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Nonwovens

Review and prospect on nonwovens industry of China

Written by: Fibre2Fashion

The nonwoven fabric, oneof the essential raw materials for industrial textiles, is widely used in suchindustries as medical health, filtration/separation, earthwork/buildingconstruction, and automobiles, with incomparable cost-effectiveness and extensiveapplication bestowed upon such fabric featuring special functional structureand high-efficient production processes. In the past years, the increasingdemands have boosted the rapid growth in production and consumption of nonwovenfabric across the world. In spite of intricate circumstances at home andabroad, the nonwovens industry in China witnessed growth throughout the year2016, accompanied by positive momentum in economic benefits, writes Eric(Chuanxiong) Zhang, Secretary-General, China Nonwovens & IndustrialTextiles Association.

I.Current Development

1.Production

Judging from statisticaldata released by China Nonwovens & Industrial Textiles Association (CNITA),the output of nonwoven fabric all over China totalled 5.263 million tons throughout2016, up by 8.5 per cent compared with the same period in the previous year,which indicates rapid growth. However, the rate of increase was slightly lowerthan that in 2015. Region-wise, large-scale enterprises based in ShandongProvince-the biggest contributor to the aggregate fabric output inChina-together produced 947,000 tons in 2016, showing a drastic increase innonwoven fabric output all over the province, due to increased productioncapacity owing to surging investments in earthwork and waterproof base fabricof roll goods. Another reason is that several traditional textile manufacturersin Shandong have shifted their businesses to the nonwovens industry, which hasgiven birth to massive investments, state-of-the-art equipment, and high productioncapacity on the single production line. In Guangdong and Jiangxi provinces, theoutputs have risen at around 10 per cent, while provinces like Zhejiang, Fujianand Anhui have registered the growing output at approximately 15 per cent. Inthe case of the eastern coastal area-the predominant production area ofnonwoven fabric in China, the nonwoven fabric production here accounted for70.2 per cent of the total production across the country. The rate of increasein output also remained at high level as before. Due to the leading industry ofdisposable medical textiles in central China, western China and Hubei Province,the nonwoven fabric generated in these regions has reached 408,000 tons;provinces like Henan and Sichuan still hold the rapid output growth, though theoutput in such provinces only takes up tiny percentages of the aggregatethroughout the whole country.

2. Investment

The diverse demands andrapid growth of nonwoven fabric have opened a door for periodically proactiveinvestments in this industry. In 2016, the actual fixed investments in thenonwovens industry amounted to RMB 30.622 billion across China, rising by 13.87per cent year-on-year, while the increase rate in 2014 was 44.2 per cent as thepeak value in recent years. Usually, it takes about one year to put nonwovenfabric production lines into service after investments, during whichenterprises absorb newly increasing production capacity. Therefore, it's safeto say the investment growth rate in 2016 has tended to rebound after the dropin 2015, and it is anticipated that the investment in the nonwovens industrywill continue to increase at a powerful momentum in 2017.

 

With reference to CNITAdata on several equipment manufacturers, 152 new needling production lines weresold throughout the year 2016 for China's industrial textile industry, togetherwith 33 new stitch-bonding production lines and 19 new hot-air/thermalcalendaring production lines, which denotes that this industry still acts as amagnet to investments.

3.Economic Benefit

In past years, thenonwovens industry has firmly clenched strong profitability. As shown instatistics released by National Bureau of Statistics of China (NBSC),large-scale nonwoven fabric enterprises have totally earned RMB 155.84 billionfrom main business and RMB 9.93 billion as profits, respectively up by 7.67 percent and 8.23 per cent, with the profit rate at 6.38 per cent. The loss amountof unprofitable industrial enterprises has decreased by 43.32 per cent, whichsignifies that the profitability of this industry is further enhanced by moretechnical value added from progressive industrial science and technology, andis even elevated by the uninterrupted industrial development due to thebenignant circle arising out of production capacity increase, inventoryreduction, and receivables decrease for business activities.

For China's nonwovensindustry, its main business revenues have witnessed considerable changes in thegrowth rate. Throughout the year 2016, the growth rate was 12 per cent lowerthan in 2012, while the overall production capacity has risen significantly inthe same period. The growth rate drop in main business revenues largely stemsfrom the encumbrance and even moderate diminishment upon sales prices ofnonwoven fabric, owing to the price reduction of raw materials likepolypropylene chips and polyester staple fibre driven by tumbling oil prices.

