The chemical dyestuff industry of Gujarat is finding it hard to bag new orders as prices of basic raw materials intermediates have increased more than double in past few months. Industry insiders claim shutting down of some units in China and Europe due to pollution issues has resulted in an unprecedented rise in prices of basic raw materials in international markets. “Gujarat is the hub of chemical dyestuff manufacturing with about 70% share in production. In recent times, prices of basic raw materials of dyestuff have gone up by more than double and because of this small and medium units are not getting new orders,” said Bhupendra Patel, president of Gujarat Dyestuffs Manufacturers Association (GDMA). Prices of materials such as acetic anhydride have shot up from Rs 65 to Rs 175 per kg, sodium bicarbonate prices have increased Rs 27 from Rs 20 a kg and caustic soda flakes have moved up to Rs 50 from Rs 38 per kg in past one month. Prices of beta naphthol, J acid, H acid, vinyl sulphone, gamma acid and tobias acid moved up by 15-30% in past two months.
GDMA has urged the Union government to interfere to control prices. It is difficult to do a business for small players in this condition. Patel said, “The price rise is completely unexpected and it is challenging to do a business for small units in this condition. We have urged the central government to intervene to control the prices.”
Gujarat has over 1,100 dyestuff producers units and of it 80% are small scale unit. The industry turnover is pegged at Rs 25,000 annually. According to the industry sources, with the price increase, most units are finding it difficult to manage the production costs. As the prices of basic raw materials soared, the production costs of dyestuff has increased by 15-20%. The industry fears that this will affect the competitiveness of India in global market and this will fall exports from the country.