How ink industry can make an impression after Covid dip - The Noel D'Cunha Sunday Column
AIPIMA president, R Sridharan, hopes to upgrade the ink association's knowledge sessions through outreach programs.
21 Nov 2021 | By Noel D'Cunha
Noel D’Cunha: (NMD): Kudos and congratulations on being elected president of AIPIMA. What was the first thing you did when you got the news?
R Sridharan (RS): The first thing I did was to thank God, and then the members of the association for not only confirming me as the president but also for giving AIPMA a mix of the executive committee team. The team has experienced persons along with quite a few smart youngsters. . This committee is balanced with representation from all types of ink manufacturing units from across all the regions.
NMD: What was the first thing on your agenda?
RS: The Asia Coat & Ink show 2022, is the first event on our agenda. It is the signature event of our organisation meticulously planned by our predecessors and successfully conducted for more than a decade. We have a committee of experienced and young team members working on the success of this event with inputs and guidance from our team of past presidents.
NMD: Who are the team members?
RS: Our Asia Coat & Ink Show committee is chaired by Dr Ravindra Gandhi. The international seminar committee is chaired by Mr. Raghava Rao.
NMD: What is your plan for the next 12 months?
RS: While the Asia Coat & Ink Show and the international technical seminar will be given the top priority, the continuity of the activities of our previous team will be given importance. Subjects such as Toluene-ban, product standardisation of eco-friendly inks and biodegradable inks will be worked out with BIS. This project is being overseen by our technical committee members. Print has to substitute harmful ingredients with safer ones, greener ones.
NMD: What about the pandemic?
RS: The after-effect of the pandemic is the primary concern of the current team and necessary steps will be taken to address these issues. Subjects such as price increase of raw materials, cost of transportation and its effects, the shortage of materials and other burning issues were already discussed by our executive committee. We will come out with some directives about how the industry should face the situation.
NMD: That's good. Anything else?
RS: The fire accidents in many ink units all over the country in the recent past have also been discussed. We plan to conduct seminars cum webinars on how to avoid such accidents to ensure that frequency of such incidents are brought down and some solutions are being worked out with some leading insurance consultants. Apart from the above, we will be holding regional meetings and seminars in different parts of the country to address the issues of the members. We will conduct technical workshops in each region. In addition, there is the InkNews magazine. Our InkNews committee is chaired by Dr Zainul Lakdawala.
NMD: Tough time to be a president - what with the second wave of Covid and the deaths and the medical emergency. Has AIPIMA organised any support for beleaguered print families?
RS: Yes, tough times. And yes, tough people, that are ink makers, will fight with constructive ideas and forge ahead. The direct effect of Covid on our member units and families was minimal. Though as an association, we have not taken any specific step. However, many of our members have donated huge funds to local Governments and PM Fund. Plus quite a few have physically helped many people in their respective areas by distributing free food, medicine, and masks. They have assisted many to get the vaccination done. I have personally helped by distributing a few thousand grocery packets to migrant workers in and around our area. We conducted vaccination camps through our local industrial association and through our Rotary hospital. The tough time is not going to last long. AIPIMA has been of support to one and all in the ink fraternity.
NMD: There is huge uncertainty about the cost of raw materials like resin and freight costs and coal shortage. How are AIPIMA members and their ink factories coping?
RS: Yes, you name the item and it’s on fire. We will increase our prices as we don't have any choice. Of course, this will be done with a proper conversation with the converters. The situation is grim.
NMD: Will your customers pay heed?
RS: The trend is changing. These being universal phenomena, most of the customers understand the situation and are cooperative. As an industry, we want to ensure that we avoid any unhealthy competition which is likely to be detrimental to our own interest. We hope that the situation will change sooner rather than later.
NMD: When are ink prices likely to be normalised to an earlier price level?
RS: It’s the question on everyone's mind. But I see no early solution to it. Maybe this is the "new normal".
NMD: Is it true that the speculators are taking advantage of the unprecedented circumstances leading to the worst impact on the price?
RS: It’s a question of someone taking advantage, at someone else's cost. Yes, speculation created by social media has much more impact than the news and television media. Hope better sense prevails and people think of long term gains over short term ones.
NMD: The other C question. What is transpiring with the Chinese economy? It is said that a strong global market demand along with China’s V shape economic recovery (after slump), has led to shortages of many raw materials. To what extent is this impacting the market in India?
RS: Though I do not have the wherewithal to comment on the Chinese economy at this stage, what I know is, China has a strong foothold in the chemical industry and the dependence on Chinese industry for chemicals cannot be undermined. Obviously, the dependence on Chinese products by the printing ink industry is very high and it is bound to take a reasonable time to overcome this. Our Prime Minister's program of Atmanirbhar Bharat will be on our agenda in our seminars in the days to come. Also, we will be coordinating with our supplier industry to achieve this.
