature of the process differs from batch to |
| Indian dyestuff industry | | | | batch and, hence, managing the process parameters |
| In India the dyestuff industry supplies its majority of the | | | | becomes complex. |
| production to the textile industry. Huge of amounts | | | | The dyestuff industry is one of the largely polluting |
| exports of dyes and pigments from India are also | | | | industries and this has lead to them closing down |
| done to the textile industry in Europe, South East Asia | | | | internationally or changing the units to the emerging |
| and Taiwan. | | | | economies. Majority of the international producers |
| Currently, the Indian dyestuff industry is completely | | | | have shifted the technology to developing nations like |
| self-dependable for producing the products locally. India | | | | China, India, Indonesia, Korea, Taiwan and Thailand. This |
| presently manufactures all kinds of synthetic dyestuffs | | | | shift of manufacturing capacities is because the |
| and intermediates and has its strong holds in the | | | | industry is supposed to work as a high-cost and low |
| natural dyestuff market. India has come up as a global | | | | return one. The batch processing also formulates it to |
| supplier of dyestuffs and dye intermediates, mainly for | | | | a labour- intensive industry. Hence, the competitiveness |
| reactive, acid, vat and direct dyes. India has a share of | | | | of developing economies gets a boosts. |
| approximately 6 per cent of the world production in | | | | Though, in the past decade the Indian industry has |
| dyestuff products. | | | | made considerable development in terms of |
| Structure of dyestuff industry in India | | | | technology and production. |
| The Indian dyestuff industry has been in existence | | | | Restructuring |
| since about 40 years, though a few MNCs established | | | | Restructuring of the Indian dyestuff industry which |
| dyestuff units in the pre independence era. Like the | | | | started a couple of years ago is still in progress. The |
| other chemical industry, the dyestuff industry is also | | | | movement was initiated by the market leader |
| widely scattered. The industry is functioning by the | | | | Colour-Chem Ltd. It has also come into a toll |
| co-existence of a few manufacturers in the organised | | | | manufacturing agreement with Dystar India Ltd. There |
| sector (around 50 units) and a large number of small | | | | have been other arrangements, which would give |
| producers (around 1,000 units) in the unorganised | | | | improving capacity utilisation at manufacturing facilities |
| sector. | | | | and also to have better exposure of export markets. |