Going At Current Pace Polyester Will Be In Surplus By 2018 [ 22 Oct, 2013]
A recently released ‘Polyester Chain Report: 2013” predict surplus supply of polyester filaments as well as staple fibre in 2018. The US$75 billion polyester industry continued to re-main as an undisputed leader in the textile Industry. Year 2012 saw its market share in-crease to over 80 per cent given the continuing growth in population and consistent improvement in standards of living, particularly in emerging economies and the fast growing mass markets. Demand for textile products has been growing for years. In the early 1980s, just 8 kg of textile fibres were consumed per capita per annum and by 2012, this has risen to 12.2 kg, implying an increase of 53 per cent in per capita use in the past three decades.
Global polyester staple fiber production is estimated to touch 17.9 million tons by 2018, as compared to 14.6 million tons in 2012. However, this will be marginally in surplus to the predicted demand in 2018. Asia, alone will have a surplus of close to 2 million ton which will be consumed by other regions in deficit. Similarly, going ahead, demand for polyester filament yarn is estimated to touch 37.5 million ton in 2018 while supplies are likely to grow at an annual rate of 4.5 per cent to 38 million, thus leaving a surplus of about half a million ton.
In 2012, the US$24 billion polyester staple fibre industry saw prices declining rapidly while production capacities reached 20.5 million ton as of 1 January 2013. 90 per cent of this addition happened in Asia alone with China as the main contributor. Production capacity of polyester filament industry expanded 4.4 million tons in 2012, taking the total capacity to 38.7 million tons. Asian region accounted for the entire capacity expansion and accounted for close to 94 per cent of global capacity. Production grew 9.4 per cent in 2012 reaching 29 mil-lion tons, just below the 11 per cent growth seen in the previous year. The growth was primarily driven by Asia while West Europe, CIS and Middle East region reporting declines. Production in America appear to rebound, somewhat.
China is the largest producer and consumer of polyester. It produced over 30 million kgs of polyester, including 9 million kgs of staple fibre and 21.5 million kgs of filament.
Cheap Polyester Spurs Cut To Cotton Price Hopes [ 04 Sep, 2013]
The International Cotton Advisory Committee cut its forecast for cotton prices for a third time, as it downgraded demand estimates, even as US officials cautioned that hopes for Chinese imports may be too large.
The ICAC, an intergovernmental group, downgraded by 5 cents a pound to 103 cents a pound its forecast for average 2013-14 cotton prices, as measured by the Cotlook A index of physical values.
The move by the ICAC, which had in May forecast prices averaging 122 cents a pound, reflected a caution that in China, the top cotton consuming country, demand was being undermined by competition from alternative fibres.
"During August, the Cotlook A Index averaged approximately 93 cents per pound, while polyester in China averaged approximately 76 cents per pound," the ICAC said.
"This is a substantial difference in a high volume, low margin business like yarn spinning and thus, cotton is expected to continue to lose market share this season."
The comments echo a caution last month from cellulose fibres group Lenzing.
The fall in Chinese cotton consumption was being made up to some extent by use elsewhere, with the committee flagging a "significant shift in mill use to other countries".
Even so, the group lowered by 280,000 tonnes to 23.72m tonnes its forecast for world consumption in 2013-14, which started last month, citing downgrades to estimates for Indian and Pakistani demand.
World stocks were seen rising by 1.82m tonnes over the season, up from a previous forecast of a 1.59m-tonne increase.
The ICAC forecasts included an estimate of a cut of getting on for 1m tonnes in imports by China, also the top cotton buyer, reflecting reduced consumption.
Separately, the US Department of Agriculture's Beijing bureau forecast a slump of some 2m tonnes to 2.2m tonnes (10.1m bales) in Chinese cotton imports in 2013-14 "as massive stocks impact demand".
A Chinese support programme, which is being reviewed, gives farmers a guaranteed price for cotton well above the international market rate has seen the country build up massive reserves, as mills are forced to cheaper imports, or run at levels well below capacity.
Indeed, "due to yarn's low price and no quota limit", Chinese textile groups have turned to buying abroad, taking yarn imports to 888,000 tonnes in the first half of 2013, up 47% year on year.
The bureau's forecast for Chinese cotton imports is below an official USDA estimate of 2.40m tonnes (11.0m bales).
In New York, cotton futures for December delivery stood 0.4% higher at 83.03 cents a pound at midday local time (17:00 GMT), helped by a deterioration in the condition of the US crop.
USDA data overnighted rated the crop as 45% in "good" or "excellent" condition as of Sunday, down 2 points week on week.
The Cotlook A index stood at 88.75 cents a pound, down 0.65 cents on the day.