Ceramics have come a long way from their humble beginnings more than 26,000 years ago as primitive pottery and figures made from burnt clay and other minerals. From the tableware in our dining tables to the insulators in automotive parts, ceramics is more encompassing in our lives today than we perhaps realise. Starting its journey in the late ’50s, when Tajma Ceramics Industries Ltd. started its business, the ceramics industry in Bangladesh has been one of the rapidly growing manufacturing industries, with around 68 producers currently (of which only five companies are listed), making ceramics products like heavy clay (e.g., pottery, terracotta), tiles, sanitary ware (e.g., basins, toilet bowls, plumbing fixtures), insulators (e.g., pin insulator, disc insulator), and tableware (e.g., dinner plates, bowls, etc.). Bangladesh’s ceramics market has grown to more than BDT 6,000 crore with a multidimensional growth of 20% annual growth in the domestic market and 26% growth in the export market (2019), thanks to stable economic growth coupled with an increase in people’s disposable income, rapid urbanisation, and a variety of housing options. Currently, the industry caters to around 80% of the local demand. About 95% of tableware, 75% of tiles, and 85% of sanitary ware demand are met through local production. About 48,000 people are employed directly by the industry, while it is believed that over 500,000 others are employed indirectly. The industry promises immense potential, but it is not without some major challenges to be overcome to sustain its growth, especially in the form of the ongoing energy crisis and raw material, shipping, and transportation prices all skyrocketing as a result of the Russia-Ukraine conflict.

Global Market Scenario
According to Statista, the value of the world ceramics market in 2018 was estimated to be USD 229.13 billion. The size of the global ceramics market is expected to reach close to USD 408 billion by 2025. One of the most common uses for ceramics is in tiles, which come in a variety of shapes and sizes that are ideal for use in mosaics, flooring, roofing, and other applications.

Sharp Rise in Tiles Manufacturing Worldwide
Global tiles production grew by 7.2% in 2021 to 18,339 million square metres from the 17,101 million square metres reported in 2020. The outcome illustrates the sharp rise in tiles demand across all regions, which caused global tiles consumption to climb to 18,209 million square metres (+6.8%).
Asia now produces 13.6 billion square metres or 74% of the world’s total production, as per Ceramic Tile and Stone Consultants. This favourable outcome was mostly brought about by an increase in production volumes in China, India, and Indonesia. As of 2020, China was also the world’s largest consumer of ceramic tiles (together with Asia in a macroregional comparison), according to Statista’s research. Total output on the European continent was 11.6% of global production. North America grew 17.4%, whereas Central and South America grew 24.5%. In 2021, only Africa had a decrease in output (-3.3%).

Global Exports Topping 3 Billion Square Meters

According to the study of Ceramic Tile and Stone Consultants, the EU exported 1,055 million square metres (+14.3%), 35% of the world’s total. Central and South America (+36.3%), North America (+10.7%), and Africa (+4.6%) all increased exports. In 2021, the EU exported 75.7% of its production, the most of any continent or macroregion. Spain reclaimed second place as the world’s largest exporting country in 2021, while India fell to third.

Ceramics Engineering and Non-Tiles Ceramics Applications

Tiles are only one example of a large number of goods and industries that make use of ceramics. Porcelain is delicate and exquisite, whereas ceramic dishes and pottery are long-lasting and aesthetically pleasing. The fields of ceramics engineering and growing demand for advanced ceramics across a wide range of industries (e.g., dental implant technologies utilising highperformance ceramics) is where traditional ceramics become cutting-edge and innovative. For instance, thermal ceramics can withstand temperatures of almost 2,000 degrees Celsius without breaking down. As per Statista, the transportation, petrochemical, and chemical sectors, among others, will contribute to thermal ceramics’ nearly USD 4 billion worldwide market value by 2024. By 2026, the global market for glass ceramics, another type of technical ceramics, is expected to be worth about two billion dollars.

