The global textile market value is estimated to be US$
4.50 trillon during the year 2008. It is observed that
clothing accounted for about 60% of the market, while
textile accounted for the balance 40%. The global
textile industry grew at an estimated average annual
rate of about 2.5% during 2000-2008. The global slowdown
has also affected Textile industry adversely. The global
fibre demand has decreased by one percent in 2008. It is
also observed that the global textile and clothing
industry can be broadly divided into Natural Fibre and
Manmade Fibre industry. The Natural Fibre industry
includes Cotton, Wool, Silk and Jute; while the manmade
Fibre Industry includes Polyamides, Polyester,
Polyethylene, Viscose and Acrylic to name a few.
Global Fibre Scenario
The global fibre demand in 2003 was 641 Lacs MT. The
demand for fibre grew at a CAGR of 5.05% to reach an
estimated 807.50 Lacs MT during 2008. It is noted that
during the same period, demand for natural fibre grew at
a CAGR of 4.65%, while the demand for manmade fibre grew
at CAGR of 5.38%.
Future Outlook of POY / PFY Industry PFY Demand in India
The domestic demand for PFY stood at 10,14,755 Tons
during the year 2003. The demand for PFY grew at CAGR of
4.21% to reach an estimated 12,88,523 Tons by the years
2008.
PFY industry, as we know, had faced difficult market
conditions during the years 1999-2002 due to excess
capacity over demand which lead to cut throat unhealty
competition causing substantial erosion in profitability
of these companies. However, as now new capacities came
up during this period, the gap between supply and demand
got gradually bridged up and POY manufacturing
units/companies are doing reasonably well since
beginning of 2002 and are expected to do much better
during the next few years in view of the sustained
demand growth.
As per detailed survey conducted by 'CRISINFAC' the
domestic Polyester industry is likely to witness robust
demand growth and higher profit margins in the next five
years due to the following positive factors favouring
Polyester industry.
Price Competitiveness of Polyester viz-a-viz
other substitutes like cotton, silk and woolen yarns. Excise duty reduction to encourage demand :-
Excise duty on POY has been progressively reduced over
the previous few years to 16% and is expected to be
reduced further which will further increase the price
compititiveness of POY. Increase of PFY in non-appael segments :- In
India, fibre is mostly used for textile applicaions i.e.
93% and only 7% for non-apparel applications like home
textiles, automotive an industrial segments as against
59% worldwide. The demand of non-apparel segment is
expected to grow @ 20% p.a. as Polyester offers high
tenacity an strength which is most suitable for such
applications. Lower per capita consumption :- The averageper
capita consumption (PCC) of fabric in India is much
lower than in its neighbouring countries. India has a
huge potential market, given that its PCC is as low as
1.4 kg as compared China (5 kgs), Pakistan (3 kgs) and
Indonesia (5 kgs). India has the advantage of a large an
growing domestic market, and a good GDP growth. Rapid urbanization :- higher spend on clothing :-
In India, out of the total population, about 70% is
rural. Behaviour patterns suggest that most of the
fabrie demand in this segment is need-based. The urban
demand, on the other hand, is also driven by fashion
trends and favours more sophisticated textiles, and
variety in designs and colours. The average urban spend
on apparel is higher than rural spend.
However, over the years, the clothing pattern in India
has shifted. Men's clothing consumption has moved from
the traditional cotton based wear to synthetic fabrics.
Cotton dhoti are giving way to trousers (mostly made of
polyester or polyester blends). Likewise, women are
moving from cotton saris to synthetic saris/dresses. Levy of Anti-dumping duty on import of POY to
lower threats of import leading to availibility of
better contribution to domestic manufacturers. Rapid additions in downstream processing facilities
leading to incremental demand. Manufacturing of manmade fibres globally is getting
shifted mainly to China and India. As China's
domestic comsumption almost matches its production,
India will be able to increase its presence in the
International market.
Keeping in view the strong fundamentals mentioned
above, CRISINFAC has projected th POY industry grow at a
healthy 7.8% Compounded Annual Growth Rate (CAGR).
