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World demand for all fibres likely to see recovery during 2003-2005

Arbind Gupta - Mumbai

Worldwide demand for all fibres, including cotton and manmade, is expected to stage a smart recovery during 2003-2005 period. This would take the final demand for fibres to 61.6 million tonnes in 2005 as against 53.1 million tonnes in 2001. The recovery assumes significance in the backdrop of a negative growth witnessed in 2001 when demand fell by 0.4 per cent from 53.3 million tonnes in 2000.

"We are now almost through with 2002, looking forward to 2003 and asking questions about demand for fibres in the lead-up to 2005, when phase IV of the ATC is set to eliminate quotas on imports of textiles and apparel in January of that year. We see final demand for fibres recovering slowly in 2002 to 54.7 million tonnes and then the recovery gathers pace back towards trend growth from 2003 to 2005," stated Mr Bruna Angel, fibre consultant, PCI-Fibres & Raw Materials.

Looking at the final demand for all fibres in the selected regions, China sustains high growth rates in 2001 and 2002 of 8.4 per cent and 5.3 per cent, slowing slightly to a still respectable 4.0 per cent in 2003 (domestic demand only).

In North America, final demand fell 4.2 per cent in 2001. "In 2001, the US imports of textiles and apparels were down by less than one per cent. Domestic mills took the brunt of the decline with mill demand for all fibres in North America down 9.6 per cent in 2001. Some recovery in demand for all fibres is expected this year, but since personal inventories of fibre and inventories all the way back up the pipeline are still high, growth is unlikely to return to the higher levels until at least 2003," said Mr Angel.

Data so far this year suggests that it is imports of textiles and apparels that continue to meet most of the growth in demand. China has been the main driver of this growth with US imports of textiles and apparel from China up 101 per cent in the eight months to August 2002 compared with a year earlier.

In India, following very slow growth in domestic demand for fibres in 2001, the outlook improves in 2002 with growth of 4.1 per cent and in 2003 growth of 6.6 per cent, the highest growth rate of the selected regions in that year. In Western Europe, final demand for all fibres was flat in 2001 and very little growth is expected in 2002 and 2003. "Consumer confidence in the region is not strong and there are any number of problems that will continue to affect some of the larger economies in the region. These include high and rising unemployment, slow economic growth, difficulties in meeting European Monetary Union targets in this slow growth environment and uncertainties regarding the financing the EU expansion," added Mr Angel.