4. International Business

By the end of the year2016, China exported 821,000 tons of nonwoven fabric valued at $2.52 billion,respectively up by 12.25 per cent and 1.49 per cent. Despite the overallrecession in industrial textile exportation, China's nonwovens industry islargely expedited by quantity, and in turn, still takes up favourablepercentages of global market shares. From 2012 to 2016, the exported nonwovenfabric has annually increased by 14.08 per cent based on weight, higher thanthe annual average increase rate of export value. From the perspective ofexport prices, the unit price has risen at a low speed from 2012 to 2013, buthas declined since 2014. In particular, it has dropped by nearly 10 per cent in2016, with average export prices decreasing by 2.2 per cent in the last 5years.

The staple fibre-thedominant type of nonwoven fabric exported from China-enjoys the weight at 51.33per cent of the total weight. For spun-melt nonwoven fabric delivered fromChina, its weight shares 48.67 per cent of the aggregate throughout the year2016, with export value accounting for 43.7 per cent, slightly higher than in2015. From the angle of processes, the nonwoven fabric after treatments likedipping has generated export value at 44.31 per cent of the aggregate, and itsunit price is 41.82 per cent higher than that of nonwoven fabric without anytreatment, from which it can be understood that finishing plays a significantrole in pushing up the added value of nonwoven fabric.

On the basis of markets,Asia, the largest destination of nonwoven fabric exported from China, hasgenerated export value that increases by 2.49 per cent year-on-year, with thepercentage beyond 60 per cent of the total. Among other indispensable markets,European Union has imported China-made nonwoven fabric at 2.61 per cent higherthan in the same period of the previous year, while the quantity of such fabricexported to North America has declined by 3.9 per cent year-on-year, due todecline in export to the US.

In the case of sales fromChina to Latin America and Oceania, the export volumes have respectively risenby 5.45 per cent and 18.82 per cent respectively, compared with the same periodin the previous year. In 2016, however, the global economic depression hasimposed negative influences upon the development of exports to Africa, and as aresult, the export volume to this continent has declined by 18.96 per centyear-on-year. Nevertheless, Africa is still brimmed over with developmentpotentials on the whole, and is an optimum flowerbed for China's cost-effectivenonwoven fabric in the near future.

II.Industrial Development Tendency

Undoubtedly, China'snonwovens industry has witnessed a rocketing growth during the short period ofits development in China. In 2001, the production capacity was merely 569,000tons, only 10.8 per cent of that in 2016. Within 15 years, however, the annualincrease rate of production capacity has reached 16 per cent on average: theexport volumes of China's nonwoven fabric have ascended to 732,000 tons in 2015from 34,000 tons in 2000, lifting export value from $94 million to $2.49billion, respectively up by 22.58 per cent and 24.4 per cent on average. As forthe international business, China's market share has gone up to 17.6 per centfrom 2.1 per cent. As a result, China has today evolved as the largest countryin terms of production, consumption and sale of nonwoven fabrics globally.

The nonwovens industry inChina is enjoying the rapid development. One reason for this is China'stremendous demands for medical health, infrastructure construction andenvironmental protection, which have attracted investments of worldwide leadingnonwoven manufacturers to establish their company in China. Another reason isChina's enormous progresses in special raw materials, equipment and productionprocesses for nonwoven fabric, together with generation of specialised talentsfrom various educational institutions, who lent their hand to create completeproduction chains in China that have remarkably reduced producing costs. Forinstance, few overseas manufacturers other than Reifenhauser GmbH, a Germancompany, have no longer obtained any equipment orders from China for productionof high-end spunbonded fabric. Taken as an example, China's technicalbreakthrough in polyester reinforcement base fabric has boosted the vigorousincrease of production lines for such fabric, and in turn, strong substitution effectsare catalysed and imposed upon traditional reinforcement base fabric.Therefore, it's barely facile to replicate such well-developed industrialchains in regions full of producing costs, like Southeast Asia.

