Turbulence in the economy does not affect everyone equally. The ceramic industry of Castellón knows it well. After a period of relative calm, the irruption of the coronavirustwo years ago now, disrupted his day to day. Global numbers show that the recovery from the pandemic was swift, although some companies failed to return to 2019 levels. Now, factories are facing problems that threaten their survival while the response of the governmentunlike other sectors, does not provide relief to situations such as the energy escalation that began in the second half of 2021 and the circumstances surrounding the war unleashed in Ukraine.
An example of these circumstances occurred at the end of last year, when the price of natural gas multiplied by five in just a few months. Now it costs ten times more. The rise in electricity had as a response the decrease in VAT on the electricity bill. This was not the case for natural gas consumers, neither domestic nor those that use this source intensively, such as ceramic kilns.
The electro-intensive ones are taken into account
An example of the loneliness in which the tile has remained is the appearance of the Prime Minister, Pedro Sánchez, last Wednesday in the Congress of Deputies. The only measure that could benefit the sector is flexibility for gas supply contracts. This means that, in the case of having to reduce production or stop for a few days, as happened during the last Christmas holidays, companies should not pay penalties for changing the conditions agreed with the suppliers. It was an industry request, but not the most important of his package of proposals. In addition, it had already been in force for a few months. It is simply extended until June 30.
Instead, the industry electro-intensive will have a reduction in tolls of 80% throughout this year, something that does not happen with large gas consumers. The Ministry of Ecological Transition, which coordinates the energy policies of the Executive, mentioned that this year’s budgets “already include aid of 470 million euros. They are 270 million for the reduction of electricity charges (91 million) and compensation of indirect costs for CO2 impacted on electricity (179 million), to which another 200 million are added for coverage of the Spanish Reserve Fund for Electro-intensive Entities Guarantees”.
Instead, There are no similar decisions for types of companies such as ceramics. The president of GasIndustrial, Verónica Rivière, recalls that in the last contacts with the ministry “we continue to request measures such as the reduction of VAT and taxation, or the recognition of the gas-intensive consumer status.” They still have no answer, while the price of gas has multiplied by 10 in just one year. Tile entrepreneurs express that with the maintenance of VAT at 10%, “the money collected by the Government for this concept reaches incredible levels.”
A postcovid high with lights and shadows
The large numbers of the sector show a amazing recovery after the period of confinement two years ago. 2020 ended with a 5% decrease in production and a new export record, selling for a value of 3,842 million. While sectors such as tourism are still far from reaching the level prior to the pandemic, ceramics recovered quickly, and was held up as an example of recovery from the crisis. A vision that the president of the patronalVicente Nomdedeu, cautiously shared: “The growth data is uneven according to the companies, and profits were reduced for 38% of companies”, exhibited last May.
On the other hand, he recalled that many industries had to resort to ICO credits, money that had to be returned amid the uncertainty generated by the waves of covid.
The wind in favor continued for much of 2021, with double-digit growth and a boom in exports, while the domestic market began to rebound. The good progress began to be cut short in the summer, with the increased shipping costsdue to imbalances derived from the global pandemic that have not yet been restored.
The dilemma: Manufacture at a loss or stop the machines
With little institutional support, ceramics struggles to survive. Demand remains strong, but businessmen know that they cannot apply all the extra costs to their prices suffered in recent months, which reduces profit margins. In some cases, even to losses.
For this reason, a new wave of stoppages in production is already being considered, like those of last Christmas. In some cases, the situation could be solved with vacation advances, but the alternative of FOR HIM sounds more and more powerful.