Background of the Ceramics Industry in Bangladesh
Bangladesh’s ceramics industry is one of the fastestgrowing manufacturing sectors in the country. Local demand for ceramic items continues to rise as the country’s economy expands and urbanisation accelerates. Following the COVID-19 outbreak in 2020, the industry faced a 30% sales drop. Four of the five listed ceramics companies reported profits in 2020, although at lower rates than in 2019, while one declared losses. For example, the revenue of RAK Ceramics, the market leader in tiles and bathroom fittings, fell by 9.82%, and profits fell by 58.81% in 2020, while in the case of Shinepukur Ceramics, revenues fell by 4%, although profits increased 77%; at Standard Ceramics, revenue increased 17%, but profits dropped 71%; and in the case of Fu-Wang Ceramics, revenue increased by 26%, but profit slipped 0.99%.
The industry has, since then, largely recovered from the pandemic’s shocks, mainly thanks to the recovery
in the forward linkage of the construction sector. This underscores the market’s fundamental characteristics, particularly the government’s emphasis on affordable housing, which has allowed the sector to rebound. The country’s tiles and sanitary ware business has also benefited from expanding disposable incomes, a growing desire for larger and roomier houses, competitive mortgage rates, and an overall young population. The manufacturing capacity of Bangladesh’s ceramics sector increased by approximately 200% between 2008 and 2018, a USAID study found. The companies produce 50 lakh pieces of sanitary ware, 15 crore square feet of tiles, and 25 crore pieces of tableware annually. Meanwhile, sales of ceramics reached BDT 6,000 crore in the 2020-21 fiscal year, as reported by the Bangladesh Ceramic Manufacturers and Exporters Association. Of that total, BDT 1,000 crore was spent on kitchen and bathroom accessories. Tiles were a big seller for domestic producers that year, bringing in BDT 4,300 crore, while imports brought in BDT 700 crore.

Leading Market Players and Export Trends/Destinations
According to The Business Standard, of the 68 ceramics manufacturing facilities in Bangladesh, 18 of them produce sanitary ware, 20 produce tableware, and the rest produce tiles.

Tiles Market
More than 60% of the market for tiles is controlled by five major manufacturers. RAK and Akij collectively control approximately 32.32% of the market for tiles, each possessing around 16% of the market share, followed by strong competitors such as Greatwall, Star, Abul Khair, and Mir Ceramics. Other regional brands and a few imported Chinese brands account for more than one-third of the tiles market. Among the other brands is DBL Ceramics Ltd., which began operations in its fully automated plant at the end of 2016. Modern equipment and technology have been installed by the company to increase its daily manufacturing capacity to 35,000 square metres. It also established a strong supply chain across the country.

Tiles Market Share

Tableware Market
In terms of the market share for ceramics products across the country, Shinepukur Ceramics, a subsidiary of the Beximco Group, holds 18% of the tableware market, estimated to be valued at over BDT 500 crore, and 24% of all exports during the 2018–19 fiscal year. One of the largest and oldest tableware producers, Monno Ceramics, founded in 1984, enjoys a solid reputation domestically and abroad. The business, which employs 2,000 people, can produce around 250,000 and 1.5 million pieces of porcelain and bone china each month, respectively.

Sanitary Ware Market
About one-third (30%) of the BDT 1,000 crore sanitary ware market is held by RAK Ceramics, a UAE-Bangladesh joint venture enterprise that is listed on the Dhaka Stock Exchange and the Abu Dhabi Securities Exchange in the UAE. The company produces a wide range of goods, including ceramics and porcelain tiles, bathroom accessories, and all types of sanitary ware. It currently offers more than 2,500 models and often rolls out new styles to keep up with changing customer demands.
As per NewVision, 18% of the market is controlled by Abul Khair Ceramics, a subsidiary of the regional conglomerate Abul Khair Group. Due to its affordability and accessibility, the company’s “Stella” brand of sanitary ware goods is one of the most well-known in the local market. Abul Khair Ceramics has established itself as a significant contender in the sanitary ware market thanks to its broad distribution network and dealership network.
The industry has had tremendous growth over the past six years, especially in the export sector, relying on diversified tableware products. As opposed to the EPB’s estimated goal of USD 35 million, export earnings in FY 2021–22 were USD 41.36 million. With exports exceeding USD 41 million in FY 2021–22, the sector has a presence in over 50 countries, including the UK, the USA, Italy, Spain, Norway, France, the Netherlands, Australia, and more. The main drivers of growth, which have contributed more than USD 9 million in fortune to the business and are anticipated to continue the trend, are the US-China trade conflict and rising European demand.

The ceramics sector has experienced exponential expansion over the course of investment accumulating along with the expanding domestic and international markets. The entire aggregate investment increased by 70% over the past four years, from USD 619.38 million in 2014 to USD 1,051.77 million in total. It is anticipated that 20 new enterprises will join the ceramics industry fleet in the next few years as a result of this investment increase. In order to take advantage of expanding opportunities, current firms are likewise concentrating on production expansion. According to Bangladesh Ceramic Manufacturers
and Exporters Association, of the total accumulated investment, the export-focused tableware segment accounts for 20%, tiles for 59%, and sanitary ware for 16%.

Prospects of the Industry
There is a lot of room for expansion in the ceramics industry in both the domestic and international arenas because of the country’s ability to produce high-quality products at competitive prices.

