Ahmedabad: Lack of containers and high sea shipping costs have begun to pinch ceramic tile manufacturers in Morbi, the largest ceramic industry cluster in India.
The twin punch has eroded export, and exporter is afraid of more losses because the new order dries.
Sea cargun has soared two to three times in recent months and tile makers do not get containers in the numbers needed to make delivery.
It has reached exports from Morbi up to 20-40%, industrial players said.
“Ceramic tile exports fell 40% because of the high level of delivery and lack of containers,” said Mukesh Uughreja, President, Vitrified Tile Division, Morbi Ceramic Association.
Exports contributed 30% of Rs 45,000 Crore worth ceramic tile production in Morbi.
The decline in exports at 20%, Kg Kundariya, chairman of Ceramics Wintel Ceramics based in Morbi Limited, added that export provides a very needed breathing room for ceramic tile makers when domestic demand slows down due to Covid-19 pandemic.
“The breathing room is gone now,” he said.
Even after making provisions for exorbitant delivery, exporters cannot manage containers on time.
Therefore, exporters do not get new orders.
“Reservations of new orders from the export market have been exposed to lack of containers.
Manufacturers cannot load shares lying in warehouses due to lack of containers.
The cost also rises due to a surge in shipping level,” added Nilesh Jetpariya, President, Wall Tiles Division, Morby Keramics Association (MCA).
Ceramic tile makers say that countries like Italy and Spain will get from an unfavorable Indian situation.
While export shrinks, Domestic OFFTAKE is also affected because tile makers are trying to continue the increase in production costs by raising prices.
“To ensure that there is no advantage of supply in the market and the existing stock items are absorbed at the desired price level, ceramic tile makers for a while to turn off their plants,” Jetpariya added.
So far 115 tile manufacturing units have stopped production and 250 more will stop production for a month from September 1, the ceramic tile industry player said.