According to the International Textile Manufacturers Federation (ITMF), “weakening demand” is more than ever—and by far—the main concern in the global textile value chain as of July 2022. Weakened demand hurts businesses across the value chain and in all locations. Consumer demand destruction that necessitates order cancellations is not the main problem; rather, a relatively high inventory that accumulated during 2022 needs to be corrected.
Weakening demand is the top concern for 68% of poll respondents for the upcoming six months, up from 60% in January. The participants’ next top concerns were ‘inflation,’ which was cited by 46% of them, followed by ‘high energy prices,’ which was cited by 32%, and ‘high raw material prices,’ which was cited by 30%. ‘Geopolitics’ According to the 19th ITMF Global Textile Industry Survey (GTIS), which was performed in March 2023, ‘increasing interest rates’ are now more concerning to 27% of respondents than ‘constantly rising prices.
In all regions, “weakening demand” was the top concern, while in North and Central America, “inflation” took precedence. The second biggest issue in every other location is ‘inflation’. ‘High energy prices’ and ‘high raw material prices’ continue to be a challenge for East Asian businesses. In South-East Asia, South Asia, and Africa, the same is true. Respondents who operate in Europe (including Turkey) and the Americas no longer place as much importance on these worries (i.e., high energy and raw material prices). ‘High Energy costs are still a source of some anxiety in Europe (particularly Turkey), but the focus is obviously shifting to geopolitics and increasing interest rates.
The weakening demand affects all segments, and there is concern that it won’t get better in the upcoming six months. The production of textile machinery is also affected by “inflation,” “high raw material costs,” and “geopolitics.” While spinners would rather concentrate on “inflation,” “rising interest rates,” and “geopolitics,” fibre producers are deeply concerned about “high energy prices.” ‘Inflation’ and ‘high energy prices’ are the main sources of worry for weavers/knitters and chemical fibre producers.
