The REACH regulation was officially implemented on June 1, 2008, presenting significant challenges for the Chinese dyestuffs industry, which has been experiencing rapid growth. According to Professor Zhang Jie, deputy director of the China Dye Specialty Committee, China is the world's largest producer and exporter of dyes. The new regulations not only directly impact dye exports to Europe but also affect downstream industries. The EU estimates that the impact index of REACH on the dye industry could reach as high as 70%, potentially increasing costs by more than 6%.
One major reason for the fast development of China’s dye industry in recent years has been export growth. REACH covers approximately 30,000 chemicals and 3 to 5 million downstream products in the EU market. For Chinese exports, dye intermediates and finished products are key targets. Higher registration and evaluation requirements, along with costly fees and complex procedures, will raise the barriers for Chinese dyes entering the EU market, limiting the industry’s expansion opportunities.
The estimated impact on China’s dye exports is no less than 25%, or about $4 billion. As the world’s top dye producer, China accounts for 60% of global production, with over 1,200 product types, including around 600 common ones. It is also the largest dye exporter, sending more than 25% of global output abroad. In 2006, China produced about 850,000 tons of dyes and exported 390,000 tons, with 130,000 tons going to the EU—roughly a third of total exports, covering about 200 varieties.
The EU remains one of the most important markets for Chinese dye exports. In 2006, dye exports reached about 42,000 tons, making up 16.7% of total dye exports and generating around $220 million in foreign exchange. Organic pigment exports were even higher, at 46,000 tons, accounting for 33.2% of the total, worth about $200 million. However, REACH requires registration of common names and index numbers, while a large number of Chinese dyes and pigments lack proper indexing—around 1,400 dyes (40.9% of species) and 280 organic pigments (38.5% of species). This will severely hinder dye exports from China.
Imported dyes are increasingly used in China’s textile industry, which mainly exports to the EU and the U.S. New REACH restrictions have made it harder for textile chemicals to enter the European market. Substances of Very High Concern (SVHCs) are now under strict monitoring. Textiles containing ≥0.1% SVHC and annual production ≥1 ton must be notified and undergo rigorous assessment before market access. These rules, effective since 2009, replaced older regulations and will become even stricter by 2013.
As China’s textile exports face more restrictions, the dye industry is impacted both domestically and internationally. In 2006, China’s textile and apparel exports totaled around $16 billion, making up 10.9% of total exports. A significant portion of these goods, at least 30%, includes new textile products. Given that Chinese textile chemicals differ from global counterparts, the costs for animal testing, registration, and compliance will rise significantly, further challenging the dye industry’s ability to compete in the EU.
According to Wang Zhulin, secretary-general of the China Textile Engineering Society, EU restrictions on textile chemicals have pushed Chinese manufacturers to use foreign dyes, increasing imports and harming domestic producers. Zhang Jie predicts that the cost of dye exports and textile products will rise by over 5%.
REACH has a chain effect. Previously, the transfer of dye production from Europe, Japan, and the U.S. helped boost China’s dye exports. Over the past decade, China’s dye production grew at an average annual rate of 7.46%, and exports at 6.96%. With REACH, the international trade environment is deteriorating, affecting not just EU markets but also other regions.
On the surface, REACH is a safety measure within the EU, but if other countries like the U.S. and Japan adopt similar policies, the global dye trade will change dramatically. As the world’s largest dye producer, China will face significant challenges in international competition. Industry experts urge the Chinese dye sector to adapt, improve internal efficiency, enhance global competitiveness, and seek international partnerships to mitigate the negative effects of REACH and ensure long-term development.
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