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    Russian Update

    Chinese Nonwovens Industry Aims for Massive Export Growth This Year

    Stagnant economy, lower yuan value have led producers to look outside of China for growth.

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    Eugene Gerden04.05.19
    The Chinese nonwovens industry may receive an additional impetus for further growth this year, thanks to the recently announced plans of leading local producers and the national government to create conditions for a significant increase in exports to abroad. At present, China remains the leading producer of nonwovens in the Asia-Pacific region and one of the leading in the world.

    At the same time the share of nonwovens in the Chinese overall light industry output is estimated at about 5%, both in volume and value terms. According to state plans, the planned increase of exports will require a significant increase of these figures in the years to come.

    So far, about 90% of the Chinese annual domestic nonwovens  production has been sold within the country, with only 10% being sent for exports. This prevented a rapid growth of the industry and was one of the main obstacles for its more active development.

    However, the ongoing stagnation of the Chinese national economy, caused by the recent trade wars with the U.S. and devaluation of yuan, may result in the change of the current balance in the market.

    To date, the economic decline, which has been observed in China since 2013-2014, has already led to lower demand for nonwovens and technical textiles from some major domestic consuming industries and forced producers to think about alternative sale markets.

    The situation for Chinese producers is also complicated by the fact that, so far, a significant part of local nonwovens and technical textile production has been heavily subsidized by the state, which sparked serious criticism from the U.S. and other Western states over the advantages provided to Chinese business by the national government, both at the domestic and global levels.

    However, it is expected that the end of trade wars between the U.S. and China (which is currently discussed by the sides) may result in a significant cut to further state subsidies to the Chinese sector of nonwovens and lead to the decline of profits of local producers, especially in the domestic market.

    Due to this, many of the leading Chinese nonwovens producers are considering switching at least part of their supplies to foreign markets.

    Implementation of these plans will be also part of the existing state strategy in China for the diversification of the national economy by the increase in exports of manufactured goods to foreign markets.

    In the case of nonwovens, part of the state plans is sending for exports up to 25% of their annual domestic output.

    According to plans of the producers and the national government, a particular attention this time will be paid for the increase of presence in some emerging regions, one of which is the African continent, where the presence of Chinese business, including those in the field of nonwovens and other types of technical textiles, has been significantly increased in recent years. 

    The biggest hopes are put on southeast Africa, particularly Zambia and Tanzania, which are considered not only as potential sale markets, but also potential sites for the establishment of production facilities that could be operated by the Chinese capital.

    At present, the Chinese nonwovens industry employs about 25 million people, with the Guangdong Province, (the most populous province in the country, which is located in South China Sea Coast) being a center of production.

    In the meantime, additional pressure on the industry is expected to be put by the ever tightening ecology requirements in China, which is especially relevant for its technical textile sector.

    According to data from the Chinese Ministry of Finance, at present the technical textile and nonwovens industry is one of the top five polluting industries, which regularly attracts an increased attention from local regulators.

    In this regard, leading Chinese technical textile producers are considering increasing investments in environmentally friendly production technologies, in order to avoid their closures by the state.

    In addition to exports’ growth, as part of the plans of the Chinese national government, it is creating conditions for the acceleration of R&D activities in the industry.

    Unlike other emerging nations, such as Russia, China has never had a strong scientific school in the field of nonwovens and technical textiles, while most of its developments in this field were copies of some Western products.
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