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Technical Textiles in China: Opportunity or Threat?

From: ASAP

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China’s consumption of technical textiles is set to soar. This could provide an opportunity for foreign companies to export to the country -- but only if they act quickly, according to a new report, World Markets for Technical Textiles: Forecasts to 2010, published by Textiles Intelligence in the latest issue of Technical Textile Markets.

Although China is seen as a threat, there may be significant opportunities for foreign manufacturers to export to the country as demand for technical textiles soars.

China’s growing domestic demand for technical textiles extends to a number of sectors. Demand for technical textiles for use in its infrastructural development, for example, is set to soar as the Chinese economy expands -- spurred by the country’s accession to the World Trade Organisation in late 2001.

Rapid growth in clothing exports is already fuelling demand for technical textiles used in clothing components. According to the report, which was written by UK-based management consultants David Rigby Associates, “consumption will become increasingly focused in low cost garment assembly locations in China, South-East Asia, and South Asia as well as areas serving the US market such as Mexico, Central America and the Caribbean.”

China is also fast developing a consumer society. And with the development of a consumer society will also come growing demand for technical textile products such as feminine hygiene items and diapers, as well as demand for higher standards of medical care and the resulting uptake of disposable bed sheets and surgical drapes, gowns and caps.

Demand for technical textiles has also been spurred by rapid growth in the microelectronics industry. This has led to increased demand for, among other things, clothing for cleanrooms.

Perhaps the greatest impact, however, will be felt by the growing thirst for car ownership. This will provide markets for technical textiles in car manufacture. Growing car ownership will also result in a need to provide more roads and other infrastructure projects, which will generate further demand for technical textiles.

Opportunities for foreign suppliers in the Chinese market have been limited in the past because the Chinese market has historically been hard to penetrate. However, China is now obliged to lower its barriers to imports in accordance with rules governing its accession to the WTO. Penetrating Chinese markets will therefore become easier as those markets become more open.

At the same time, the climate for foreign investors in China is being liberalised—again in accordance with the requirements of WTO membership. This will provide opportunities for foreign firms to establish production facilities in the country.

However, China has shown its determination in the past to maximise its self sufficiency -- as in the case of its man-made fibre industry. In 2002 alone Chinese output of man-made fibres rose by almost 21% and, as a result, China accounted for almost 30% of world output last year. In the case of polyester textile filament yarn, Chinese production expanded by a dramatic 22%. As a result, China now accounts for about 40% of world output.

Furthermore, as China’s man-made fibre industry has expanded, it has invested in new capacity. Consequently, China’s equipment is now mostly state-of-the-art.

What is also worrying for producers in developed markets is the fact that companies in China are increasingly expanding into speciality areas also chosen by producers in industrialised countries in an attempt to avoid competition from low cost countries.

No doubt China will seek to repeat the strategies it has employed in man-made fibres when developing its technical textile industry. Furthermore, as its technical textile industry expands, China will eventually be in a position to turn the tables and become a major exporter of these items to the world’s markets in its own right.

Ends.

“Technical Textiles: A Safe Haven for Producers in Developed Countries”, “Worldwide and Regional Trends in Man-Made Fibre Production” and “World Markets for Technical Textiles: Forecasts to 2010” are all published in Technical Textile Markets, No 53, 2nd quarter 2003. Other reports in the same issue include: “Profile of Ten Cate: Leader in the Netherlands Technical Textile Industry”, “Profile of Acordis Speciality Fibres: Focus on Technical Textiles for Medical and Hygiene”, “Global News Round-Up”, and “Statistics: Fibre Consumption in South America”.

Technical Textile Markets is a quarterly publication from Textiles Intelligence Limited. It provides business and market analysis of worldwide trends in man-made fibres, technical textiles and industrial textiles manufacturing, trade and distribution. The 2nd quarter 2003 issue of Technical Textile Markets costs Euro375 (Europe, Middle East or Africa) or US$375 (Americas or Asia Pacific) and is available from Belinda Carp at Textiles Intelligence, International Subscriptions, 10 Beech Lane, Wilmslow SK9 5ER, United Kingdom. Tel: +44 (0)1625 536136; Fax: +44 (0)1625 536137; Email: [email protected]

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