Synthetic Fibers Procurement Intelligence Report, 2023 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)

Synthetic Fibers Category Overview

The global synthetic fibers category is anticipated to grow at a CAGR of 7.4% from 2023 to 2030. The majority of the global textile market is made up of synthetic fibers because of their affordability and functional qualities. In 2023, owing to its performance advantage over natural textiles, synthetic fibers currently account for more than 60% of all fiber usage globally. In contrast to materials like cotton, silk, or wool that are derived directly from plants or animals, synthetics are made wholly of chemicals. The most popular kinds are petroleum-based and include nylon, polyester, rayon, acrylic, and spandex. By material type, polyester is the most popular one and dominates the category accounting for 48 - 52% of the total fiber production in 2023.

With an increasing focus on sustainability, one of the major trends has been the use of sustainable colorant solutions and functional additives (for chemicals, dyes, spin-dyeing, and finishes) for coloring and modification of the category in focus. The rising demand for synthetic fibers over natural fibers can be primarily attributed to their wide availability, and cost-effective prices, along with a wider range of applications across industries. Furthermore, the increasing demand for the product in many consumer goods, accessories, and apparel is driving the growth of the category.

One of the major drawbacks of synthetic fibers is that most of them are not biodegradable. As a result, these fibers contribute to landfill waste and plastic pollution. Some of the fibers release microplastics when washed. However, the manufacture of synthetic fibers is becoming more sustainable thanks to technological developments. Recycled and biobased synthetic fibers provide a viable substitute for traditional synthetic materials obtained from fossil fuels. University of California research studies in 2023 have found that synthetic textiles (made of compostable materials) including polylactic acid, and synthetic fibers in blended textiles did not show evidence of deterioration after a year, whereas natural and wood-based cellulose fabrics deteriorated within a month.

One of the latest innovations, as of September 2023, is the creation of “spider silk” fibers in China. Researchers in the country have developed this eco-friendly synthetic substitute which is six times more durable than the Kevlar used in bulletproof vests. The silk is produced using genetically modified (transgenic) silkworms. The method can be applied to develop a commercial synthetic fiber that is less harmful than nylon. According to the researchers, this innovation needs further exploration for large-scale commercialization. This particular silk can be used in surgical sutures (which will help address the high demand for 300 million procedures annually in China), smart materials, military, and aerospace technology. Another innovation, as of April 2023, is the creation of a new synthetic fiber, 30% lighter than cotton, which mimics the structure of polar bear fur. Massachusetts Institute of Technology (MIT) researchers have developed this fabric using two materials - a synthetic polymer and a nanoscale fiber.

The synthetic fibers category is fragmented. Textile manufacturers are increasingly engaging with regional players to gauge consumer behavior/preference patterns and capture a wider domestic market. Large companies such as Indorama, Mitsubishi, and Sinopec have integrated in-house manufacturing facilities that can produce the fibers from start to finish. Hence, the bargaining power of such specialized large-scale suppliers is moderately high. Regionally, there are numerous players based on different types of polymers which add to increased fragmentation and reduces the bargaining power to low.

The key cost components include raw materials, energy, equipment and technology, labor, facilities, and marketing. Other costs can include legal and tax, indirect or overheads, repairs and maintenance of plants or facilities, transportation, etc. Synthetic fibers production needs a significant amount of crude oil and energy. Acrylonitrile is the key raw material for producing acrylic fabric. The synthetic insulating material known as fleece is made of polyethene terephthalate. Polyamides are needed to make nylon. Similarly, olefin is another material composed of fibers of polypropylene and polyethene. Hence, raw materials form a crucial cost component and any fluctuations in the cost of raw materials will dramatically impact the total cost of production.

Synthetic fibers and cotton prices witnessed a decline between April and August 2023 owing to low demand. Prices of most of the fibers decreased by 20% in 2023 compared to 2022. The increasing price difference between synthetic fibers and cotton caused cotton to be replaced by synthetics. Feedstock prices including dissolved wood pulp (used mainly in viscose rayon production) and PTA also decreased during the same period in 2023. In Q3 2023, polyester fiber prices decreased by USD 1 - 1.20 per kg. Polyester fiber prices dropped by 20% in 2023 compared to 2022. There was still a significant difference in domestic polyester fiber prices between China and the two South Asian denim manufacturers, India and Pakistan at the end of Q3 2023. In China and India, the average prices of “1.4 denier 38 MM staple fiber” reached USD 1.05 and 1.25 per kg, respectively at the end of September 2023.

Almost 60 - 70% of the category is produced in China. It is presently the world's largest producer and exporter of synthetic materials, accounting for the great majority of the category output. As of December 2023, globally, the top three exporters of this product are China (accounting for 606,297 shipments), Germany (accounting for 574,716 shipments), and Spain (accounting for 516,399 shipments). Although synthetic textiles and fibers are all composed of a kind of polymer, they are all valuable for different applications due to their distinct properties. Hence, when selecting vendors, key features such as elasticity, tensile strength, density, temperature resistance, moisture absorption, etc. of the polymer should be identified in order to choose which polymer to employ in the final product. Other considerations include procuring raw materials from low-cost countries like India and China and negotiating with more than two vendors to gain higher margins. In the synthetic textiles sector, from the production of raw materials to the delivery of finished goods, India has established itself as a self-sufficient industry with significant value addition at every level of operation. Hence, it is considered as a major outsourcing hub. Low labor costs coupled with the availability of raw materials and high product selection make India an attractive nation for outsourcing activities. 

Synthetic Fibers Procurement Intelligence Report Scope