Man-made fiber trends 2000

In the eighties, world textile fiber production (cotton, wool and man-made fibers)
expanded from 29.4 million tons to 38.5 million tons (excluding polyolefins), around
49% of which was the 1990 man-made fiber share, with cotton on 46% and wool on 5%.
By 1995, the man-made fiber share had already risen further to 51%, world production of
textile fibers having already reached 41.4 million tons (excluding polyolefins). A further
increase to 46-48 million tons is estimated up to the year 2000. This means an average
annual consumption - and therefore a fiber processing - increase of about 1 million tons
in the current decade, over 700,000 tons probably falling to the lot of synthetic fibers,
with only about 250,000 tons to cotton (with wide variations) (cf. also statistics). An
estimate made by Werner, the Brussels textile business consultants, a company which has
always been quite close to reality in its estimates in the past in this respect, indicates the
following expected increase in consumption for the nineties: to 41.6 million tons for
textile fiber consumption in 1995, and 46.2 million tons in the year 2000.

The increased world population forms an important basis for the increasing textile
consumption throughout the world. It is estimated that the world population will increase
from 5.3 to more than 6 billion between 1990 and 2000, of which almost two thirds will
be living in Asia at the turn of the century. Further growth in consumption must therefore
lie predominantly outside the former industrialized regions.

Further increases in textile fiber consumption will be borne preponderantly by the

synthetic fibers (predominantly polyester fibers, but PP fibers too), while cellulosic man-
made fibers will stagnate at best from the world standpoint (with reshuffling within the
cellulosics of course).

World synthetic fiber production (including polyolefins) was almost 16 million tons in
1990. Estimates for the year 2000 are already more than 25 million tons. In the eighties,
world synthetic fiber production expanded from 11 to 16 million tons, i.e. by about 5
million tons; the total capacity increase for the nineties should therefore be of the order of
size of almost 10 million tons.

Substantial structural changes

Development within synthetics was of course highly varied in the eighties. High growth
rates in polyester and polypropylene fibers contrasted with small increases or slight
decreases in the case of polyamide and acrylic fibers. The weighting within the synthetics
has consequently changed; this trend is also being maintained in the nineties.

Polyester at the top

On a world basis, since 1972, polyester has been the most important synthetic fiber.
Today, the fiber, invented in England over 50 years ago (1941), is being produced in
more than 540 plants throughout the world in an order of size of 12 million tons,
estimated at a value exceeding 60 billion DM. World installed capacity might already be
18 million tons/year at the end of 1997. An increase in polyester fiber production to 16-
17 million tons is expected by the year 2000. Japanese estimates are somewhat lower of
course.

Of the 1996 world polyester production, 45% was in staple fibers, 50% in textile filament
yarns (including textured yarns) and 5% in technical filament yarns. Current growth
supporters/bearers are microfibers (Japan, Western Europe, India and the USA too), high
tenacity yarns for technical application fields, staple fibers for nonwovens and blended
yarns (particularly with cotton or viscose in developing countries). The focal points of
production have already relocated during the eighties from the industrialized to the
developing countries. Whilst in 1980, only 38% of world production was located in those
regions, it had already risen to 64% by 1990, and even to 72% by 1995. In absolute
figures, this becomes even clearer: in this period, PET production in the developing
countries expanded from 1.9 to 8.7 million tons, and has therefore grown almost five-
fold.

This trend will continue on an increasing scale over the next few years on account of
current engineering company projects (particularly in the Far East). 5 of the 10 largest
polyester fiber producers already come from the Far East (only 1 of them in Japan!). By
far the world's biggest polyester fiber producer is currently Hoechst Trevira with a
capacity throughout the world of more than 1 million tons/year (even almost 1.4 million
tons/year in total for polyester polymers).

Polyamides: only slight expansion

In contrast, polyamide fiber expansion in the eighties and nineties was considerably
weaker. 3.9 million tons of polyamide fibers were produced throughout the world in more
than 290 plants in 1995, of which 55% might have been PA 6 and 45% PA 66 (only a few
large groups!). In contrast to polyester, the share of PA staple fibers was only 16% (84%
filament yarns including BCF yarns). 64% of staple fiber production fell to the share of
the USA alone (with its strong carpet industry).

PA world capacity was already 5.7 million tons at the end of 1997, and might see
scarcely any growth to the turn of the century. Production will certainly be considerably
below 5 million tons (1995: 3.9 million tons).

