Ahmedabad: The price of spiraling coal has pushed the price of basic raw materials used to make dyes and coloring.
Expensive coal along with the reduction of imports from China has led to dyes and raw substances of raw dyes of a 50 percent surge up to 400 percent during the April-October period.
With coal prices increased almost twice over a six-month period and an increase in the consequences of the cost of basic chemicals, dyes and intermediaries makers have downsizing production with an estimated 80 percent, according to the association of Dyestuff producer (GDMA) Gujarat, as their production costs have risen.
Coal prices have increased by 191 percent over the past six months.
Chemicals include aniline, anhydride acetate, naphthalene, sulfuric acid, h-acid, J-acid, k-acid and vinyl sulphone, among others, which are used for manufacturing dyes and intermediaries to be more expensive in the range of 50-400 percent.
Coal plays an important role in processing and chemical production.
Chemical factories use boilers to produce these raw materials, which are used in making dyes and intermediates.
While gas and electrical boilers are also used to make these raw materials, coal-fueled boilers are largely used by manufacturing units because the price is effective compared to gas or electrical boilers.
“The price of basic raw materials has risen substantially due to a steep coal price surge.
High coal prices have increased factory production costs that produce basic raw materials for dyes and substances between.
Reduction of supply from China further added to pressure,” said Bhupendra Patel, Chairperson, Gujarat Region, Basic Chemicals, Cosmetic Export Boards & Dyes (Chemexcil).
“As a result, coloring producers are forced to raise the price of finished products they produce using this basic raw material,” Patel added.
Dyes and intermediaries of makers also depend on imported chemicals from China.
“Power outages in China and consequently turn off production have caused 25 percent of short supply of several basic chemicals.
Supply constraints to high demand are also responsible for raw material prices to rise,” said Natubhai Patel, Managing Director, Meghmani Organics, who produced materials this chemical.
Climbing in raw material prices comes at the time of gas costs, plastic packaging materials and even shipping costs high because MSMEs face terrible working capital constraints.
This has forced a decorative dye and intermediary to reduce production.
“Color substance producers almost do not utilize 20 percent of their installed capacity is that producers cannot absorb dramatic increases in production costs, which have increased at least 50 percent.
Our clients refuse to bear the increase in the cost of dying and intermediaries and therefore, we are only quite producing To fulfill the existing commitment, “said Yogesh Parikh, President, GDMA.