REACH Regulations Affect Nanjing Textile And Leather Industry

Since June 1st, EU REACH registration has been officially launched.

In accordance with this regulation, all chemicals entering the EU must be pre registered, tested, and evaluated.

According to reports, at least 3 enterprises in Jiangsu are affected.

For Nanjing, there are more than 100 chemical enterprises directly affected and thousands of enterprises indirectly affected, such as textiles and clothing.

How much impact will this regulation, which is known as China's "biggest technical barrier to international trade", bring to Nanjing's export enterprises?

According to the preliminary assessment of relevant experts, the REACH regulations will raise the export cost of Nanjing related enterprises by 3%~5% and increase the import cost by more than 6%.

A group of enterprises have already started pre registration. In June 19th, Hong Bin, director of the REACH consulting service center of Jiangsu inspection and Quarantine Association, came to Nanjing Hongbao International Trade Co., Ltd., and handed in the certificate of three kinds of material obtained by REACH to Vice General Manager Zhang Liangfu.

According to introducing, this is the first enterprise registered by REACH in Nanjing area.

Zhang Liangfu said that they are a foreign trade company with independent import and export operation rights, mainly exporting isopropanol amine series products.

At present, the company's annual output reaches 20 thousand tons, of which 75% is exported.

The EU is their second largest export destination, with an annual export volume of more than 5000 tons.

Recently, they are still expanding their projects in an effort to increase the production of isopropanamine products to 60 thousand tons in 2009, and will further expand the EU market.

"If we fail to complete pre registration within the specified time, we will not be able to export even 1 grams of products to the EU from January 1st next year."

After obtaining the pre registration certificate, a stone in Zhang Liangfu's mind finally landed, because in recent years, many European Union customers have called the company to ask if they have pre registered, if not, it is very likely to terminate the partnership.

Reporters learned from the quarantine department, at present, Jiangsu has 17 enterprises of 80 chemicals successfully completed the EU REACH pre registration, and some enterprises are declaring.

The export cost of related enterprises is rising. 3%~5% "REACH regulations will increase the export cost of our isopropyl amine series products by 3.5%, six hundred or seven hundred yuan more than in the past."

Zhang Liangfu said that the cost of this increase will be partly borne by downstream enterprises.

At present, the downstream enterprises of isopropanol series products are mainly refineries and cement plants.

Will it lose some customers?

Zhang Liangfu believes that now some of the world's major raw materials are rising, which has little impact on the increase in costs.

For example, he said, in the first few months of this year, propylene oxide, the main raw material for making isopropyl amine products, increased from $1700 per ton to US $2200, an increase of over 30%.

The export price of Hongbao products has also been rising rapidly. At present, the export price of each ton of products is 2300~2500 dollars, and the downstream businesses of Hongbao are also accepting it.

However, not all export enterprises are as optimistic as Hongbao Li Trading Company.

The head of a small garment enterprise told reporters that because a garment often contains several kinds of dyes, there are dozens of chemicals that need to be registered, and hundreds of them are used.

Although most of these substances are registered by upstream manufacturers, the cost will eventually be pferred to them. "Our export volume is not big, profits are very thin, and costs are rising several points. We are likely to lose money."

He said.

According to preliminary estimates by quarantine experts, the REACH regulations will raise the export cost of Nanjing related enterprises by 3%~5% and increase the import cost by more than 6%.

This is a small pressure for some small and medium-sized enterprises.

Enterprises can entrust agencies to carry out pre registration quarantine experts, and for relevant enterprises, we should seize the deadline before December 1st this year to get enough pitional period through pre registration.

At present, there are several options for pre registration of export enterprises in our city. If it is a multinational company, the headquarters or offices can be registered within the European Union, and the third party agents are registered.

At present, the REACH consulting service center of Jiangsu inspection and Quarantine Association is the only third party agency in our province.

Liu Hongbin said that at present, the pre registration of enterprises requires two kinds of fees: one is the pre registration review agency fee of 8000 yuan for each enterprise, and the other is the 400 Euro expert of each material applying for agency fee.

In addition, if an enterprise is not sure whether the substances contained in its products are registered in the REACH regulations, it can be checked and confirmed by the Sino German REACH material analysis and testing laboratory under the Jiangsu entry exit inspection and Quarantine Bureau.