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A slightly mixed undertone in the Crude oil prices could augur well for the manmade fibre players. Polyester-cotton (PC) and poly spun yarn prices declined in the domestic market as low demand and cheap raw material forced millers and stockists to trim their rates. The US Energy Information Administration or EIA stated that the Brent crude oil spot price in our forecast averages $93 per barrel (b) in the fourth quarter of 2022 (4Q22) and $95/b in 2023. Potential petroleum supply disruptions and slower-than-expected crude oil production growth could lead to higher oil prices, while the possibility of slower-than-forecast economic growth may contribute to lower prices. OPEC+ announced a production cut of 2 million barrels per day (b/d) on October 5. OPEC crude oil production in our forecast falls from an average of 29.6 million barrels per day (b/d) in September to an average of 28.6 million b/d over 4Q22 and 1Q23.
The global Synthetic Fabric Market size is forecast to reach US$1.6 billion by 2026, after growing at a CAGR of 3.2% during 2021-2026. Globally, inorganically made man-made fabric are known as synthetic fabric which is derived from synthetic fibres. Increasing use of synthetic fibres such as polybenzimidazole fiber in its raw state, or blended form with other fibers, due to its very high decomposition temperature is anticipated to raise the market growth. Owing to the superior chemical and physical properties such as durability, elasticity, strength, and others, the demand for synthetic fabric is estimated to rise over the forecast period. Unlike natural fabrics such as cotton and silk, synthetic fabrics are water and stain-resistant, and are more economical in comparison. In addition, the increasing demand for synthetic fabrics such as polyester, spandex or lycra fabric, and cuprammonium rayon for production of elegant dresses in the textile and apparel industry, is further estimated to drive the growth of the synthetic fabric market.
The MMF industry in India has been growing rapidly. The country ranks second in the production of cellulose fiber/yarn and third in synthetic fiber production worldwide. As of date, India produces almost all types of synthetic fibers. India produces fiber, yarn, fabrics, made-ups, and home textiles. The MMF fabrics hold a majority share in the segment exports, followed by made-ups and yarn. India is completely self-dependent across the value chain, from the raw material to the garments. The industry mainly constitutes of two types – polyester and viscose- which account for ~94% (in volume terms). In this, polyester accounts for around 77.5%, and viscose has the remaining share.India exports polyester, viscose, and other types of fibers, polyester yarns, spun filaments, rope, blankets, bed linen, fishing nets, motifs, and furnishing articles. During the year 2021-22, India crossed the MMF textiles targeted exports of US$ 6.1 billion, reaching US$ 6.3 billion worth of exports. This was an increase of 36% and 7% from 2020-21 and 2019-20, respectively.
Outlook:
The overall demand trend in the textile market could be slightly tepid in coming months given the uncertain global outlook. However, a weak undertone in the Indian Rupee can keep the earnings somewhat supported in currency terms. Domestic Synthetic yarn prices are also in focus after their recent surge.
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