Acrylic fiber stagnation

In recent years, acrylic fibers have been the problem product within the synthetic fiber
range. From a world capacity of 3 million tons/year, only 2.3 million tons were produced
in 1990 (i.e. only 75% capacity utilisation). In 1995 too, world production reached only
2.4 million tons (with a 3.3 million tonne capacity), and capacity utilisation consequently
fell to 72%. Whilst in the USA, Japan and also in Western Europe capacity was reduced
(DuPont dropped out!), new capacity is currently being installed only in China, India,
Mexico, Indonesia, Turkey and Iran. Only China (1995 consumption: 430,000 tons; home
production only 230,000 tons) remains a large net importer in this respect.
PP fibers: vigorous expansion

In contrast, polypropylene fibers exhibited high growth rates in the eighties and nineties
(over 98% of current polyolefin fiber production is polypropylene; polyethylene fibers,
including bicomponent fibers, are currently of little market importance from the quantity
standpoint). World production for 1990 has already been estimated at over 1.3 million
tons (reliable statistics are frequently lacking), of which 700,000 tons are staple fibers,
400,000 tons filament yarns (including BCF yarns) and 200,000 tons spunbonded fabric.
In addition, a further 1.3 million tons of split-film yarn should be added as a speciality
(about 20% polyethylene-based here in fact) including monofils. The estimated total
world production of textile polyolefins for 1990 was over 2.6 million tons.

The vigorous expansion in PP fibers is continuing in the nineties, and the market research
company SRI in Zürich consequently expects annual growth rates of 9% in Western
Europe up to the mid-nineties. World PP fiber production will already have exceeded 4
million tons by the year 2000; including split-film yarns (with only small growth rates of
course), world polyolefin textile production might exceed the order of size of 6 million
tons (at any rate, the current level of world PA and PAN production together!), and with
the special, well known limits of these fibers (in practice to date hardly dyeable except by
spun-dyeing, low melt point, no moisture absorption). The most important fields of
application are therefore also technical textiles and domestic textiles/floorcoverings, and
only to a quite limited extent clothing textiles (sports and leisure wear). PP fiber
producers are currently expanding the speciality range in particular (high tenacity yarns,
nonwoven types and microfibers).

With annual growth rates of 8%, elastane yarns are currently expanding on a world basis,
and consequently world production will already have exceeded 100,000 tons by the year
2000.

More high-tech fibers

So-called high-tech fibers are also continuing to gain greatly in importance for processing
into technical textiles, although the quantities are still infinitesimal in comparison with
standard fibers. The most important groups here are the aramids (high tenacity p-aramid
fibers, flame retardant m-aramids) and carbon fibers. The world production of p-aramid
fibers currently exceeds 30,000 tons, and might rise to 40-50,000 tons by the year 2000
(m-aramids 15,000 tons/year). The world production of carbon fibers may currently be
estimated at 10,000 tons, and goes predominantly into composite materials. In this
market, somewhat overestimated by many firms, there should in any event still be plenty
of movement in the coming years.

Summarizing the trend in synthetic fibers: continuing growth markets (also through new
products like microfibers for example), but with greater relocation of production to the
Far East.

Cellulosics in stagnation
In contrast, the world production of cellulosic man-made fibers (viscose, modal, lyocell,
acetate and cupro) will at best be stagnant on the whole in the nineties.

Considerable environmental problems (and therefore additional production costs)

counteract the advantage of cultivated raw materials, and no new plants have therefore
been built in Western Europe despite the world viscose boom at the beginning of the
nineties. The available plants were just used to the maximum (which however also meant
to some extent reduced tonnages with the market requirement for finer counts in both the
filament and staple fiber fields).

In Eastern Europe there was significant capacity reduction, despite which capacity is
currently only half-utilized in any case. In contrast, new plants are planned in the Far East
(example: Indonesia; no cotton, but sufficient wood). As the world's largest viscose
producer, Lenzing doubled its capacity at the beginning of 1992 to 70,000 tons/year,
expanding that to 105,000 tons/year by 1997.

In 1990, over 120 viscose fiber plants throughout the world (total capacity 3.2 million
tons/year) and 27 acetate plants (250,000 tons/year) produced a total of 2.85 million tons
(excluding acetate cigarette filter tow). In 1995, world production of cellulosic man-made
fibers still reached only 2.5 million tons. In this respect, the biggest viscose fiber
producer is the (former) USSR with a capacity of over 600,000 tons/year. On the other
hand, plants were laid up in the USA.

