Global textile manufacturers look forward to imminent recovery | kbnmart

In its latest publication, the International Textile Manufacturers Federation (ITMF), which conducts a regular survey of its members from around 30 producing countries, published an optimistic forecast for an upcoming recovery in global demand for textile materials, after an unusually long slowdown in activity.

“This highly contradictory scenario suggests that businesses are anticipating the end of this unprecedentedly long economic downturn,” the ITMF report said in its summer edition. The report, meanwhile, noted the current weak demand and optimistic outlook for the latter half of the fiscal year.

Meanwhile, the reality for the sector remains grim. As of July, capacity utilization had fallen to just 68% – a record low reached at the end of 2023, hit hard by a drop in European consumption caused by domestic inflation.

“The dominant concern across the textile value chain has been, and continues to be, weak demand,” the association said, adding that “66% of respondents cited weak demand as a major concern.” This issue outweighed concerns about geopolitical issues (cited by 40% of respondents) that impact supply chain decisions and consumer behavior.

Another major concern was rising costs, particularly logistics costs, which 24% of respondents said were exacerbated by higher shipping costs due to accessibility issues to the Suez and Panama Canals. Additionally, concerns persisted over energy costs (22%) and raw material prices (27%).

However, manufacturers indicated that order cancellations are no longer a major issue, nor are inventory levels, which are now at moderate levels. “The situation is different for retailers and brands, who have had to deal with unprecedented inventory levels since late 2022,” the ITMF noted. The organization expects these companies to replenish their stocks in the coming months.