Dyestuff Industry Enters High-quality Development Stage
Year:2018 ISSUE:11
COLUMN:FINE & SPECIALTY
Click:309    DateTime:Jun.08,2018

China Dyestuff Industry Association

High-end demand grows and profitability increases

In 2017, the economics of China's dyestuffs, intermediates and printing & dyeing auxiliaries increased overall. The amount of dyestuffs produced was 1.24 million tons (a YoY increase of 6.9%), including 990 kt dyestuffs, a YoY increase of 6.7%; 246 kt organic pigments, a YoY increase of 4.7%; 363 kt dyestuff intermediates, a YoY increase of 12%. The annual output value of the industry reached RMB 62.1 billion, a YoY increase of 3.8%; sales revenue totaled RMB 59.1 billion, a YoY increase of 11%; and total profits and taxes were RMB 8.9 billion, a YoY increase of 7.2%.
   The pigment dye industry maintained a relatively robust growth despite some raw material prices increasing. Output grew faster than in 2016, based on the steady growth of main-business income. In the context of high cost of raw materials, strict environmental protection policies, basically stable demand, and increasing demand for high-end products, the financial performance of dyestuff firms will improve slightly in the near future.
   According to statistics from the China Dyestuff Industry Association, disperse dyes are output and exported in larger quantities than other major categories of dyestuffs, and their industry concentration is much higher. Reactive dyes, with bright colors, complete chromatograms, simple application, strong adaptability and fastness, have developed into the most important cotton dyes. In addition, the application of reactive dyes has increased, and domestic reactive dyes for wool and silk have replaced some imports, opening up new markets. From statistics and analysis of the past two years, it can be seen that the development of reactive dyes has strong momentum. At the same time, there are many unexploited applications for reactive dyes, and their future is promising. The outputs of various dyes in the past three years are shown in Figure 1.

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Figure 1  Production of dyestuff types, 2015-2017


Better export conditions, & impact from expanding capacities in Southeast Asia

   China's dyestuff export declined in 2014 and 2015 after many years of growth but recovered slightly in 2016. In the first half of 2017, exports dropped slightly, but they started to pick up in the second half, because: 1) global dyestuff production has been increasing in recent years, and both domestic and foreign markets have generally become balanced and saturated; 2) prices fluctuated.
   According to customs statistics, in 2017, China exported 276 kt of dyestuffs, up 5.8% YoY; earned US$ 1.48 billion foreign exchange, an increase of 4.3% year-on-year. The export volume of fluorescent brighteners and printing and dyeing auxiliaries and the amount of foreign exchange earned through export both increased, and the increases were great. The export volume of printing and dyeing auxiliaries increased by 13.3%. Overall, the export situation of the dyestuff industry improved, but there are still many uncertainties, and export will not rebound strongly in 2018.
   Disperse dyes and reactive dyes are the most exported products. In the first half of the year, the percentage of the dyestuff export volume made up of disperse dyes declined; however, in the second half, the trend reversed, mainly because of expanding production capacity for reactive dyes and related intermediates in Southeast Asia in recent years. We can see from the data in Table 1 that the export volumes of most types of dyes were growing, and some even increased greatly.

Table1    Export of dyes, 2017

Type

Export   volume (kg)

YoY change   (%)

Export value   (US$)

YoY change   (%)