New processing techniques for cellulosic man-made fibers, which eliminate current
environmental problems with viscose exhaust air (i.e sulphur-containing compounds) by
using solvents in the circulation, are only in the initial stages, and consequently the new
fiber family lyocell has achieved a quantity importance worth mentioning only since the
mid-nineties. Courtaulds started production in the USA in 1993 (capacity 18,000
tons/year) on the basis of their own fiber development in England (Tencel fibers), and has
now expanded it to 55,000 tons/year. Production begins in England in 1998 with a 42,000
tons/year plant. Lenzing has available so far a pilot plant for staple fibers based on Enka
patents, and is to start fiber production (15,000 tons/year) in mid-1997 (capacity will then
be doubled). Akzo is working on the development of lyocell filament yarns (now in
conjunction with Courtaulds and Asahi Chemical/Japan). The Thuringian Textile and
Plastics Research Institute (TITK), Rudolstadt, has available a pilot plant in accordance
with its own patents (Alceru). In the year 2000, the world's available lyocell capacity will
therefore be well over 120,000 tons/year.

Already 300,000 t of lyocell in 2005?

In the spring of 1998 Courtaulds Plc, London put into operation a plant for lyocell staple
fibers (Tencel) in Grimsby, England with a capacity of 42,000 t/year (investment £ 120
million). As early as 1987 Courtaulds installed a pilot plant for lyocell fibers in Grimsby
based on Akzo licences. The first production plant (18,000 t/year) went into operation in
the USA in December 1992 (investment US $ 90 million). In February of 1996 a second
plant (investment US $ 140 million) took up production of Tencel fibers. In the not too
distant future these two plants will be equipped with a new technology, their total
capacity being increased to 55,000 t/year by 1999. Thus Courtaulds will have available a
total capacity of 100,000 t/year of lyocell staple fibers in 1999.

As early as mid 1997 the Lenzing daugther company Lenzing Lyocell GmbH,
Heiligenkreuz, Austria, put the first European pilot plant for lyocell fibers (trademark
Lenzing Lyocell) into operation. The initial capacity of 12,000 t/year will be extended to
15,000 t/year. The construction of a second production line is to begin in mid August of
1998 so that already mid 1999 about 40,000 t/year will be available in Heiligenkreuz
based on latest technology. Both production lines require investments of a total of ATS
2.1 billion. A third line is already provided for the year 2000 amounting to ATS 500-600
million. For the year 2004 or 2005 taking-up on production in a second lyocell plant in
Europe or Asia is being discussed.

Courtaulds is planning a further lyocell plant in Asia and the construction of a joint plant
with Akzo Nobel for lyocell filament yarns (NewCell) is being discussed.

It is expected that a total capacity of at least 300,000 t/year will be available within the
next 7 to 8 years worldwide (for comparison: world production of silk amounts to
100,000 t/year), further fiber producers will certainly enter into the market: the German
engineering company Zimmer AG, Frankfurt will put into operation in 1998 together
with TITK research institute a pilot plant in Rudolstadt.

Lyocell fibers produced after the solvent-spun process are extraordinarly wear-resistant,
machine washable, and are distinguished by low shrinkage properties. Added to this are
properties typical of cellulosic fibers such as soft drape, silky handle, slight lustre, color
brightness, good moisture abosrpiton. Moreover, lyocell fibers are biologically
degradable. Furthermore Lenzing Lyocell is worldwide the first lyocell fiber which is
completely free of chlorine.

Courtaulds' and Lenzing's patent lawsuit of many years having been settled at the
beginning of 1998 both companies are forming a know-how pool. Both parties have
signed an agreement granting each other licences for their lyocell patents. This enables
both companies to produce and sell worldwide and without restrictions lyocell staple
fibers. Both companies hold approx. 60 patents each concerning lyocell processes.

Textile mills with their own fiber production?

The world-wide tendency for textile mills to set up their own synthetic fiber production
grew in the eighties. Overseas, fully vertically organised firms - fiber production through
to textile finishing (sometimes making-up too) - are in any case more frequently
encountered, and are almost standard in Japan. In Western Europe too there is increasing
interest in in-house fiber production, supported by textile engineering with its compact
equipment. Up to now, this trend has been concentrated on floorcovering and nonwoven
producers with their own PP equipment. In the meantime, investment in PET and PA
plant has been extended. Growing recycling discussion in Western Europe and the USA
could also foster this trend, at least in the case of PP fibers, the waste being directly
reprocessed into fibers (or fibers produced from PET bottles).