Burgeoning Urbanization and Rising Income
As the nation continues to experience stable economic expansion and urbanisation, the local demand for ceramic goods is also growing. According to industry experts, the number of households will also rise from 3.2 crores to 4.3 crores by 2025. In rural regions where using ceramics materials in the construction of homes and mosques is now very popular, demand for ceramics items has also expanded as people’s earnings have grown over time. This expected increase in population affordability, along with rising real estate development and prospective lifestyle changes brought on by expanding urbanisation, point to future sector growth opportunities.

Competitive Labour Pool
Bangladesh’s export-focused businesses have a distinct cost advantage due to the country’s cheap wage structure and availability of a large labour pool of semi-skilled to skilled workers. Despite continued competition from China, India, and Thailand in international markets, Bangladesh’s ceramics sector has benefited from and is likely to continue to benefit from the country’s comparatively low labour costs accessible for local manufacturing.

Access to Duty-free Markets
The ceramics industry in Bangladesh has the potential to increase its export competitiveness thanks to duty-free market access to a number of developed countries under the Generalised System of Preferences (GSP), including the European Union (EU), the United Kingdom (UK), Australia, New Zealand, Japan, Japan, Canada, and Russia. In contrast, Chinese ceramics products, a major competitor to Bangladesh, must bear additional duties to access such markets, such as up to 12% duties for EU markets.

Untapped Export Potential
Bangladesh Ceramic Manufacturers and Exporters Association reports that domestic demand for tiles and sanitary items exceeds domestic production. The current production capacity for tiles in the country is 20 crore square metres, whereas the total domestic demand is roughly 26 crore square metres. Likewise, the quantity of tiles produced falls short of the demand. Approximately 24% of the demand for tiles is fulfilled by imports due to the gap between demand and output.

Industry-Academia Collaboration
Research partnerships between businesses and universities are becoming increasingly important as the global ceramics sector experiences rapid expansion and introduces new applications for ceramics across a wide range of sectors. With this in mind, the Higher Education Quality Enhancement Project of the University Grants Commission of Bangladesh has funded industry-academia collaborative research in Bangladesh to develop innovative technologies in recent years.
Challenges Facing the Industry
According to LightCastle Partners, the production of ceramics is a process industry that heavily relies on the use of gas, which constitutes around 21% of production costs. The kiln’s fire requires constant access to the gas supply. There must also be a constant, high rate of gas flow at around 15 PSI. Many manufacturing facilities, meanwhile, are suffering financial losses as a result of reduced output caused by the gas crisis.
The onset of the Russia-Ukraine war in February 2022 and the subsequent decision by Russia to cut off gas supplies to Europe in retaliation to Western sanctions placed on the country led to an energy crisis in Europe, setting off a domino effect on the global market for liquefied natural gas (LNG). This year, the cost of natural gas skyrocketed to all-time highs in the international market. In March 2022, Bangladesh saw the beginning of the gas crisis, and the problem got much worse from September on.
This skyrocketing LNG price also came at a time when burgeoning dollar rates were putting pressure on the rapidly depleting forex reserves of the country, prompting the government to halt spot LNG imports since July 2022 and implement austerity measures in the form of power outages or ‘load-shedding’ as the government attempts to contain the fuel price. About 60% of Bangladesh’s energy comes from natural gas, and a quarter of that gas is imported from other countries.
This dual energy crisis has proven to be a serious issue for the ceramics industry, where both electricity and gas are required to power the manufacturing facilities, which must reach temperatures above 500° C and up to 2000° C in some cases to make bricks or tiles by baking clay. The factories are faced with an unsettling situation as the gas pressure remains good.

during the day; however, they have to remain closed due to power outages, and gas pressure drops at night when the power is restored. Bangladesh Ceramic Manufacturers and Exporters Association reports that gas supply problems have caused manufacturers to cancel several work orders because they cannot meet the deadlines of their international clients. Also affected are their local market suppliers. Other than the ongoing energy crisis, another significant issue for this industry is its over-reliance on the import of raw materials, as almost 95% of raw materials come from abroad. A supply chain crunch due to COVID-19 and then the Russia-Ukraine conflict has meant that the companies that relied on the import of clay from Ukraine are having to search for alternate sources that are costlier. Concerns also exist for the ceramics export industry once Bangladesh loses its LDC classification in 2026 since the average tariff on ceramics entering foreign markets will increase to 12.7%.

A Way Forward

Bangladesh’s ceramics sector has grown to be a crucial pillar for the nation’s housing and construction industry, and this industry is already contributing through export revenues, foreign investment, and other means to the nation’s economy while at the same time producing employment and saving money. Industry insiders claim that this is possible if the government gives this industry careful consideration and supports it, particularly in resolving the power crisis afflicting the factories. There is still much to be done to address the problems this industry is facing, such as uninterrupted power and gas supplies, which are essential to continue competing in global markets. If Bangladesh’s ceramics sector can get over the obstacles, it has every chance to develop and increase its contribution to the nation’s foreign exchange earnings.