Gujarat exports raw material for dyes to China.

Ahmedabad: The Chinese authorities' crackdown on chemical makers continues to benefit the dyes and intermediates industry in Gujarat. In a sort of reversal, chemical companies from the state have been able to export vinyl sulphone to China. Traditionally, this key intermediate for making various types of dyes used to be imported from China on a regular basis.

"Over the last year, we have exported 1,000 tonnes of vinyl sulphone to China. This is the first time such a large quantity has been exported to our rival country in the chemical sector," said Bhupendra Patel, the newly appointed president of Gujarat Dyestuff Manufacturers' Association (GDMA).

China is currently facing a shortage of this intermediate, following the closure of a large plant there. Globally, only 10,000 tonnes of this key raw material is produced every month. China produces 6,000 tonnes and India, especially Gujarat, contributes 4,000 tonnes. Of the total vinyl sulphone produced in China, its domestic dye makers consume 5,000 tonnes. The rest was exported to India.

"The shutting down of the Hubei Chuyuan plant created a shortage of 3,000 tonnes. As, we had the capacity, our companies exported vinyl sulphone to China. Although the local market price is Rs 350 to Rs 360 per kg, exports have been done at the rate of Rs 400 per kg, which signals a demand for our product," added Shanker Patel, past president, GDMA.

Most Indian companies in the chemical sector, especially those dealing in intermediates and dyes, have largely benefitted from the short supply created by lower production in China, following implementation of more strict environment laws. In March 2016, Chinese chemical giant Hubei Chuyuan was shut down over environmental concerns. This led to a spur in demand for dye intermediates, pushing up their prices. The company had a 30% share in the global chemical intermediates and dyestuffs market. Earlier, H-acid, another intermediate chemical used for making dyes, saw a spike in prices.

India's dyes and intermediates industry turnover is Rs 20,000 crore per annum. Around 4.53 lakh metric tonnes of dyes and dye intermediates worth Rs 13,601 crore were exported in 2015-16 and Gujarat accounted for 60% of the exports.

Source : timesofindia.indiatimes.com