The number of fiber producers is therefore continuing to grow in the nineties too. In
1996, some 2000 man-made fiber plants were installed throughout the world (including
PP fibers). For standard fibers, large plants will predominate for reasons of cost, while
small plants are also competitive for special types, quite irrespective of supply quantities
and delivery dates. During the nineties too therefore, synthetic fibers, with increasing
production quantities, are regarded as included among the world's growth sectors.

Man-made fiber
The toxic alternatives to natural fibers.

Shan Clark

The late 1920s and 1930s saw continuing consolidation of power into the hands of a few large steel,
oil, and chemical (munitions) companies. The U.S. federal government placed much of the textile
production for the domestic economy in the hands of their chief munitions maker, DuPont.

The processing of nitrating cellulose into explosives is very similar to the process for nitrating
cellulose into synthetic fibers and plastics. Rayon, the first synthetic fiber, is simply stabilized
guncotton, or nitrated cloth, the basic explosive of the 19th century. [This is incorrect. Correction]

“Synthetic plastics find application in fabricating a wide variety of articles, many of which in the past
were made from natural products,” beamed Lammot DuPont (Popular Mechanics, June 1939, pg.
805).

“Consider our natural resources,” the president of DuPont continued, “The chemist has aided in
conserving natural resources by developing synthetic products to supplement or wholly replace
natural products.”

DuPont’s scientists were the world’s leading researchers into the processes of nitrating cellulose and
were in fact the largest processor of cellulose in the nation in this era.

The February, 1938, Popular Mechanics article stated “Thousands of tons of hemp hurds are used
every year by one large powder company for the manufacture of dynamite and TNT.” History shows
that DuPont had largely cornered the market in explosives by buying up and consolidating the
smaller blasting companies in the late 1800s. By 1902 they controlled about two-thirds of industry
output.

They were the largest powder company, supplying 40% of the munitions for the allies in W.W.I. As
cellulose and fiber researchers, DuPont’s chemists knew hemp’s true value better than anyone else.
The value of hemp goes far beyond line fibers; although recognized for linen, canvas, netting, and
cordage, these long fibers are only 20% of the hemp-stalks’ weight. 80% of the hemp is in the 77%
cellulose hurd, and this was the most abundant, cleanest resource of cellulose (fiber) for paper,
plastics, and even rayon.

The empirical evidence in this book shows that the federal government - through the 1937
Marijuana Tax Act - allowed this munitions maker to supply synthetic fibers for the domestic
economy without competition. The proof of a successful conspiracy among these corporate and
governing interests is simply this: In 1991 DuPont was still the largest producer of man-made
fibers, while no citizen has legally harvested a single acre of textile grade hemp in more than 50
years.
An almost unlimited tonnage of natural fiber and cellulose would have become available to the
American farmer in 1937, the year DuPont patented nylon and the polluting wood-pulp paper sulfide
process. All of hemp’s potential value was lost.

Simple plastics of the early 1900s were made of nitrated cellulose, directly related to DuPont’s
munitions-making processes. Celluloid, acetate, and rayon were the simple plastics of that era, and
hemp was well known to cellulose researchers as the premier resource for this new industry to use.
Worldwide, the raw material of simple plastics, rayon, and paper could be best supplied by hemp
hurds.

Nylon fibers were developed between 1926-1936 by the noted Harvard chemist Wallace Carothers,
working from German patents. These polyamides are long fibers based on observed natural
products. Carothers, supplied with an open-ended research grant from DuPont, made a
comprehensive study of natural cellulose fibers. He duplicated natural fibers in his labs and
polyamides - long fibers of a specific chemical process - were developed.

Coal tar and petroleum based chemicals were employed, and different devices, spinnerets, and
processes were patented. This new type of textile, nylon, was to be controlled from the raw material
stage, as coal, to the completed product; a patented chemical product. The chemical company
centralized the production and profits of the new ‘miracle’ fiber.

The introduction of nylon, the introduction of high-volume machinery to separate hemp’s long fiber
from the cellulose hurd, and the outlawing of hemp as ‘marijuana’ all occurred simultaneously.

The new man-made fibers (MMFs) can best be described as war material. The fiber making process
has become one based on big factories, smokestacks, coolants, and hazardous materials, rather
than one of stripping out the abundant, naturally available fibers.

Coming form a history of making explosives and munitions, the old ‘chemical dye plants’ now
produce hosiery, mock linens, mock canvas, latex paint, and synthetic carpets. Their polluting
factories make imitation leather, upholstery, and wood surfaces, while an important part of the
natural cycle stands outlawed.

