Global trends in fibre prices, production and consumption

World man-made fibre production grew three times as fast in 2010 as in the previous year. In 2009 output increased by 3.9% but in 2010 it surged by 12.2% to 46.3 mn tons. Not surprisingly, the surge in 2010 was sustained by strong growth in China. Also, most of it was due to an increase in synthetic fibres-and almost all of the increase in synthetics was due to growth in polyester. That said, production of cellulosic fibres also rose, by 6.5%. Output of natural fibres increased by 13.7% in 2010 following a 6.3% fall in 2009. The increase was caused by a 14.6% rise in cotton output-following a 6.4% decline in 2009-as growers began to switch from alternative crops to cotton in response to higher prices. Indeed, the cotton price climbed throughout much of 2010 to a peak of 244 US cents/lb on March 8, 2011, and the monthly average for March 2011 as a whole was a record level of 230 US cents/lb. But the wool clip continued to decline and, as a result of these trends, the share of natural fibres in total fibre output rose only marginally, from 36.0% to 36.3%. In the 2010/11 season cotton output will rise by 11.9%, according to the International Cotton Advisory Committee (ICAC), while cotton demand is predicted to remain broadly stable-due mainly to slower global economic growth and price competition from substitute fibres. Nevertheless, the ICAC believes that demand will continue to outstrip supply and therefore the average price in the 2010/11 season will be higher than in 2009/10. However, the price attained in March 2011 is unlikely to be exceeded. According to the ICAC, the cotton price will average 162 US cents/lb in 2010/11-84 US cents/lb more than in 2009/10-but in the 2011/12 season it is likely to fall back to an average of 138 US cents/lb. Wool prices have risen sharply since mid-2010 as falls in output have brought an imbalance to the market and the stock position has tightened considerably. However, there is little prospect of a strong recovery in demand. Global demand is being sustained largely by consumption in China, as demand in the textile industries of industrialised countries is being depressed by continuing restructuring. The outlook for the rest of 2011 is for some weakening of prices, and in the 2011/12 season there will be a slight fall in stocks. But the balance between supply and demand is likely to be maintained during the season. © Textiles Intelligence Limited 2011.