Needlepunched Nonwovens: Is It Time For Another Look?

By Ellen Lees Wuagneux | August 17, 2005

at long last needlepunching is being acknowledged as a sophisticated-rather than simplistic-technology set to play an essential role in the global nonwovens industry of tomorrow

Needlepunched nonwovens are continuing to make inroads in the nonwovens industry, with key markets ranging from commodity-oriented sectors such as geotextiles, automotive, flooring and furniture and bedding to specialty areas such as technical filtration. Despite recent obstacles such as overcapacity and severe competition in certain markets, the current growth rate for needlepunched nonwovens is a steady 3-5% per year according to industry sources.

Once dismissed as merely an inexpensive outlet for waste fiber, increasingly sophisticated needlepunched materials are beginning to be taken more seriously and are today recognized by many as a powerful and growing force within nonwovens. Jean Cozon, vice president, N. Schlumberger (USA), Fort Mill, SC, discussed the trend toward highly engineered needlepunched fabrics. "There has definitely been a recent increase in creativity and this is a change for the needlepunched industry, where the focus was once more commodity-oriented. For instance, we are seeing heightened interest in composites and higher-tech products featuring increased permeability and engineered performance," said Mr. Cozon. He added that this trend is driven in part by a push toward product differentiation in order to increase margins. "Everyone wants to find a niche," he said, "but there is a limited amount of profit and duration here. The trend now is to make use of two or three technologies that cannot easily be reproduced."

Anthony Centofanti, president of roll goods producer National Nonwovens, Easthampton, MA, cited a similar trend. "We have seen more demand for specialty products such as high performance fiber-based products for ballistics, toxic or hazard fluid absorption and thermal and sound insulation," he said. As a result of this trend, the company has focused its strategy this year on niche medical, aerospace and protective apparel applications. "We have made significant strides in process and technology enhancements in our needling capabilities," Mr. Centofanti said.

Needlepunched Market Overview
In terms of markets, needlepunched applications may run the durables gamut, but few market sectors have attracted as much attention as geotextiles, a veritable "buzz" area in needlepunching. Led by civil engineering end uses such as asphalt overlays and drainage materials, geotextiles are dominated by nonwovens, which currently hold about 85% of the market. Despite this level of penetration, a significant amount of growth opportunity remains within specific end use sectors, such as asphalt overlays, which has reached only about 15% of market penetration.

Once plagued by severe overcapacity and pricing pressures, the geotextile sector appears to be making a comeback according to some industry insiders. "Polypropylene needlepunched fabrics for geotextile applications is a booming industry right now," said David Ford, nonwoven product manager for Batson Yarn, U.S. representative for needlepunched machinery supplier Dr. Ernst Fehrer AG, Linz, Austria. "Demand is very strong, particularly in the U.S."

Rush Clark, vice president and general manager-industrial fabrics at roll goods producer Amoco Fabrics and Fibers Company, Atlanta, GA, agreed. "Supply and demand is in good balance currently in the geotextile market; however, we are unsure about 1999 because the industry is adding several geotextile lines and this is a real concern, particularly in the U.S." Mr. Clark added that overcapacity in the geotextile area is partially a result of misperceptions about the market. "Needlepunching is a tough business and it is not for the faint of heart. People jump in expecting an easy ride in the form of double digit growth. The false perception is that it does not take much to play; it is often assumed that specifications are easier to meet because the materials may be used underground. What you don't hear enough of is that geotextiles is actually a very technical business and it can be very challenging to make a profit," he said.

Mark Bidner, chairman, president and CEO of Western Nonwovens, Carson, CA, also characterized geotextiles as a market with slim margins. "Geotextiles had hit bottom and is only now beginning to pick up steam," he said, but added that it is an area of potential growth. "For the future," he said, "we will put forth greater efforts to increase marketshare in Western U.S. geotextile markets and plan to expand and capitalize on this area."