The standard fiber of world history, America’s traditional crop, hemp, could provide our textiles,
paper, and be the premier source for cellulose. The war industries - DuPont, Allied Chemical,
Monsanto, etc. - are protected from competition by the marijuana laws. They make war on the
natural cycle and the common farmer

Alliance to reverse man-made fiber trend

Feb 20, 2002 12:00 PM
By Forrest Laws Farm Press Editorial Staff

By now, most consumers

in the United States
know that cotton is the
fiber of choice when it
comes to clothing or
towels or bed linens.
That, unfortunately, is
not the case in much of
the rest of the world.

“Other countries are not

promoting cotton
consumption, even the other largest world producers such as China, India, Pakistan, Uzbekistan or
Australia,” said Allen Terhaar, executive director of Cotton Council International, speaking at a press
briefing at the Beltwide Cotton Conferences in Atlanta.

“The U.S. cotton industry is the only one doing consumer promotion on any significant scale — here
in North America using the Cotton Incorporated Seal of Cotton and elsewhere using the COTTON
USA trademark.”

“What's happening in other countries reflects what could have happened in the United States if
farmers had not funded their own marketing and research program, said Dean Turner, senior vice
president in charge of global marketing and technical services at Cotton Incorporated.

“Those of you old enough may remember that when we were formed 30 years ago, cotton's market
share at retail seemed destined to drop precipitously to around 20 percent in the early 1990s,” said
Turner. “Cotton was history…a fiber of the past.”

As most producers know, Cotton Incorporated has worked hard to reverse that trend so that cotton
consumption levels are back above the 60 percent level in the United States and Mexico today.

Outside North America, however, promotion efforts for cotton have been limited with man-made
fiber dominating much of the overall strong growth in fiber use. As a result, cotton consumption is
declining overseas and world cotton prices have fallen to the lowest levels in 20 years.

“The key reason that cotton is losing the battle against man-made fibers internationally appears to
be the decline in cotton consumption in favor of synthetics in some of the world's most populous
countries, including those like India and China that are among the world's largest cotton producers,”
said Terhaar.

“In those countries, cotton has not only lost market share to man-mades, it has also lost overall per
capita consumption. If this trend continues, cotton consumption in India, for example, will be half
what it is today by 2020.”

To combat such losses, Cotton Council International is working to develop a formula to stimulate
demand in densely populated countries, particularly those with domestic cotton fiber production.

As part of that effort, Cotton Council International applied for and was granted $2 million in USDA
Section 108 funding over the next three years to try innovative approaches to increase foreign
consumption.

“Our intent is to pick one or two countries within the Indian subcontinent and South America to
focus our activities to determine the success of this approach and determine how and whether this
program can be expanded after two or three years of success,” Terhaar said.

The program will be called the Cotton Gold Alliance, a reference to the partnership between Cotton
Council International and Cotton Incorporated that will build on the organization's experience in
promoting U.S. cotton.

“The Alliance also refers to the close working relationship that we intend to develop with the leaders
of the local cotton value chain,” he said. “We intend to enlist their collaboration and active financial
involvement in promoting their products in local markets.”

Given the challenge of man-made fibers, “we cannot afford to have developing countries moving
wholesale from natural fibers to synthetics,” Terhaar noted. “We need to devise effective strategies
to bring those consumers, particularly those in the middle class, back to cotton.”

February 2004 - Volume 19 / Number 1

Polyester Consumption To Top 33.6
Million Tons By 2010, PCI Predicts
By Alasdair Carmichael - PCI Fibres & Raw Materials

The polyester fiber producing industry has seen continuous growth since its
commercial beginnings in 1953 with the DuPont plant in Kinston, North Carolina.
Total world mill consumption of filament and staple fiber in 1980 reached 5.2 million
tons. Steady global growth brought mill consumption to 8.67 million tons by 1990,
and the ratio of staple to filament was 54:46.

China’s role in the global polyester fiber market was the defining factor of the 1990s
and will continue through the first decade of 2000. Global mill consumption reached
19.1 million tons by 2000, with China accounting for 31% of the total.

An interesting shift that took place during this period was the change in the balance
between staple and filament. While staple had a leading share in 1990, filament
accounted for 57% compared to staple’s 43% share only 10 years later — a
remarkable shift over such a short period. (See chart 1.)

The filament share growth has been driven by a broad cross section of markets.

