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Recent Successes, Events and Activities

In March 2007, the Center of Technical Excellence in Ceramics (Centec) - established by the Ceramics Council and the Industrial Technology Institute at a total investment of approximately US$140,000 (50% as a TCP grant of US$97,842) - was opened. Centec will facilitate all testing as well as R&D and training for the industry and will include ceramic related departments of universities

22 people trained and employed in ceramics manufacturing in 2005-2006

Procedure for applying for a ball clay mining license streamlined by reducing the number of documents required

In 2006, two ceramics raw material improvement programs implemented with technical assistance to improve quality and consistency of raw materials

Initiated a link with the industry and a leading US Ceramics institution, Kazuo Inamori School of Engineering, New York State College of Ceramics at Alfred University

The ceramics industry cluster was formed in 2001 with the assistance of The Competitiveness Initiative (TCI), an USAID funded project. TCI was the predecessor to The Competitiveness Program. The ceramics cluster was initiated to develop and implement an unified, industry-wide strategy to enhance the competitiveness of Sri Lanka’s ceramics industry through activities such as branding, creation of “Centers of Technical Excellence” and workforce development programs. Membership was drawn from across the ceramics industry value chain.

In November 2003, the ceramics cluster formalized its role in the industry by incorporating the Sri Lanka Ceramics Council (SLACC), which was officially launched on February 11, 2004, and now operates under the aegis of the Ceylon Chamber of Commerce (CCC). SLACC today is undeniably one of the richest forums of industry representatives in the island and serves as the apex body for the Sri Lanka ceramics industry.

Over the years, both the ceramics cluster and subsequently SLACC, have played a catalytic role in building consensus and dialogue between various economic counterparts in addition to promoting competitiveness enhancing industry initiatives; more fully described below:

LPG Pricing
The high cost of energy (known to be the highest in Asia) was identified as one of the main challenges facing Sri Lanka’s ceramics industry today. To address this issue, SALCC made collective recommendations to LP gas suppliers, to regulate prices so that they reflect world market rates and to the government, to implement projects that will provide electricity at competitive prices. Given the strength of its industry representation, SLACC succeeded in negotiated a transparent pricing formula for LP gas supplied to the industry by Shell Gas Lanka Ltd., including discounts for bulk purchases to subscribing ceramic companies.

Web Portal
With TCI assistance, the Ceramics cluster launched an industry web portal (www.ceramics.lk) in June 2002 and in 2004, SLACC signed an MOU with its service provider to offer banner advertising and a payment gateway for online purchases.

The site is devoted to the Sri Lanka ceramics industry and helps generate awareness of Sri Lankan ceramics in the global marketplace. It also serve as a platform for information to both local and foreign buyers, suppliers, manufacturers, raw material suppliers and potential investors and promotes industry growth through news features, industry trends and other sources of information.

Workforce Development- Industry Placement Program
To support the competitiveness of the local workforce, TCP provided technical assistance to the Sri Lanka Ceramics Council (SLACC) to develop a pilot industry placement program (IPP). This IPP was launched in January 2004 in conjunction with the University of Moratuwa.

Through this IPP, the University of Moratuwa and the ceramics industry implemented a structured one term (6 month) on-the-job internship training program for third year university students to gain hands- on industry experience and make the participants more employable upon graduation. Seven ceramic companies trained 10 undergraduate students and TCP played a pivotal role in designing and supporting the program through facilitation and partial cost-shared funding. Two of the 10 students trained were offered jobs prospectively upon graduation from university.

Given the success of the pilot a second IPP was launched in early 2005, with an added program for developing business communication and management skills of participant trainees.

Joint Procurement/ Strategic Sourcing Review
With support from TCI, five strategic sourcing teams (1. Grinding Media, Clays, Local Non-Plastic Raw Materials, Packaging, Tiles specific imported materials) were formed in January 2003 as a follow on to a joint procurement study concluded earlier. Technical assistance was consequently provided by TCP Resident Advisor, Jagdesh Mirchandani, to review and assess the benefits and barriers/constraints realized under this initiative so that companies can use both the quantitative and qualitative knowledge gained through the exercise and apply it to realize benefits at firm level.

Sri Lanka Ceramics Symposium
The Sri Lanka Ceramics Symposium, organized by the Sri Lanka Ceramics Council (SLACC), was held on July 17th and 18th, 2004 at the Taj Samudra Hotel in Colombo, with partial cost- shared funding from TCP.

The very first such Symposium was organized by the ceramics cluster in August 2002, and provided organizations and individuals in the local ceramics industry, an opportunity to acquire information and knowledge of the latest trends and developments in the global market. This maiden effort was a tremendous success with presentations made by eminent local and foreign speakers from world-renowned organizations. Over 140 local and foreign participants were present at this event.

