Nonwovens in China: sunrise business is expanding.
No discussion of growth in the nonwovens industry may exclude the increasing trend toward globalization globalization
Process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world. Factors that have contributed to globalization include increasingly sophisticated communications and transportation . With a more equitable labor pool and developing customer base, the Asian nonwovens market, notably China, has led the way for international players.
A study of the region, conducted by INDA, the Association of the Nonwoven non·wo·ven
Made by a process not involving weaving. Used of textiles.
Material or a fabric made by a process not involving weaving. Fabrics Industry, Cary, NC, further shows that although Japan has historically been a significant economic power in the region, the country has experienced an economic slump for more than a decade, with its economy in a period of deflation deflation: see inflation.
Contraction in the volume of available money or credit that results in a general decline in prices. A less extreme condition is known as disinflation. for several years.
The Japanese nonwovens industry has had minor growth during the past several years due to a peak in development, prompting the move of some Japanese domestic nonwovens production to lowercost neighboring neigh·bor
1. One who lives near or next to another.
2. A person, place, or thing adjacent to or located near another.
3. A fellow human.
4. Used as a form of familiar address.
v. nations, most notably China.
With a population of more than 1.2 billion, potential for domestic demand has driven much of China's own nonwovens expansion. Unfortunately, Chinese nonwovens producers and converters have faced challenges sating the increasingly savvy domestic consumers who are demanding more sophisticated products as their disposable income disposable income
Portion of an individual's income over which the recipient has complete discretion. To assess disposable income, it is necessary to determine total income, including not only wages and salaries, interest and dividend payments, and business profits, but also increases.
The Chinese hygiene sector, which accounted for about 10% of domestic nonwovens production in 2002, has one of the highest projected five-year annual growth rates Growth Rates
The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures.
Remember, historically high growth rates don't always mean a high rate of growth looking into the future. in the industry and is attracting foreign investors which are eager to cash in on this potential.
In a recent industry address, Wang Yanxi, chairman of CNTA CNTA China National Tourism Administration
CNTA Central Nevada Test Area , China Nonwovens Technical Association, asserted that spunbonding is the most rapidly developing segment in China's nonwovens industry.
In 2002, said Mr. Yanxi, there were 76 spunbonding lines in the country, of which 65 were producing polypropylene-based nonwovens and 10 producing polyester. The remaining line produced a composite spunmelt nonwoven. Nearly half of these lines were built by Chinese companies Chinese owned companies can be defined as enterprises within mainland China, Hong Kong, Macau and the Republic of China (Taiwan):
Also highlighting the sharp increase in Chinese spunbond production is Guo Hexin, honorary chairman of the Spunbond Division of CNITA CNITA China Nonwovens and Industrial Textiles Association , China Nonwovens & Industrial Textiles Association, who reported a 56% rise in technology last year. Chinese spunbond capacity is now estimated at 267,396 tons.
These fabrics are used primarily in medical and hygiene, construction, packaging, furniture, filtration and agriculture applications. Chinese customers consume only 30% of these goods, Mr. Hexin stated.
Admittedly, Chinese nonwovens producers find their product not up to par with Western standards of quality and cite the gap in domestic consumption as a motivator for Chinese nonwovens producers to increase the quality of their products and tap the tremendous market within their own borders.
This lag in manufacturing capability has influenced foreign investors to target Chinese consumers with higher-quality nonwovens usually associated with Western standards.
In sync with the country's geographic development, Chinese nonwovens experts expect Eastern coastal regions including Liaoning, Shangdong, Jiangsu, Zhejiang, Fujian and Guandong provinces to be the center for industry growth in the near future.
"Regionally, (Chinese) coastal areas grow the most quickly and inner cities are also developing at a slower pace," said Wang Xuanrong, vice president of Kingsafe Group, a Chinese manufacturer of nonwoven fabrics.
"The western provinces have only a few nonwovens manufacturers."