In the automotive sector—where needlepunched nonwovens are used as headliner and trunk materials as well as interior components such as carpeting and upholstery—strong competition continues as the industry rebounds from the recent strike at General Motors. By most accounts, although conditions have improved, the strike affected business across the production chain—from suppliers of machinery components and needles to roll goods producers—for a period of about six to eight weeks.

Henry Tio, president of needle manufacturer Groz-Beckert U.S.A., Charlotte, NC, discussed the strike and its effects. "The G.M. strike caused a definite slow-down in the U.S. market as customers were forced to build up their inventory. The strike taxed the industry, even in areas other than interior components such as filters, trunk liners, etc.," he said.

"The G.M. strike had an impact," agreed Amoco's Mr. Clark, "but it really only lasted a couple of months and this business is only part of our automotive portfolio. We also saw a pick-up in other areas during the strike," he said. Characterizing the automotive market as a "unique, development-oriented, cost-conscious business with a lot of opportunities to be creative," Mr. Rush added that the company's focus recently has been on improvements in fire retardancy as well as new applications in different parts of the car.

Offering a dissenting opinion was Klaus Maitre, executive vice president of machinery supplier Dilo, Inc., Charlotte, NC, who described the automotive market as an area of potential concern. "Automotive suppliers' efforts are currently unfocused and they are no longer certain where or what they are producing," he said. "This did not used to be the case; however, globalization has taken hold of automobile production and fewer cars are now being manufactured in the U.S. Ultimately this means a shrinking of the U.S. automotive market, which, at the end of the day, will not have a positive effect on the needlepunching industry."

John Foster, executive vice president of Foster Needle, Manitowoc, WI, had a different U.S. automotive market trend on his mind. He pointed to the area of traditional shoddy pads where, he said, there is a move away from needlepunched fabrics and toward thermal bonded nonwovens. "This is a moldability or performance issue rather than price, but it represents a considerable loss for needlepunched fabrics," he said. On the other side of the coin, Mr. Foster said that needlepunching is growing in other areas of the automotive sector, highlighting continued efforts to make inroads in automotive headliner markets.

Mathias von der Trenck, area sales manager for Groz-Beckert U.S.A., discussed an international trend in the automotive sector. "In the Far East as well as in Brazil, we are seeing a move toward finer fibers for needlepunched automotive interior components, which require finer gauge fork needles. These components, once tufted, are being replaced by lighter weight needlepunched fabrics and although this is not a new trend per se, it is an area of growing acceptance," he said.

Another important market sector for needlepunched nonwovens is filtration, an area marked by increasing technical advancement with sales activity generally on a flat curve. Despite increased activity in the area of technical filtration—particularly in the U.S. market—Dilo's Mr. Maitre described this sector as "very secretive." "Customers are busy finding new niches and innovative new products," he said, "but there is really not a lot of talk about it."

Mr. Cozon of N. Schlumberger also commented on the needlepunched filtration market. "The environmental push toward cleaner air and water has been one of the great growth drivers for our industry in the area of filtration," he said. "One issue of concern now is pressure to reverse these trends. Not only is this negative for the planet," he said, "but it has a negative effect on nonwovens."

As for markets such as furniture and bedding and home furnishings, here too needlepunched nonwovens are continuing to make strides. One such advancement, according to Kemp Harr, corporate communications manager, Synthetic Industries, Chickamauga, GA, is the evolution of needlepunched fabrics first into carpet tiles and now into carpets as alternative backing systems. "The use of needlepunched fabrics in the carpet industry is really a new marriage," said Mr. Harr. "The percentage of needlepunched materials used has been on the rise as mills begin to see nonwovens as value-added products with unique benefits."

In the furniture and bedding industry, new products are fueling growth according to Amoco's Mr. Clark. "This is an area of expansion for Amoco as well as the industry," he said, adding that the company is concentrating on finding applications that compete with traditional woven fabrics. "One new area for Amoco is decorative, more visible fabrics for furniture and bedding products," he said.