In 2004 also, SLACC had the privilege of organizing yet another Symposium and acquired the support of foreign and local presenters for the knowledge sharing sessions. “Rising above… to look beyond” was the theme of this Symposium and SLACC had a line up of eminent local and international ceramics industry specialists to address the gathering of over 150 participants.

Productivity Improvement Program
Productivity improvement is an essential component of a competitive strategy and in an effort to revitalize the ceramics industry, SLACC intends to launch an industry-wide program for productivity improvement focusing on Total Productivity Management (TPM). TPM is becoming an industry standard and it is an approach to optimize the effectiveness of the production process in a structured manner.

Recent Successes, Events and Activities

An agreement to establish a Coir Research, Development and Training Centre (the ‘Model Mill Project’) was signed between the Coir Council International (CCI), Coconut Development Authority (CDA), Coconut Research Institute (CRI) and the project executing agency, Industrial Technology Institute (ITI) in 2005; officially launched in October 2005; and the ceremonial laying of the foundation was held on November 13, 2006 with plans for the Mill to begin operations in 2007. Funding is from the Common Fund for Commodities (CFC) approved grant funding totaling US$480,373 (approved in May 2004) and the Sri Lankan counterparts in the project; CDA, CRI (US$169,027) and CCI (US$81,365) The Model Mill is located on 3ha of a 10ha coconut estate in Dunkannawa owned by the CDA, near Marawila - 50 km North of Colombo.

In 2006, the cooperation of the Sri Lankan coir industry with German partners has helped expand the use of coir in technical applications. TCP facilitated initial cooperation of German supplier Bafa with local suppliers.

As a result of the cluster concept promoting industry-R&D partnership and the Industrial Technology Institute’s participation in the cluster, several coir research projects have been contracted to them. From a basic characterization study of coir in 2001, ITI has repeatedly been engaged by industry for many basic and applied research projects individually and as a cluster. These include

	Modified coir pith for environmental applications – oil absorption water repellant
	New bio-pot using coir pith with high water absorption capacity and strength for horticulture industry
	New bleaching technique for coir

In Feb/March 2006, the wooden two-meter loom (appropriate technology for village level weaving) was manufactured and work on the automation process of the 2m loom commenced soon thereafter. A demonstration of the 2m loom was made to the industry on July 7, 2006.

One of the sector strategies identified by the coir cluster focuses specifically on Erosion Control Products (ECPs) made from coir. Following a business linkage tour for industry participants to the U.S. in February 2004, partnership opportunities were identified for product development with three U.S. manufacturers (Earthsaver, Yolo, CA; Fiber Marketing International Inc, Renton, WA; and Greenfix America, 22 Calipatria, CA). An initiative to include Sri Lankan ECPs in selected American Department of Transportation (DOT) specification documents that provide access to the vast U.S. highway/terracing construction market was also identified.

Two research papers were submitted for publication; one of which titled "Characterization and Determination of Properties of Sri Lankan Coconut Fibers" was published in the Journal of Natural Fibers Volume 2, Number1, 2005. The other paper titled “Modified Coir Pith as an Oil Absorbent” is pending publication in the Journal of bio-resource international.

ITI submitted a concept paper to ADB for a pilot project on a product development and technology transfer center catering to the SMEs in the coir sector, which has been accepted in principle. The proposal also seeks to establish prototypes for Erosion Control and Composite Product Development and upgrade, both of which have been areas where TCP has facilitated exposure or training for ITI staff in the past.

To assist the Sri Lankan coir industry reach global competitiveness, the coir industry in Sri Lanka and representatives of relevant government agencies - the ‘coir cluster’ - has been working with TCP to develop a well-formed strategy that will be competitively implemented and supported by technical assistance where required.

The core cluster group is represented by the following sectors of the industry value chain through their respective associations: Coconut growers, the initial link of the supply chain; fiber millers, the primary producers of raw fiber and pith; manufacturers and exporters of fiber and value-added goods, such as floor coverings, brooms and brushes; research, academic and semi-governmental organizations. The public sector is represented through the Coconut Development Authority (CDA), the main government body overseeing coconut industry policy and the Ministry of Industries.

Bringing a diverse group of stakeholders together and developing an industry strategy was a first for coir. The different players in the sector, particularly the millers and exporters, have traditionally had conflicting agendas. Therefore building sufficient trust and mutual interest between these parties to develop a common strategy was an achievement by itself.

