Says a leader of ceramic manufacturers’ association
The country's ceramic industry is facing one of its toughest periods in recent years, as rising production costs driven by persistent energy shortages and weak domestic demand take a toll on manufacturers.
Irfan Uddin, general secretary of the Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA), highlighted the sector's challenges in an interview with The Daily Star.
"The economy isn't doing well, and that's no secret," Irfan said. "The ceramic sector, which depends heavily on real estate and development, is also facing serious difficulties."
He noted that as construction and development activities slow across the country, demand for materials such as ceramic tiles, sanitaryware, and tableware has dropped sharply.
"When development slows, the use of materials like ceramics falls automatically. We've seen industry-wide sales drop by nearly 25 to 30 percent," said Irfan, who is also managing director of FARR Ceramics Ltd.
Tiles, which make up about 80 percent of the market, have been hit hardest. "Because tiles have the biggest share, any downturn affects this segment first. Demand from both residential and commercial projects has fallen significantly," he added.
ENERGY CRISIS HINDERS PRODUCTION AND QUALITY
Although some earlier issues, such as the dollar shortage and import complications, have eased slightly, the ongoing energy crisis remains a major obstacle.
"The gas supply issue has not been resolved. Due to low pressure or interrupted supply, many factories are unable to run at full capacity," Irfan said. "We're currently facing around 15 percent production loss purely due to energy problems."
He explained that an inconsistent gas supply affects both quantity and quality. "Our cost of production is going up because our inputs are the same, but we're producing less. For example, where we used to make 100 pieces, we're now getting just 85 with the same labour force and overhead."
The irregular gas supply also causes firing problems in kilns, leading to lower-quality finishes. "Instead of bright white tiles, we're getting yellowish shades that can't be exported. We're forced to sell them locally at lower margins," he said.
EXPORT POTENTIAL HAMPERED
Despite domestic difficulties, demand for Bangladeshi ceramics remains strong internationally. However, manufacturers are struggling to meet it.
"Buyers are placing orders, but we can't deliver due to our production limits," Irfan said. "We usually aim for 80-85 percent export-quality production, but right now we're only reaching 55 percent."
He stressed that the drop in quality is not due to a lack of skill or workforce, but because of irregular gas supply affecting production temperatures. "We lose a lot of revenue because products that don't meet export standards have to be sold locally," he lamented.
To support the struggling industry, BCMEA has launched initiatives targeting both local and international stakeholders.
"In the last three days, over 22,000 people visited our industry exhibition," Irfan said. "We also held a special programme with all of Bangladesh's major ceramic distributors. The response has been very positive."
"These efforts aim to keep distributors and stakeholders engaged despite the downturn," he added. "Distributors are key to reaching the local market, so keeping them motivated is crucial."
FINANCIAL STRAIN AND INVESTMENT GAPS
The prolonged slowdown has put heavy financial pressure on ceramic makers. "Many companies are struggling to cover everyday costs like salaries and loan payments," Irfan said. "No one invests expecting to fail. When someone builds a factory with Tk 150 crore-Tk 200 crore, much of it comes from their own savings."
He also pointed to the lack of fresh investment. "We're not seeing new investment at the moment. Even local investors are holding back, and foreign investors are absent. Without fresh investment, economic growth will remain slow."
Irfan urged the government to ensure political and economic stability. "A functioning, elected government must take charge and steer the economy forward," he said.
He highlighted that the mid-range market, which forms the largest customer base, has been hit hardest. "The premium market is smaller, and while it's affected too, the volume loss is much larger in the middle-income bracket," he said.
As household and project budgets tighten, mid-segment consumers are delaying or reducing construction and renovation, directly impacting ceramic sales, he added.
Irfan urged the government to stabilise gas supply and provide targeted support to export-focused sectors like ceramics. "If we can stabilise gas supply and restore investor confidence, the industry can bounce back," he concluded.
