Edition 64 (October-December, 2021)

Market Scan
Uncertainty in Indian glass sector over
historical shortage of clear float
Demand-Supply Gap Soars, Prices Hit All-Time Highs; Processors Wary As
No Solution In Sight
India’s glass industry is going through a very difficult time as the country looks to come
out of the shadow of the COVID-19 pandemic.
Amid a number of uncertainties,
the glass industry of India also
faces a historical shortage of flat
glass in the market, especially clear
float glass.
Glass Bulletin conducted a survey
on this current situation of glass
shortage among glass manufacturers,
dealers, glass processors, wholesalers
and retailers to understand what they
think about it and also sought their
feedback and suggestions to overcome
the same.
During the lockdown last year, glass
companies were breaking glass and
recycling it to keep their furnaces
running and also avoid surplus stock
in their warehouses. But after the
lockdown was eased, demand of
glasses in various segments have
increased tremendously.
But since the production capacity
remained unchanged, the gap between
demand and supply widened. This
gap of glass in the market meant
manufacturers were unable to meet
the demand. But it also meant prices
soared to all-time highs.
There has been no new float line set
up in the last two years (after 2019).
And setting up one from scratch takes
at least two years before production
can begin. Hence, while demand will
rise, supply won’t, which essentially
means the gap will persist.
Import of glass has fallen
significantly after COVID-19 and
freight has become three to four times
higher than usual. So, even importing
glass makes less sense now as costs
will rise. The Indian government has
imposed anti-dumping on the import
of glass. This means prices are bound
to go higher in case of imports.
The gap has grown to an extent
that big and established processors
are unable to get raw materials. This,
in turn, is preventing new processors
from entering the segment.
New glass processors who were still
willing to come and start processing
units are definitely the most affected.
The situation is more problematic for
new entrants as they find themselves
staring at no supply of raw materials
to keep their units running as glass is
"
As production capacity
has remained unchanged,
gap between demand
and supply has widened,
pushing prices to all-time
highs.
the basic raw material to run a glass
processing unit.
With the demand climbing,
processors find themselves in a
situation where they are unable to
fulfil orders. Many are even refunding
advances received for orders as
they are not able to procure the raw
materials required for it.
Prices of raw materials fluctuating
so rapidly that processors are unsure
how the change in the raw material
cost will affect production cost. As
a result of this, processors are also
reluctant to take orders.
Manufacturers on the other hand
have kept up exports. Many processors
GB spoke to wanted government
intervention to temporarily pause
exports so that domestic market can
recover from the historic shortage of
raw materials.
Several companies were also of the
opinion that manufacturers should
understand the seriousness of the
situation and make efforts to back
domestic processors.
Float companies, however, said
they were giving raw materials to their
customers who have stood by through
difficult times. Local home appliances
manufacturers have approached them
for glass as they are unable to procure
it from China and other countries like
they used to earlier due to high prices.
Float companies also said they
understand the current scenario of
shortage. All such companies GB
spoke to assured that they are more
focused on manufacturing clear float
glass and are also planning capacity
expansion to minimise the shortage.
These companies said they are
increasing prices due to rates of raw
material and fuel being at all-time
highs.
Glass Bulletin | October - December, 2021 89