Camlin Fine Sciences Diphenol Plant Shut Down Due to Geopolitical Issues; Fire Incident Reported
Camlin Fine Sciences is shutting down its Diphenol Plant from May 24, 2026, due to raw material constraints and geopolitical issues. A fire incident on May 23, 2026, caused an estimated loss of ₹2 crore, covered by insurance. The company expects to restart Ethyl Vanillin production within 48 hours, with no anticipated impact on downstream sales.
The shutdown of a plant contributing over 5% of turnover, coupled with a fire incident, necessitates careful management. However, the company's proactive measures, import strategy for raw materials, adequate inventory, insurance coverage, and plans for a swift restart of other operations limit the overall impact.
While the shutdown due to external factors and a fire incident are negative events, the company has mitigated the impact by securing raw materials through imports, having adequate inventory, and expecting a prompt restart of its Vanillin production. The insurance coverage for the fire incident also reduces the financial blow.
Camlin Fine Sciences Limited announced the shutdown of its Diphenol Plant located in Dahej SEZ, Gujarat, effective May 24, 2026. This decision stems from the current geopolitical issues and economic environment, which have severely constrained the availability and prices of key raw materials for the plant. The company had already reduced capacity utilization and initiated shutdown steps. The shutdown is not expected to impact the production of downstream Straight products as Hydroquinone has been secured through imports, and adequate Catechol inventory is available for Aroma products. The company is exploring repurposing the Diphenol Plant, with restart evaluation contingent on improvements in the economic and geopolitical landscape. The turnover of the Diphenol Plant for FY2024-25 was ₹4,352.47 lakh, representing 5.06% of the company's total turnover. The majority of Hydroquinone and Catechol produced were for internal downstream use.
Furthermore, a fire incident occurred at the Diphenol Plant on the night of May 23, 2026, around 11:30 p.m., reportedly caused by a leakage of high-temperature thermic fluid. The fire was controlled and extinguished within an hour by 12:30 a.m. on May 24, 2026. Due to the ongoing shutdown process, operations personnel were able to promptly contain the fire, preventing escalation and ensuring immediate evacuation without serious injuries. As a precautionary measure, the Vanillin facility, involved in Ethyl Vanillin production, was temporarily shut down.
The preliminary assessment indicates a loss of approximately 30 MT of Catechol inventory and damage to a flaker machine, electrical cables, measuring instruments, and insulation, with an estimated loss of ₹2 crore. This loss is adequately covered by insurance, and the company is initiating the claims process. Regulatory authorities have been informed, and measures are in place to prevent environmental hazards. The company plans to restart Ethyl Vanillin production within the next 48 hours and does not anticipate any impact on sales of downstream Straights and Aroma products.
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