Benchmarking: Strategizing was preceded by a benchmarking exercise that ranked the coir industry in Sri Lanka against other global competitors.
Strategy: Improving competitiveness and profitability of the coir industry in Sri Lanka

TCP works with the Sri Lanka coir industry to implement this strategy with a focus on:

Study Tour of India
A ten-member group was sent to India for 9 days to conduct a study of the coir industry in India including attending coir fair and seminar. (October 2001)

Strategy for the Coir Industry
Gero Leson facilitated the development of a strategy for the industry following meetings and workshops with stakeholders (January 2002); leading to the development of a road map for enhancing industry competitiveness (August 2002)

R&D Strategy
Gero Leson developed an R&D strategy for coir to help build competitive research capabilities in process and product development including potential links with overseas research institutes. (February 2002)

International Coir Convention
Gero Leson completed a report on the International Coir Convention indicating outcomes and follow up. (July 2002)

Coir Industry Overview
Neil Fernando completed a report analyzing the local coir industry to determine factors inhibiting its growth. (September 2002)

Composite Research Training in the Netherlands
Chandana Katugaha was sent to University of Delft in the Netherlands for two months training. This was part of a larger Common Fund for Commodities (CFC) funded research program on coir composites. (April 2003)

Erosion Control (ECP) Industry
Michael Harding completed a report on the US erosion control industry identifying market opportunities for coir. (July 2003)

FAO Hard Fiber Group Sessions
Indrajith Piyasena was sent to the thirty-second session of the intergovernmental group on hard fibers in Brazil to lobby Common Fund for Commodities (CFC) assistance for a coir research mill and training project in Sri Lanka. (July 2003)

Joint Research Projects
Gero Leson completed a report assessing, prioritizing and developing joint research projects with potential partners in Sri Lanka and abroad for new coir products & operational / quality improvements. (July 2003)

Apex Council
Institutional Specialist, Nick Hahn and legal consultants, Suresh Chandra Rajaratnam and Dilum Abeysekera, developed recommendations for an industry apex association. (December 2002 & September 2003)

Apex Council -Team Building
3rd Wave consultants facilitated a team building and work-planning program for the apex body board members. (March 2004)

Erosion Control – Product Market Development
Michael Harding and Gero Leson facilitated a product/ market development program, including a business linkage tour, to promote exports of Sri Lankan erosion control products in the United States. (June 2004)

Tsunami relief – Assessment of Damage and Development of a Strategy for The Devastated Coir Industry in the Coastal Belt
Assessment of damage caused by the tsunami to the coir industry in the South was carried out in February/ March 2005. In additional to technical assistance TCP joined hands with the Coir Council International (CCI) and USAID to distribute 750 coir-spinning reels and 25 Kgs of fiber to women who had lost their livelihoods during the Tsunami of December 26. TCP / USAID subsequently sponsored manufacture of 500 spinning reels. (March 2005)

Follow up on Erosion Control Initiative for the US Market
TCP sponsored Gero Leson’s participation at the International Erosion Control Association’s (IECA) annual convention in Dallas, Texas to make a presentation on describing the coir ECP initiative for the US and the affect of the Tsunami on the coir industry. (February 2005)

Coir Industry Supply Chain Evaluation
Jagdesh Mirchandani commenced a supply chain study of the coir industry, to determine loss in value as a result of prevailing production practices. (in progress as at March 2005)

Setting up a Test Mill and Coir Training Center
Achievement: Successfully lobbying international grant funding to develop, test, demonstrate and, implement advancements in the primary production of coir. Upgraded technology and training are expected to improve fiber quality, reaping a 15% price premium and up to 20% improvement in productivity in primary processing units. The project will train 500 mill staff and 50 managers per annum on site, becoming the first dedicated training center for coir in Sri Lanka.

Quality and consistency of coir fiber must be improved considerably at the bottom end of the value chain if coir production in Sri Lanka is to grow and be a source of employment. As in most countries, Sri Lanka’s coir industry relies heavily on low-cost rural labor and small mills for fiber production. Small coir fiber mills form the backbone of the industry, yet suffer from low levels of productivity and declining profitability. Additionally, working conditions in the mills and downstream operations are relatively harsh and have become an obstacle for recruitment of qualified workers. Thus the development, implementation and dissemination of low-cost advanced technologies, improved operating practices for coir and training would provide small enterprises with tools for meeting these challenges.

To address these issues, the cluster took the initiative to develop a project proposal for setting up a test mill and training center in partnership with relevant public sector institutions. The cluster and its successor, the Coir Council International (CCI), took a lead in lobbying counterpart funding for this initiative. As a result of CCI’s efforts, the Common Fund for Commodities (CFC) has approved a grant of US$ 480,373; the Government of Sri Lanka through the Ministry of Plantation Industries, Coconut Development Authority (CDA) and Coconut Research Institute (CRI) has pledged US$ 169,518; and the private sector has pledged investment of US$ 81,365 for this project.

The Industrial Technology Institute (ITI) was identified as the research partner and Project Executing Agency. Industry has invested US$ 30,000 on pre-evaluation of existing mill technology. The CCI is currently in discussion with the CDA to get the project started.

Coir Erosion Control Product and Market Development
Achievement: Targeted additional sales of US$ 150,000 per annum in the US through increased volumes and value of Sri Lankan coir-based EC product exports.