Japan, Taiwan and Korea started the move in the 1980s and, as Chinese capacities
went through dynamic growth, their preference for filament was apparent. Mill
consumption in China is 58% filament, and in Korea and Taiwan the share of
filament climbed to 82%. Changes in consumption patterns in Western Europe have
also seen filament grow against staple, as more industrial end uses are developed.
PCI sees continuing growth in consumption of polyester fibers and is forecasting that
by 2010 the total will reach 33.6 million tons with filament share at 59%.

Major Polyester Producers

As the industry has grown so rapidly it is no surprise that the major producers within
the industry have changed. Asian companies rapidly replaced the initial dominance of
Western companies in polyester capacity. The 1980s saw major increases in the
capacities of Japanese, Taiwanese and South Korean polyester companies. By the
end of the 1990s, the larger Chinese companies were taking their place in the
rankings of major producers.

The PCI 2003 World Synthetic Fibres Report lists capacities of all polyester fiber
plants globally and from this we are able to tabulate the top 10 producers. Where
capacity is in a joint venture, the capacity allocation is made by the known, or
estimated, share of the joint venture. There are cases where company relationships
are not always clear, so if in doubt we have tended not to accumulate capacities
where joint ownership is unclear.

A list was published in Japan in 1980 indicating the top 10 polyester fiber producers.
The only Japanese company appearing on both the 1980 and 2003 lists is Teijin. The
change in the make-up of major producers is highlighted by the fact that of the 10
companies listed in 1980, only 4 of them are still active in the polyester industry,
and the leader at that time, DuPont, is about to exit the business in 2004. But who
might be the biggest polyester fiber producers in 2010?

Taking capacity for filament and staple together for all their various plants and joint
ventures across the world, PCI is forecasting the largest polyester fiber producers in
2010 to be Shaoxing Yuandong, Yizheng, Reliance, Nan Ya, Far Eastern Textile,
Zhejiang Rongsheng, Indorama & Assoc., Huvis, Sanfangxiang Group, Teijin.

Thus, of the top 10 in 2003, only 7 are expected to remain in this group for 2010.
Companies solely based in China will take four of the top 10 positions in 2010, and
all the companies on the list will be based in Asia. There may be some consolidation
of plants in China during the period, and it may be that even larger conglomerates
emerge, but we expect the country emphasis in the listing will not be significantly
changed.

It is worth noting that if the Koch acquisition of Invista is completed, the new joint
polyester capacities would move to 4th in the overall top 10 list. The joint capacities
of polyester, nylon and spandex would make the company the largest synthetic fiber
producer in the world.

Details of the PCI World Synthetic Fibres Report are available at

www.thepcigroup.com/fibres or by email to fibres@thepcigroup.com

The Man-Made Fibers Market

The textile system is interconnected to other realities whose evolution conditions
their development. Particularly, the production of textile fiber world is of big
strategic importance.
The analysis of the quantitative and qualitative evolution in the world of fiber
production in very important in order to give the textile world information about its
possible development.
As instance, the innovation in the textile system is highly conditioned by the
innovation concerning raw materials, even if large quantities and large productions
always refer to standard, basic fibers.
Natural fibers play a role that is important still today. Cotton and polyester are on top
of used fibers, whereas other natural fibers occupy a marginal place that probably
won’t be modified in a short and medium time.
Besides, natural fibers, beyond what genetic engineering can maybe furnish in a
short future, are very much bound to a territorial area and we can’t interfere on their
characteristics and performances.
If we move from basic materials everywhere disposable, chemical fibers better fit for
that wide redistribution that the textile industry has undergone and will undergo.

Beside this wide availability, chemical fibers seem to have an innovative potential
that is bound to the research and development of new products.

Today’s chemical fibers, even the most common ones, have surely better
characteristics and performances than those of the ones of twenty years ago.
Let’s think, to make it simple, of the birth of new kinds of polyester beside the
traditional ones, of the development of micro fibers and of more technical fibers that
were unthinkable only a few years ago.

Acordis and USA Association data

According to Acordis, the situation of chemical fibers shows today what follows:

• Trends of past years continue

• World fibre consumption continues to grow
• Man-made fibres already account for 60% of world-wide fibre consumption
• Highest growth rates for man-made textile fibres in Asia
• Europe, Japan and USA
• Stable development of man-made industrial fibres
• Further growth in specialities
• Further decline in mass-produced textile goods
• Overall growth in world-wide production of man-made fibres will continue

The Man-made Fibres Industry Wider European

Trading Area 1999*
Item Unit Value
Turnover EUR 12.5 bn
Quantity produced tonnellat 4.6 m
Produzione in e
volume
Investment EUR 520 m
Costs in R&S EUR 300 m

Note:EU (15) + Switzerland, Malta, Turkey, Poland, Czech Republic, Slovakia,

Hungary, Slovenia, Romania, Bulgaria and Baltic States.
Other parts of the former Soviet Union and ex-Yugoslavia are excluded.