1.Domestic Market

1.1Medical Health Industry in Steady Growth

In coming years, marketswill retain its role-the prime driver to the growth of China's nonwovensindustry. From world perspective, the leading application of nonwoven fabriclies in medical health whose development is intimately correlated withpopulation and demographic structure. In China, the country with the largestpopulation in the world, the market of hygiene textiles is expanding due torising ageing population and birth rates that have slightly rebound sinceimplementation of the universal two-child policy. As a response to urbanisationand rising incomes, changes in personal consumption habits will be stimulated,and in turn, the market penetration rates of baby diapers, sanitary napkins,and adult diapers will go upward steadily, and eventually, tend to be the sameas in developed countries. In case of medical nonwoven fabric, the domesticmarket is still under incubation with possible large market shares and rapidgrowth due to the well-developed auxiliary medical insurance and applicableprocurement policies in the future.

1.2Engineering Application in Rocketing Growth

The special structureendows nonwoven fabric with extremely extensive application in the engineeringindustry. As the efficacious technology on environmental protection testifiedthrough verification on both domestic and overseas markets, baghouse dusting isfurther deeply applied in such industries as thermal power generation,steelmaking/metallurgy, cement, and waste incineration. With more efforts of China'sgovernments on environmental protection, the nonwovens industry will fall intothe large growth scope from aspects of air and water filtration. Likewise,industries like earthwork and building construction bring favourableopportunity that strengthens China's infrastructure. In addition, nonwovenfabric is broadly applicable in car interiors, carpets, thermal and soundinsulating materials, and filtration materials.

As for industries likepackages, cables, and home furnishing, it's inevitable to further research anddevelop numerous applications that nonwoven fabric has on the basis ofadvantages in cost and innovation in techniques.

1.3 Emerging Industries with Enormous Potentials

The micro-fibre basedfabric industry is also growing favourably. Despite the fact that markets andenvironmental policies have pushed down the overall synthetic leather industry,the superior performance is embedded in synthetic leather and its base fabricthat highlights the industrial development and massively replaces traditionalproducts. Huafon Microfibre (Shanghai) Co Ltd, the leading Chinese manufacturerof micro-fibre based fabric, has ordered 16 needling nonwoven fabric productionlines throughout 2016, including 10 Dilo production lines sourced from outsideChina. Additionally, nonwoven fabric is endowed with enormous potentials forthe wall cloth industry. Compared with common wall cloth, the ones made ofnonwoven fabrics are more advantageous in cost and performance, owing to theaccessible deep development in aspects of sound insulation, mould preventionand touch on the basis of stereo structure.

2. International Market

Since the industry iswell-developed, the international market has played a more significant role inChina's industry of nonwoven fabric, as the domestic market penetration rateincreases. In 2016, totally 732,000 tons of nonwoven fabric is sold from China,accounting to 14 per cent of the aggregate output, and even sharing higherpercentages of the needling nonwoven fabric exports. Markets in developedcountries have apparently spotlighted cost advantages and strongcompetitiveness inlaid in China-made nonwoven fabrics. Taking the US as anexample, Chinese nonwoven fabric almost didn't take up any market share in theyear 2000, while Japanese products shared 27 per cent. In 2016, nonetheless,Chinese products' share ascended to 23 per cent, while the market share ofJapanese goods shrunk to 8 per cent. More obviously, the advantages of Chinesenonwoven fabric have swelled in developing countries. In 2016, the nonwovenfabric exported to India, Indonesia, Vietnam and Philippines amounted to $480million beyond the aggregate from export to the US, Japan and European Union,rising by 4.96 per cent, compared with the same period in the previous year. Thisunveils the significant role and growth opportunity of developing countries inexport destination of China-made nonwoven fabric.

As a response to theadvancing 'One Belt One Road' Initiative, more investments from China in termsof infrastructure in countries along the 'Belt' and 'Road' will be seen. Alongwith that, the transferred production capacity of industries like garments,bags and shoe-making, developing countries will show their increasing demandsfor nonwoven fabric, which will, in turn, create favourable opportunities intrade and direct investments for China.

To sum up, China'snonwovens industry has been well-developed for over a decade. The enormousmarket of domestic demands still acts as the vast paradise for the industrialdevelopment in China. With benefits from both growing economy and increasinginfrastructure projects in developing countries, such markets are bound to begrowth points of China's nonwoven industry. Moreover, the technical innovationin aspects of equipment, raw material and processes for China's nonwovenindustry will give an impetus to new products and applications, with a view toeffective substitution for traditional products and unceasing market expansionfor nonwoven fabric. Therefore, it's safe to say that China's nonwovensindustry will embrace a marvellous future, and will never balk in achievinggrowth at a high speed. (JI Jianbing)

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