NMD: China has picked up huge quantities of resin as the demand picked up. Your comments?
RS: Chinese economy, exports and internal consumption are huge. China is bound to take care of its interest first which in all likelihood will affect us. We have to work out some strategies to take care of our interests.
NMD: Likewise, the ink pundits are saying, yellow pigment prices may go up in the coming days because there are chances that the GOI may impose import duty on the imports of Arylides imported from China. The anti-dumping duty is expected to be in the range of 22% to 44%.
RS: Yes. The Ministry of Finance has accepted the recommendations of the Directorate of Trade & Remedies (DGTR) to impose the anti-dumping duty on Aceto-acetyl derivatives of aromatic or heterocyclic compounds namely Arylides up to 22-44% imported from China. The notification will be effective for the next five years which is a major setback for those who manufacture pigment yellow.
NMD: Matter of concern?
RS: The indicative price increase is likely to be up to Rs 100-150 per kg depending on the product quality. We plan to take the necessary steps in consultation with our supplier industry members.
RS: The apex body of the graphic art industry is being formed. As this will be a bigger forum, we will be able to jointly take necessary action for the common cause as these price increase will not only affect the printing ink industry but the related industries also.
NMD: Three trends that are worrisome: cyan pigment prices have moved up because of an increase in copper and urea price is increasing. Likewise, Cabot and Birla have increased their black pigment price by 24% and 26% in January 2021. And finally, the Indian government has increased customs duty from 5% to 7.5% in black pigments increasing the cost of black pigment. The question is: how will these impact AIPIMA members?
RS: Though prices of all materials have gone up in double digits, these specific items are likely to increase further. This will definitely affect the profitability of the AIPIMA members who are already working with high raw material content in their products while having to work at a very low margin.
NMD: Will the effect be across the board?
RS: MNCs and big established companies may be able to withstand these conditions because of their financial capacity though their profitability is also likely to be affected. MSMEs will be affected very much as most of them depend on bank finance and will find the going really tough. Having said these points, we have seen many price increases in the past and industry as a whole has been withstanding this type of onslaught but have come back strongly. I am sure our members will be back enjoying the new normal.
NMD: What is transpiring with the water base - OPV? Due to force majeure monomer manufacturing plants and shortage of acrylic acid, the price of monomers have increased has caused an increase in the price of WBOPV. What is AIPIMA’s view?
RS: AIPIMA has a limited role in pricing or availability of raw materials and pricing of inks. The problem is real. AIPIMA is guiding the MSME to unite and take certain innovative steps to help each other to reduce their unhealthy competition and convert their weaknesses to their strength. In the recent past AIPIMA’s activities have brought MNCs and MSMEs much closer and in the days to come instead of competing with each other we may be complementing each other. This will be possible once AIPIMA makes its members understand that this approach will create a win-win situation for all including our suppliers and the customers.
NMD: Any steps taken by AIPIMA with the government?
RS: AIPIMA feels the government at this point is also assessing the situation. It’s a worldwide phenomenon. We haven’t yet decided to represent to the government except in matters like GST and other policy matters.
NMD: What else?
RS: Our major task as of now is to get the recognition / proper identity for the printing ink manufacturing industry from the government and ensure our industry gets benefits like other segments such as the paint industry. Right now our industry is being projected as a part of the paint industry in many forums such as the export council and others.
NMD: Who is representing our industry to the government to address all challenges – shipping, containers, paper, and power to begin with ...
RS: AIPIMA has a technical committee headed by Utsab Chaudhary of DIC. This committee will decide and take up the matters with the concerned departments with support from the office-bearers. In the recent past, our committee had successful meetings with government organisations such as BIS. Many more are in pipeline to discuss several technical/safety-related issues.
NMD: One lesson you have learnt from the past 18 months?
RS: All of us learnt a lot during the past 18 months through the effects of the pandemic. Once again nature has proved that change is the only thing that is permanent. Let us understand the basics and work efficiently together to achieve what we want. The need of the hour is to build a strong core team and this team can strive to work hard to fulfil the dreams of valuable members.
NMD: As president of the AIPIMA what is your message to the fraternity for 2021-22?
RS: Be innovative, cost-efficient and think BIG. We are in a highly technically-oriented industry. It is our duty to maintain the image of our industry. My message through you is that we all have to give top priority to protecting mother earth by meticulously / sincerely contributing in the best possible way to create a sustainable environment and thereby protecting the future of the next generation.
(R Sridharan is also the managing director, Spico Printing Inks, Chennai)