Global Nonwovens Market Undergoing Significant Structural Changes
According to P-183 Nonwoven Materials and Products, a new report from Business Communications Co. Inc., the global market for nonwoven fabrics is estimated at 9.1 billion pounds, valued at $13.4 billion in 2004. Rising at an average annual growth rate (AAGR) of 4.8%, this market is expected to reach 11.5 billion pounds by 2009. The developed nations of North America, Western Europe and Japan currently represent nearly 60% of the total market. However, this is changing as globalization leads to greater manufacturing activity migrating to China and similar nations. These nations are also developing mass-consumer markets. Both considerations will lead to greater global demand for nonwovens.
The global nonwovens industry has undergone some significant structural changes, and has recently faced a difficult operating environment. Conditions appear to have reached a trough, and a better environment is expected to emerge, although price wars have resulted in a loss of pricing power. The poor business environment of the last several years has placed pressure on margins, forcing a number of inefficient producers into bankruptcy and leaving most of the rest operating at very low levels. Inventories are lean, however, suggesting that a pickup in demand will quickly result in a larger volume of orders. Finally, a sustained global economic recovery is now morphing into an expansion. Pricing power has begun to return, but industry consolidation will continue.