There are about 850 small scale detergent manufacturing units in Gujarat which employ approximately 30,000 workers. (File/Representational)The associations of small scale detergent manufacturing industries in Gujarat on Saturday announced that 80% of their approximately 850 units had been shut down and the remaining, which are running on depleted stocks of raw materials, are also likely to shut down shortly as the costs of raw materials have increased by three times the cost, making production unfeasible.The Gujarat Small Scale Detergent Manufacturers Association, and the Soap and Detergent Association Gujarat on Saturday announced the closure of the majority of the industry citing the cost of LABSA (Linear Alkyl Benzene Sulphonic Acid), also known as Acid Slurry, the main component of detergent, had gone up from Rs 105 in November 2025 to Rs135 in February 2026, had risen to a whopping Rs300 per kg in March after the beginning of hostilities between the US and Israel on one side and Iran on the other, which led to the blockade of the Strait of Hormuz, cutting off about 20% of global oil supply.Notably, it is not just the price of LABSA, a petrochemical, that has gone up, but also Soda Ash and plastic packaging, that has led to such crushing pressure on the industry that they began shutting down from March 15, and had led to 80% of the units suspending production by April 11.Speaking to The Indian Express, Naresh Jain, Chairman of Gujarat Small Scale Detergent Manufacturers Association (GSSDMA) termed the situation as an existential threat to these industries.“We are facing a major problem in procurement of the major component of detergent, which is LABSA, also known as acid slurry. This is because the prices of this raw material have gone so high that the companies cannot purchase it at current rates as the finished product cannot be sold in the market at the equivalent price point change. This has led to a shutdown of 80% of the industry, leaving only those with previous stocks still functioning till the time the material lasts,” he said.On the pricing problems, Jain said, “We were getting LABSA at about Rs135 per kg. After the war in West Asia began, the prices kept going up and today, it has reached Rs300 per kg. Further, the price of Soda Ash increased by Rs 6,000 per tonne, and plastic packaging cost went up by 50%. We could earlier provide 200-225 gram detergent for Rs10. Now we cannot even give 125 grams for Rs10.”Supply chain disruptedThe supply chain in the detergent industry is that the petrochemical Linear Alkyl Benzene (LAB) is first produced in the refineries using Kerosene and Benzene. It is primarily manufactured by IOCL, Nirma Ltd and Reliance, said the association leaders.Story continues below this adTheir product – LAB – is then sold to Sulfonators, in whose units it is “sulfonated” using Sulphuric Acid, resulting in the formation of LABSA. This is then sold to detergent manufacturing facilities.At the detergent units, LABSA is mixed with Soda Ash, Silicate and fillers, to finally make detergent – the finished product – which is sold in the market.Scale of Industry and Cost to ConsumerThere are about 850 small scale detergent manufacturing units in Gujarat which employ approximately 30,000 workers. It accounts for 60% of the rural market and 15% of the urban market, the latter of which is dominated by the major companies and MNCs.The production cost of detergent cakes cost about Rs 25,000-28,000 per tonne. When you add on 18% GST, packaging and transport costs, it finally reaches the consumer at Rs 40,000 per tonne or Rs 40 per kg.Story continues below this adAppeal to Government, Petrochem CosThe Associations said, “The detergent industry associations humbly appeal to the government to intervene. If a 20% to 30% quota of raw materials is reserved specifically for MSME units, the industry could be revived. We also expect Acid Slurry (LABSA) manufacturers to act with humanity and provide supplies at reasonable rates. If a solution is not reached soon, the upcoming Diwali festival will be filled with darkness for thousands of workers.”Brendan Dabhi works with The Indian Express, focusing his comprehensive reporting primarily on Gujarat. He covers the region's most critical social, legal, and administrative sectors, notably specializing at the intersection of health, social justice, and disasters. Expertise Health and Public Policy: He has deep expertise in healthcare issues, including rare diseases, Antimicrobial Resistance (AMR), the complex logistics of organ transplants, and public health challenges like drug-resistant TB and heat health surveillance. His on-ground reporting during the COVID-19 pandemic and Mucormycosis was critical in exposing healthcare challenges faced by marginalized communities in Gujarat. Social Justice and Legal Administration: He reports on the functioning of the legal and police system, including the impact of judicial philosophy, forensics and crucial administrative reforms (. He covers major surveillance and crackdown exercises by the Gujarat police and security on the international border. Disaster and Crisis Management: His work closely tracks how government and civic bodies respond to large-scale crises, providing essential coverage on the human and administrative fallout of disasters including cyclones, floods, conflict, major fires and reported extensively on the AI 171 crash in Ahmedabad. Civic Infrastructure and Governance: Provides timely reports on critical civic failures, including large scale infrastructure projects by the railways and civic bodies, as well as the enforcement of municipal regulations and their impact on residents and heritage. ... Read MoreStay updated with the latest - Click here to follow us on Instagram© The Indian Express Pvt LtdTags:Petrochemicals