ITMF: Business expected to boom in next 6 mon...

Business expected to boom in next 6 months

(Source: ITMF)
(Source: ITMF)

The business situation is at a new low point since the ITMF started the Global Textile Industry Survey (formerly Corona Survey) in 2021. At the same time, business expectations in 6 months-time have soared and respondents are globally positive about business in June 2023.
Respondents to the 18th Global Textile Industry Survey by the International Textile Manufacturers Federation (ITMF), Zurich/Switzerland, confirm that order intake has continuously decreased since November 2021. In January 2023, the indicator was negative in all regions and segments except for North and Central America and fiber producers. The latter saw orders rise for the first time since last summer. The previously high global order backlogs also steadily decreased.
High inflation and rising interest rates are the main current drivers of the global economy, but the core problem of the textile supply chain in 2023 are high inventories at the brand and retail level. With the opening of economies around the world after the Covid crisis, consumers had the opportunity to spend the money they could not during 2020 and in the first half of 2021. Consequently, demand soared, and brands and retailers increased orders to meet this pent-up demand. With inflation rising, especially after the Russian invasion of Ukraine in February 2022, demand for consumer goods slowed while inventories remained very high.
In the next 6 months, textile manufacturers expect a better situation due to 2 important factors. First, the world is now in a much better energy situation with a relatively mild winter in Europe and energy prices in Europe and Asia (especially for gas) dropping back to levels seen before Russia’s invasion of Ukraine. Second, the sudden end of the Zero-Covid-policy in China with a swift opening of the borders is promising to strengthen demand in China as well as abroad.

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