Disperse dye

113 569 117

11.5

667 550 817

6.4

Acid dye

15 530 382

-1.0

111 213 100

1.8

Basic dye

13 877 481

3.3

101 743 862

4.2

Direct dye

13 629 641

8.0

49 155 880

10.9

Reactive dye

39 005 121

8.6

222 168 75

-4.4

Vat dye

7 150 313

16.7

84 333 847

14.6

Indigo dye

38 554 086

0.9

177 619 707

5.4

Sulfur dye

5 022 266

3.7

14 899 709

3.6

Sulfur black

29 187 701

-7.8

50 347 182

-0.4

Total dyes

275 526 108

5.8

1 479 032   279

4.3

Organic   pigment

154 505 883

6.7

1 110 526   791

6.1

Fluorescent   brightener

49 852 371

-2.2

165 304 895

7.1

Printing and   dyeing auxiliaries

43 310 982

13.3

79 121 272

3.9


   China’s exported dyes are consumed mainly by Korea, Indonesia, Turkey, and Vietnam. These areas are not only the world’s major consumers of dyestuff but also the major producers, along with China. Although low-cost foreign dyes have not entered China, they do compete with Chinese products in international markets. As domestic dye prices have risen recently, some foreign buyers have turned to those low-priced products.
   Among the top 10 export destinations, South Korea has ranked first for several consecutive years. Exports to Indonesia increased 9% during 2016 but decreased by 8% in 2017. The biggest 2017 growth was in Turkey and Vietnam, respectively by 30.8% and 28.7%. Meanwhile, the volume to India decreased by 8.8%.
   In 2017, organic pigments and products were exported to 147 countries and regions. The top three destinations were still the United States, the Netherlands and Germany. Exports to Germany fell the most by 22.8%, and exports to Japan fell by 3.9%, while exports to Belgium and Vietnam increased by 24.1% and 25.3%.

Reactive & acid dyes are the most imported types, high-end dyes are in short supply

   Reactive dyes and acid dyes were the main imported dyestuff products in 2017: 16 000 tons of reactive dyes, or 41% of the total, and 14 000 tons of acid dyes, or 35.9%. Imported dyes are mainly high-end products. In 2017, the import of sulfur black increased by 40.2% YoY. The import of fluorescent brightening agents decreased by 46.2% YoY, and consumption of foreign exchange increased by 14.5%. The import volume of printing and dyeing auxiliaries increased by 23.6%. It is obvious that China is coping with a domestic shortage of high-end products. See Table 2 for details.

Table 2   Import of dyes, 2017

Type

Import   volume (kg)

YoY change   (%)

Import value   (US$)

YoY change   (%)

Disperse dye

2 170 166

2.5

34 271 659

-3.3

Acid dye

14 081 148

28.5

130 386 849

23.0

Basic dye

1 003 083

12.3

10 874 586

19.2

Direct dye

3 194 099

36.0

17 196 458

9.4

Reactive dye

16 361 355

42.3

133 270 149

18.7

Vat dye

410 248

20.9

7 605 378

24.5

Indigo dye

6 823

-35.5

89 842

-15.2

Sulfur dye

816 023

13.7

3 796 293

13.2

Sulfur black

622 952

40.2

3 075 276

21.4

Total dyes

38 665 897

31.8

340 566 490

17.2

Organic   pigment

19 682 006

16.4

340 821 316

21.6

Fluorescent   brightener

3 300 604

-46.2

27 536 417

14.5

Printing and   dyeing auxiliaries

75 856 530

23.6

250 126 105

15.8


   China imported from 43 countries and regions in 2017, three more than in the previous year, according to customs statistics. India and Taiwan are still the main import origins. Compared with 2016, imports from Germany, Japan, and Indonesia did not grow much, and imports from other countries fluctuated. Imports from the top ten countries and regions totaled 37 000 tons, 95% of the total; the import value reached US$320 million, up 17.1% YoY and 94.1% of the total.

   Organic pigments and products were imported from 50 countries and regions, also three more than in 2016. The volume from India increased 42.9%. The volume imported from the top ten countries and regions was 18 000 tons, an increase of 17.4% YoY, 90.4% of the total; the import value of the top ten countries and regions was US$ 310 million, up 23.4% YoY and 91.2% of the total.
High-quality development in the new ear
   China’s dyestuff industry will likely continue growing steadily in 2018. There is still room for growth in the dyestuff market. At present, the textile and apparel industry in Southeast Asia is expanding rapidly, and the intimately related dye and pigment industry will also develop there.
   At the same time, the development environment of the dye and pigment industry is still not favorable. Many factors such as environmental pressures, increasing labor costs, intensifying market competition, and slowing market demand force dye and pigment companies to accelerate transformation and upgrading, reduce costs, save energy and reduce emission, so as to transform from low-end products to high-end, highly functional and environment-friendly products. So China's dyestuff exports will recover only slowly.