Floating glass prices double for new tariff

Ismail Hossain | Published: October 10, 2016 00:00:00 | Updated: February 01, 2018 00:00:00

The retail prices of floating glass almost doubled in last four months, following imposition of new minimum import tariff on about 30 types of glasses in the national budget for the fiscal year 2016-17.
According to port authorities and glass market insiders, around 50 containers of imported glasses are now lying at the port. Their importers are not releasing the items after the new valuation fearing substantial loss.
National Board of Revenue (NBR) issued a Statutory Regulatory Order (SRO) on July 1, imposing new minimum import tariff on 300 products including 30 types of glasses.
The glasses include dark blue, green, lake blue, bronze, reflective glass in sheet, clear float glass, tempered and laminated safety glass, and mirror glass.
Sector insiders said the price of per square feet mirror glass has increased from Tk 35 to 65 in last four months in phases. The prices of other glasses have also soared during the period.
Bangladesh Glass Merchant Association President Alamgir Hossain said at present there are only two big manufacturers in the country -- PHP and Nasir Glass. They are enjoying duopoly by controlling around 60 per cent of the more-than-Tk 180 billion local float glass market. Â
He also alleged that these two companies influenced the government to issue the SRO and impose new tariff on imported glasses. Now they are increasing prices of their products whimsically following their higher prices in the market.
On the other hand, the country's oldest glass manufacturer -- the state-owned Usmania Glass Factory -- and MEB Sheet Glass Industries are producing sheet glass, capturing maximum 10 per cent market shares.
So, about 30-35 per cent of local demand of sheet glass is being met through import amid its growing demand.
Mr Hossain said they sat with NBR, and the officials promised them to resolve the SRO issue, with a view to reducing the prices of imported glasses in the market.
While contacted, Shafiqul Alam, head of marketing of Nasir Glass, refused to comment on the recent price hike.
The sector insiders also said the two big market leaders -- PHP and Nasir Glass -- are planning to expand their markets further, as the local demand is gradually rising.
Nasir Glass is setting up its second manufacturing unit in Mirzapur, Tangail, investing nearly Tk 120 billion. The new unit will produce 800 tonnes of glass per day once it starts commercial production in about three years' time. The production capacity of its existing factory in Gazipur has been recently doubled to 500 tonnes per day.
Besides, PHP Float Glass has also planned to double its monthly production capacity from 2,500 tonnes to 5,000 tonnes investing more than Tk 150 billion.
Before Nasir Glass and PHP entered the market in 2005 and 2006 respectively, float glass was imported in the country in a small scale.
The demand for the product, mainly used in buildings, now stands at around 15,000 tonnes per month, which was just 200 tonnes ten years ago.
The insiders further said the monthly demand is expected to rise to 30,000 tonnes in the next five years due to sharp growth in its rural demand.
Between 2005 and 2013, the demand was driven mainly by urban consumers. But of late, it is being fuelled by rural consumers, who now prefer to use low-cost float glass to costly wood in their houses in upazila and village levels.
About 60 per cent of Nasir Group's float glass is now used in rural Bangladesh. It was around 10-15 per cent five years ago.
Silica and gas, the primary raw-materials of float glass makers, are available in the country, while the secondary raw materials like dolomite, feldspar and limestone are imported from the neighbouring Bhutan, Nepal and India.
Float glass is non-combustible and easy to clean. It prevents harmful penetration of ultraviolet-ray and reduces solar heat inside the building. It is cheaper than wooden panel.
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