Product Profile – Ceramic Tiles

HS CODE of Ceramic Tiles is: 6907

Tariff Line of Vitrified Tiles (Polished/Unpolished): 69079010

• Global vitrified tiles market is currently estimated at US$ 56.6 billion and is projected to reach US$ 87.8 billion by 2026, burgeoning at a CAGR of 7.7% during the said forecast period.

• World’s exports of ceramic tiles surged from US$ 5.4 billion to US$ 17.9 billion from 2012 to 2018. This gives a growth rate of 20.6% per annum calculated at exponential rate.

• India is among the top exporter of ceramic tiles in the world. Within a span of past three years, India’s exports of ceramic tiles surged by more than US$ 800 million.

• Tax rates were revised from 28% to 18%, under GST slabs, which led to a decrease in the cost of finished ceramic tiles products. The decrease in price has led to an increase in the sales of the product, thereby leading to the overall growth of the industry.

Introduction

Global vitrified tiles market is currently estimated at US$ 56.6 billion and is projected to reach US$ 87.8 billion by 2026, growing at a CAGR of 7.7 % during the said forecast period. Ceramic tiles are used as an alternative to marble and granite flooring. These tiles are generally used as outdoor flooring as they are water and frost resistant. They are made by hydraulic pressing of mixtures minerals that give a vitreous surface.

Figure1:  World exports of Ceramic Tiles, in US$ billion

Source: ITC Trade Map

World’s exports of ceramic tiles surged from US$ 5.4 billion to US$ 17.9 billion from 2012 to 2018. This implies a growth rate of 20.6% per annum calculated at exponential rate. Top exporters of ceramic tiles across world are Italy, China, Spain, India, Turkey, Brazil and Germany. Whereas top importers of ceramic tiles are USA, France, Saudi Arabia, UK, Russia, South Korea and Germany.

Alumina, feldspar, kaolin, sand, silica and zircon are the key raw materials used for manufacturing of ceramic tiles. These tiles are heavily used for residential and commercial construction. Natural minerals, namely, feldspar is used to lower the firing temperature while manufacturing these tiles. The final product is the flat and thin tiles that have wear resistance, thermal protection, and corrosion resistant properties. They are used for roofing of walls, floors, roofs, table tops and bathrooms among other applications.

Categories of product under Ceramic Tiles:

• Glazed
• Porcelain
• Scratch free
• Others

Product competitiveness

Abundant availability of raw material is anticipated to be a dominating factor driving the demand in coming decade. But from the challenge point of view, availability of substitutes and increasing application of ceramics in disk brakes and refractory is expected to impact the supply of raw material for tile manufacturing.

Technological advancements such as automation in manufacturing are expected to improve market trajectory in the forthcoming years. Recent advancements in processes have led to the development of the highest quality of finish in ceramic tiles. One or more polishing steps are done to achieve a mirror or stone finish. Owing to the automation in modern production facilities, very less human intervention is needed. This has resulted in mass manufacturing of products at lower costs.

Vitrified Tiles: A focus sub product

Swift escalation in the construction industry is one of the major factors that drive the vitrified tiles market. Surge in demand for residential and non-residential buildings has significant impact on the demand for vitrified tiles, as they are used in the flooring and walls of the buildings. They are often used as a substitute to marble and granite flooring. In addition, increasing population & urbanization and rising incomes from economic growth boost the demand for the construction market in various countries, which has propelled rapid growth for the vitrified tiles market.

At present, there are a lot of technological advancements in terms of production process and product features to achieve a competitive edge. New features such as 3D printing, digital printing, anti-microbial glazes, nanotechnology, and water jet technology are also emerging in the market. With the development of smart homes, various innovative thermal tiles such as warmth generating, energy saving, and cooling tiles are also gaining importance, especially in residential buildings.

The vitrified tiles market is segmented based on end users and geography. Based on end users the market is segmented into residential, commercial, and others. Based on geography, the market is segmented into North America, Europe, Asia-Pacific, and Latin American & MEA.

Global Vitrified Tiles Market, By Type

• Double Charged Vitrified Tiles
• Full Body Vitrified Tiles
• Soluble Salt Vitrified Tiles
• Glazed Body Vitrified Tile

Indian market

Source: ITC Trade Map

India is among the top exporter of ceramic tiles in the world. Within a span of past three years, India’s exports of ceramic tiles surged by more than US$ 800 million. There is a sudden rise in the trade surplus of ceramic tiles which is justified by a rapid proliferation in the global demand. Another reason for a rapid surge in India’s ceramic exports is that, Mexico has levied an anti-dumping duty on Chinese ceramic vitrified tiles and due to this, Indian exporter got an opportunity to replace Chinese tiles in Mexican markets. In 2018, India’s exports and imports of ceramic tiles remained at US$ 1.01 billion and US$ 0.05 billion respectively.

Major export destinations of Indian ceramic tiles are Saudi Arabia, UAE, Mexico, Iraq and Oman. So, from this we can infer that none of the top developed countries imports ceramic tiles from India, which includes USA, France, UK, South Korea and Germany. This implies high untapped potential that Indian ceramic exporters need to leverage.

Tax rates were revised from 28% to 18%, under GST slabs, which led to a decrease in the cost of finished ceramic tiles products. The decrease in price has led to an increase in the sales of the product, thereby leading to the overall growth of the industry. The organized sector consisting of 16 major players, accounts for 40% of the Indian tile industry while the remaining 60% is unorganized. The residential sector dominates the demand in India with 70% market share, while the rest of the order comes from the commercial and replacement sectors.

Increased spending on infrastructure by the Government of India, coupled with rapid urbanization is promoting the demand for residential and commercial buildings. Burgeoning space requirements from various sectors like healthcare, education and IT are making real estate a profitable industry for ceramic tiles manufacturers of India. In the coming years, the Indian ceramic tile sector certainly looks to be set for brighter days.