Also citing growth in home furnishings was Foster Needle's Mr. Foster. "There is tremendous growth in carpet pads," he said, "but it has largely gone unnoticed, which may be due to the fact that it is less glamorous than some other needlepunched applications that are less reliant on waste fiber," he said. Other growth drivers in the carpet padding area, according to Mr. Foster, are the trend away from foam padding in commercial buildings as well as continual carpet replacement in hotels and motels.

Bill Neely, technical service manager for Groz-Beckert U.S.A. also noted changes in the area of carpet padding. "Here we have seen an increased acceptance of shoddy over foam. Berber carpets—which generally require a non-foam padding—are becoming more popular in residential markets," he said. Mr. Neely added that another advantage of shoddy padding is that it involves the use of recycled materials. "On the commercial end, we are seeing the use of lightweight padding where no pad was used before," he said.

The Global Scope
In terms of geographic growth, roll goods producers and machinery suppliers agreed that the U.S. market is robust and enjoying positive economic conditions. That said, however, some manufacturers characterized this fiscally fertile region as a battleground between geotextile giants constantly one-upping each other in an attempt to attain a more strategically advantageous position. "Only the strong will survive," one manufacturer warned, "and we may well be looking at a totally different line-up in the future."

According to Mr. Tio, Groz-Beckert is one manufacturer gearing up for growth in the U.S. market. "We have been concentrating on the U.S. market recently in an effort to attain a position as market leader in this region. This is a growing market and we plan to take advantage of the opportunities it presents to us," he said.

N. Schlumberger's Mr. Cozon added, "In the U.S. there is a dynamism and creativity level that is very high. The export-based business will be affected by economic challenges in other regions but in general the U.S. is still an area of unchallenged growth," he said.

For its part, Europe is seen by most needlepunchers as a fairly mature market that is generally flat. However, the formation of the EU is expected to bolster the region's exporting power and many manufacturers are waiting eagerly to see the effect the new European currency will have on the global marketplace.

Latin America is less clear cut, as it is considered an area of growth by the majority of manufacturers but—according to certain suppliers pointing to a recession in Brazil—it remains an area with limited potential. Demand for needlepunched equipment from the Mexican market—an area non-existent a few years ago—is reportedly on the rise.

Moving on to the Far East, Asia—although currently plagued by economic hardship—is an area of expected long-term (5-10 year) growth. Despite the ongoing economic crisis in this region, manufacturers report that production lines are still coming onstream, for instance in China and Taiwan, and that certain markets such as high end footwear have been unaffected because of steady demand for exports.

"While there may be economic difficulties in Asia at present," said Mr. Cozon, "these consumers still expect to be able to purchase the products they have become accustomed to. It is very hard to go backwards and consequently there is still a lot of production going on in Asia," he said.

Groz-Beckert's Mr. von der Trenck commented that the company's business in Indonesia and Korea was influenced by the crisis but that China and Taiwan were unaffected. "This is primarily because there is a huge demand from this region," he said, "and companies here are still investing despite the economic trouble." For the long term, Mr. von der Trenck predicted that China will grow while other Asian areas will be stable.

Synthetic Industries' Mr. Harr added to the discussion. "The situation in Asia has had a two-fold impact, having affected both sales in Asia and in Europe. In Asia, many large-scale Chinese projects have dried up and budgets have been cut considerably. The other side is that European manufacturers—having recently added significant equipment to supply the Far East—have also been hurt and are now shifting their focus to the European market to try to absorb some of this capacity." Mr. Harr added that many European manufacturers have also lowered prices, which makes it difficult for U.S. companies to compete in the European sector.

Another key ramification of the Asian economic crisis is the potential for increased competition from Asian needlepunchers whose domestic market is failing. As a result, many of these manufacturers—particularly those dealing in price-sensitive commodity markets—are reportedly turning to Western markets such as Europe and the U.S. to compensate for excess capacities.

"There is a significant amount of nonwovens being produced in Asia," commented Mr. Foster, "and some Asian companies are experiencing such a slowdown that they are exporting to Western markets, even if this means less profitability. This is a concern for Western—and specifically U.S.—needlepunchers that are trying to compete in Western markets and the strong U.S. dollar does not help matters," he said.