One promising application for coir is for its use in erosion control products due to coir’s superior resilience/absorbency and eco friendly properties. A study of the US Erosion Control market, conducted with a view to expanding the reach of Sri Lankan Erosion Control Products (ECP) in the United States, revealed several key obstacles. To address these findings, the coir cluster formed an Erosion Control committee, that put an initiative together to promote visibility and acceptance of Sri Lankan coir based ECPs with public and private decision makers in the United States.

A business linkage tour (industry funded) to the US in February 2004 resulted in forging alliances with strategically selected companies willing to partner with Sri Lanka. Ten US states and twelve coir EC products, with highest potential, were prioritized for specification sheet development and US Department of Transportation (DOT) approval (a prerequisite for EC products use in the US). The industry has invested US$ 2,500 plus stocks for testing and specification sheet development with the local research partner, the Industrial Technology Institute (ITI). Samples have been coordinated for shipment pending DOT submittal by April 05.

Three new product proposals were developed and potential partners identified for the joint development of novel coir-based products and applications. Initial samples were sent to partners for pre-evaluation of raw material suitability, machine compatibility etc. Industry funded a US$ 9,500 research on coir absorption properties at the ITI complimenting these efforts in December 2004.

CCI is currently lobbying co-funding for physical testing in the US. The Sri Lanka Export Development Board (SLEDB,) understanding the national value of the initiative, has pledged US$ 26,000 for the program. This initiative calls for additional strategic assistance to implement quality standards for participating industry members and a marketing campaign initiating a quality label / branding for “Sri Lanka Coir” in order to reap the full benefits of this program. In addition the industry is also working towards strengthening the supplier base, building accredited testing capabilities locally and promoting a local market for coir EC products.

Industry Apex Association - “Coir Council International” (CCI)
Achievement: Facilitating the launch of CCI, an industry association, working toward a common objective of creating more value and thereby more prosperity in the Sri Lanka coir industry through collaborative efforts of all stakeholders, in both the private and public sectors.

To jointly address challenges faced by the industry, members with representation from all stakeholders of the value chain founded the coir cluster under the auspices of TCI. Realizing the value of coming together as a forum for the entire industry the cluster decided to formalize its position by incorporating the CCI in November 2003.

The Council, which now serves as the apex body for the Sri Lanka coir industry, takes leadership in industry strategy and strategic initiatives and liaises with TCP and other partners in furthering these initiatives.

International Coir Convention
The Sri Lanka coir industry successfully organized a two-day international coir convention for the first time in Sri Lanka under the patronage of FAO on the 13th and 14th of June 2002 under the theme, ‘Beyond Nature’s Versatility, Towards Global Excellence.’ The convention, attended by 148 participants from 14 countries, had a total of 12 papers presented by local and foreign experts.

Hosting the convention reinforced Sri Lanka’s position as a key driving force of the global coir industry. The convention was also a key-deciding factor for CFC (Common Fund for Commodities) to fund a fast track project to research the technical potential of coir in advance composites. This initiative was co-funded by the CFC, Industry, the Coconut Development Authority and TCP.

Industry achievements since TCP’s establishment that have been helped by TCP activities

Coir Composites
Fibre Composites in Europe are showing double-digit growth rates. Being a less expensive natural fibre, coir has potential in this area provided that it is found to be technically competent. With a view to identifying its suitability, exploratory research on the potential for coir in advanced composites was jointly conducted between University of Delft, Holland and ITI, Sri Lanka. This research was funded through the CFC and co funded by the industry. TCP supported training for an ITI research officer at Delft. Initial trials indicate that locally available coir fibre can be used in advanced composites, but require further industrial scale trials to assess financial feasibility and technical optimization.

Joint R&D projects
TCP has worked closely with industry to build a local research base for coir. The cluster provided the forum for industry players such as the Industry Technology Institute (ITI), Coconut Research Institute (CRI) and universities to come together for coordinated research on coir. Several such research projects have commenced since the formation of the cluster.

Standards
Industry has been lobbying for coir standards given its importance in global markets. Results from an industry funded (US$ 20,000) coir characterization study were used as the basis to revise existing standards. Although coir standards have not yet been adopted in Sri Lanka, the industry’s lobby has brought the importance of standards to the forefront with government authorities agreeing to take a lead on it.

Common Fund for Commodities (CFC)
The CFC co-funded several cluster programs including the International Coir Convention (2002) and the coir composite research study. Furthermore, they have approved a grant of US$ 480,373 for the proposed coir research and training mill.

UNIDO
With a view to building accepted testing capabilities starting with erosion control products, UNIDO was approached for establishing an accredited coir lab at the ITI. The proposal forwarded to UNIDO for its assistance, has principally been accepted. Once implemented, this dedicated coir lab has the potential of being a center for further product development, research and quality testing of coir EC products.