World chemical fiber production outside industrialized

Countries
(million tons) 1995 1996 1997 1998 1999
China 3.2 3.4 4.3 5.2 6.0
Taiwan 2.6 2.7 3.1 3.3 3.1
South Korea 1.9 2.1 2.5 2.5 2.6
India 1.0 1.2 1.5 1.6 1.7
Indonesia 0.9 1.0 1.1 1.1 1.4
Latin 1.1 1.2 1.2 1.2 1.3
America
Eastern 1.1 0.9 0.9 0.8 0.7
 Europe
Others "RoW" 2.1 2.4 2.8 2.7 3.1
Total "RoW" 13.9 14.9 17.4 18.4 19.9

1999 particularly showed:

• Downturn in textile-cycle reinforced by

o Asian crisis combined with excess capacities there
o Import restrictions on China
o Western Europe, e.g. from Turkey
o Strong increase in low-priced fibre imports
o Retailing business remains weak in important textile countries
• Collapse in sales for all European manufacturers of man-made textile fibres

To better the analysis of the today’s situation of chemical fiber production, data of
Fiber Economic Bureau (2000 world directory of manufactured fiber producers) can
be used, even if they are relative to 1998 because they analyze the evolution in
1978-1998.
The overall fiber production has reached 29,9 millions of tons, increasing of 108%,
from 14,3 millions of tons in 1978.
The growth is bound to synthetic fibers, which are today 93% of the whole, because
cellulose fibers are declining.

With its 16 millions of tons, polyester is the most important (53,5% of the whole),
oilefinic fibers are the second on the row (16,4%) then nylon (13%) and acrylic ( 9%).
Oilefinic ones have had the most significant performances (from 7% in 1978).

Production moves more and more to Asia (56%), whereas the strongest decline has
struck Northern America, from 61% in 1968 to 37% in 1998.

Synthetic fibers have grown 5% each year, cellulose ones have reduced 2% each
year.

Oilefinic fibers have growth rates of 8%, polyester of 6%

Despite woes, cotton making world gains

Feb 17, 2001 12:00 PM
Hembree Brandon

As if low prices, high production costs, and a flood of textile imports weren't problems enough for
the U.S. cotton industry the past three years, it also has had a tooth-and-nail battle with synthetics.
"Man-made fiber is
challenging cotton in
every market," Kent
Lanclos, assistant
director of economic
services for the National
Cotton Council, said at
the organization's annual
meeting at San Diego, Calif.

"World retail consumption of cotton last year (2000) is estimated at 90 million bales, while polyester
use is estimated at 86 million bales. All man-made fiber use has soared to the equivalent of 145
million bales."

While cotton use is rebounding from its 1998 decline, Lanclos said, polyester saw a steady increase
during that period of market turmoil and analysts are now projecting that 2001 will see polyester
use outstrip that of cotton.

Still, cotton is making gains on the world scene.

Starting with an 8 percent increase in world consumption in 1999 over 1998, the USDA is now
projecting that 2000 use will be up another 300,000 bales to 92.2 million.

"The quick rebound in world cotton mill use is a testimony to the rapid recovery of the Asian
economies following the 1998 financial crisis," Lanclos says.

In the world today, three countries - China, India, and Pakistan - accounted for nearly 44 million
bales of mill use in 2000, or about 48 percent of the world total. More impressively, they represent
over 75 percent of the increase in world mill use since 1998.

"If foreign governments continue to invest in their textile industries, and the price of cotton remains
competitive with man-made fibers, cotton mill use should increase slightly to 93 million bales in
2001," Lanclos says.

Export projection The USDA is now estimating that raw cotton exports last year will hit 26.7 million
bales, about 29 percent of world mill use.

This rebound in U.S. exports, Lanclos says, can be traced back to the government's restored
funding in Oct., 1999 for the Step 2 payments program.

"The availability of Step 2 certificates has permitted U.S. merchants to quote competitively priced
cotton, while domestic prices remain above world prices. The USDA is now estimating U.S. exports
of raw cotton in 2000 will total 7.3 million bales.

But, Lanclos notes, "Even though conditions have improved from last year, the world cotton market
remains intensely competitive."