Western Nonwovens' Mr. Bidner said that while it made sense to expect increased competition from Asia, his company has not yet experienced this trend first hand. "The West Coast of the U.S. would probably be the first hit but we have not yet seen this happen," he said. Mr. Bidner added that domestic producers have the advantage of quality assurance and customer service. "Needlepunching is an industry reliant on marketing and customer support," he said, "and customers prefer to get this locally."

Amoco's Mr. Clark suggested another advantage for U.S. producers. "It is cost-intensive to export these heavy products into Western markets, which will certainly affect profit margins," he said. "Another advantage is that customers cannot really depend on foreign manufacturers for a long-term relationship. They know why they are here and that if it were not for a crisis in their country, they would not be here."

Fiber Troubles To Boot
In addition to increased competition from foreign needlepunchers, another significant issue is the economic hardship currently being faced by U.S. polyester fiber suppliers. Evidence of such problems lies in the recent announcement by leading solution-dyed polyester fiber supplier Martin Color-Fi, Edgefield, SC, that sales, earnings and volumes are down, a situation the company attributes principally to severe price pressure from foreign competitors. Adding to this, due to what it calls "extremely difficult business conditions," the company failed to make loan payments, does not have sufficient liquid assets to repay its debt and is currently in the process of assessing its financial alternatives.

Another leading U.S. fiber supplier affected by the Asian economic slump is DuPont, Wilmington, DE, which will close several polyester fiber filament lines due to lower than expected earnings. The company will shut down two "Dacron" polyester filament lines in Kinston, NC and indefinitely idle filament production in Charleston, SC.

To be sure, these major shake-ups among U.S. fiber suppliers—and their potentially vast repercussions—have not gone unnoticed by needlepunchers. The question remains, however, as to how much of an effect this will have on the needlepunched sector, where both polyester and polypropylene fibers are used. Many suppliers are reluctant to consider the situation a sign of instability, pointing to the wide availability of fiber. For these manufacturers, it is more a matter of a shifting supply base—where it will come from—rather than if it will come.

"In the area of polyester," commented Western Nonwovens' Mr. Bidner, "we definitely see a struggle among domestic suppliers due to poor profitability and competition from Asian markets. This has brought on tremendous price pressure," he said. Mr. Bidner also pointed to an increased domestic supply of polyester as well as the drastically improved quality of polyester produced in Asia.

According to Dilo's Mr. Maitre, manufacturers on the polypropylene side are relatively exempt from polyester's current woes. "Polypropylene, due largely to improvements to this fiber, remains the most widely used fiber in needlepunching simply because of the size of markets such as geotextiles and automotive." According to Mr. Maitre, many large polypropylene geotextile manufacturers extrude their own fiber and are consequently less reliant on external fiber suppliers.

What Will The Future Hold?
Looking ahead, many manufacturers pointed to future growth. "Needlepunching will continue to grow and will gain more acceptance in a wider range of products," predicted Mr. Neely of Groz-Beckert. "For the long-term, we expect competition from wet processing such as hydroentanglement. For instance, in the artificial leather area, we are already seeing a trend in the Far East toward water jet equipment and we are working diligently on a response to this situation," he said.

Another manufacturer looking ahead was National Nonwovens' Mr. Centofanti. "Given their recent technological advancements, the current and future state of needlepunched products is positive and will continue to increase. Business has accelerated and this trend will continue in the next millennium. The acceptance of nonwoven technologies is displacing woven durable products at a slow but consistent rate," he said.

Consolidation was also seen as a future trend and one manufacturer voicing concern over a seemingly shrinking industry was Mr. Maitre. "Back in the early 1970's there were increased numbers of customers getting into needlepunching from traditional textiles; more recently, however, the corporate base has been shrinking." Although customers may be larger today than they once were, he explained, overall capital expenditures are down and suppliers are more respondents than initiators. "The question remains," he said, "where will we be in 2005? Instead of 250-odd needlepunch operations in the U.S., how many will there be and what will the long-term picture of the industry look like?"

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