The lineup of key world cotton buying nations is changing, he says. "Ten years ago, the top three
export destinations for U.S. raw cotton were Japan, China, and South Korea. In 1999, they were
Mexico, Turkey, and Indonesia, and year-to-date figures show that to be the case for 2000. Further,
China is no longer even in the top 10."

Even so, China remains a major influence on the direction of the world cotton market, Lanclos says.

"For the past two years, China has been a net exporter of cotton, trying to reduce burdensome
stocks levels. At the same time, their consumption seems to be rising at an extraordinarily steep
rate."
With the USDA forecasting China's mill use at 23 million bales for 2000, and production at 20 million
bales, many analysts are forecasting that China is at a zero net trade position.

Importer once again "For 2001, China is expected to once again become a net importer of cotton,"
Lanclos says. "And with the exception of the dissolution of the former Soviet Union and Central
Asian bartering, changes in China's net trade position have been a greater impact on average cotton
prices over the past two decades than any other factor."

While China's cotton stocks numbers (it held over 47 percent of the world's total cotton stocks in
1998) are a major concern to the industry, he says indications are their government is making
progress toward resolving production/use imbalance.

"Chinese authorities finally have begun reform of their cotton policies, which seem to be working,
since stocks have been reduced by over 9 million bales in just two years."

Reducing China's production has proven "a more intractable problem," Lanclos says. "Cotton
continues to be the most profitable crop for Chinese farmers, who currently are getting about 68
cents per pound, up from 54 cents last year. These higher returns will encourage them to maintain
cotton acreage, resulting in at least the same size crop for 2001."

Based on National Cotton Council forecasts of production mill use, Lanclos says the foreign cotton
production deficit for 2001 is projected at 11.7 million bales.

Cover deficit "This deficit will have to be covered by some combination of U.S. exports and further
drawdown of world stocks. With Step 2 in place, U.S. raw cotton exports should increase to the
range of 8 million to 8.5 million bales, for a market share of more than 28 percent."

More than 1,000 representatives from the cotton industry's seven segments participated in the
annual meeting.

Delegates from 17 cotton-producing states developed and adopted resolutions for council action in
farm and economic policy, international trade, public relations and international market
development, research, education, packaging, distribution, and health/safety/environment.
Cotton Board budgets to fight man-made fibers
Sep 21, 2001 12:00 PM

By Brad Robb

Despite U.S. mill

closings, industry
corporate consolidations,
and employee cutbacks,
Cotton Incorporated's
board and Cotton Board
members and
alternatives say they
remain united in their
determination to keep
pressure on the deep-
pocketed, man-made
fiber conglomerates.

At the Cotton Board's annual meeting in Atlanta, a $63 million budget was approved for Cotton
Incorporated's for 2002.

This emphasizes “the vital importance of maintaining an aggressive effort to preserve gains made
through the years by our research and promotion program,” said Seymour Johnson, board chairman
and Indianola, Miss. producer.

“If we were to decrease Cotton Incorporated's funding, we could very realistically start eroding the
valuable progress that has been made since the program was created in the early 1970s.”

Further evidence of that commitment was shown, said Bob McGinnis, Ag Committee chairman and
Arkansas producer, in the approval of the most aggressive agricultural research program to date —
almost $8 million.

During the board's general session, Kenneth Hood, National Cotton Council vice chairman and
Gunnison, Miss. producer, updated attendees on the latest developments from the Memphis-based
organization, including action on new farm bill legislation.

Keith Collins, USDA chief economist, said despite “an overly depressed market, a great deal of
gratitude is due Cotton Incorporated's aggressive research and promotion activities that have
increased per capita consumer consumption from 10 pounds of cotton per person in 1980 to its
current level of 35 pounds.”

J. Berrye Worsham, president and chief executive officer of Cotton Incorporated, announced that
Roy Cantrell, formerly with New Mexico State University, has been hired to lead the organizations
research division, replacing William Lalor, who recently retired after 28 years of service.
Officers for 2002 elected at the board meeting were John E. Pucheu, Jr., Tranquility, Calif.,
chairman of the board; Kent D. Nix, Lamesa, Texas, vice chairman; Nancy Ann Marino, Upper
Brooksville, N.Y., secretary; V. Larkin Martin, Courtland, Ala., treasurer; and Mike Sturdivant, Jr.,
Itta Bena, Miss., assistant treasurer.

The Memphis-based Cotton Board is the collection and fiduciary arm of the Cotton Research and
Promotion Program.