The key to true economic development in China is to bridge the gap between the highly developed eastern coastal region and the largely agricultural western provinces.
Tapping this region, said those in the industry, is the key to maximizing access to a population of nearly 1.3 billion.
Attributing the country's explosion of roll goods manufacturers to inexpensive raw materials, producers say they once called that segment the "money printer" because of its potential for high profits.
>From 1995 to 1998, some report, growth of nearly 300% could be expected on roll goods sales, especially once domestic machine manufacturers developed converting machines that were affordable and reliable.
As demand for nonwovens goods increased within the country, said Dai Yajun, director of Shanghai Jinguang Nonwovens Co., Ltd, an increased willingness by customers to pay for those goods had those in the industry dubbing dubbing
removal of most of the comb of day-old chickens. See also decombing. it the "sunrise business." Shanghai Jinguang Nonwovens is focused on spunbond nonwovens, hygiene items and home furnishing products.
A recent rise in raw materials costs has those same producers predicting a profit "squeeze." In 2002, said Mr. Yajun, the price of a ton of polypropylene rose more than 30%, while the price for a ton of polyethylene rose nearly 15%. "If this trend continues, the cost advantages we used to have would be greatly diminished," he added.
Like any country with accelerated development potential, Chinese consumers are quickly becoming more educated and demanding newer, more sophisticated products. This fact was driven home in China during its recent battle with SARS. The epidemic increased the country's need for nonwoven disposable products such as face masks Face mask
The simplest way of delivering a high level of oxygen to patients with ARDS or other low-oxygen conditions.
Mentioned in: Adult Respiratory Distress Syndrome , protective clothing and wet tissues and resulted in a shortage of lightweight, nonwoven materials. It is reported that at the end of April and in early May 2003, several of China's converters started to urgently import some nonwoven roll goods from the U.S., Japan and Korea. This actually increased Chinese government's and the public's awareness of nonwovens products, prompting experts to predict a rapid increase in the production of medical and hygiene products using nonwovens.
As wages and global awareness increase, Chinese consumers will demand products from outside the nation's borders. Savvy foreign investors with an understanding of this potential are scrambling to gain a foothold there, betting that Chinese buying power Buying Power
The money an investor has available to buy securities. In a margin account, the buying power is the total cash held in the brokerage account plus maximum margin available.
Also referred to as "Excess Equity. will increase.
Triggered by its entry into the World Trade Organization, China has recently become a world leader in textiles production, and the country has persistently increased its exports. Foreign nonwovens companies wishing to continue global market leadership are transferring operations to new manufacturing facilities in partnerships with established Chinese companies.
Unlike other industries where such a shift has reaped significant labor savings, the nonwovens industry is not labor intensive Labor Intensive
A process or industry that requires large amounts of human effort to produce goods.
A good example is the hospitality industry (hotels, restaurants, etc), they are considered to be very people-oriented.
See also: Capital Intensive, Trading Dollars and therefore cannot benefit from China's labor pool. Moving to China, said some expatriate businessmen, is instead a method of pursuing a new customer base for nonwovens makers.
"If customers move their converting operations (to China) for the obvious reasons of cheaper production costs, it only makes sense to pass on added value Added value in financial analysis of shares is to be distinguished from value added. Used as a measure of shareholder value, calculated using the formula:
In response to a shift of some of its customers to Shanghai, roll goods producer PGI PGI Protected Geographical Indication
PGI Progiciel de Gestion Intégré (French: Enterprise Resource Planning)
PGI Phosphoglucose Isomerase
PGI Polish Geological Institute (Warsaw, Poland) Nonwovens has announced plans to build a new plant there to serve the medical and hygiene markets.
The site will house a state-of-the-art Reifenhauser spunmelt line and will double the Charleston, SC-based company's presence in China. PGI first came to China in 1999, following a large movement of customers in need of quality product. PGI has an 80% interest in the operation which is 100% run by Asian nationals.
Currently, there are two ways to categorize cat·e·go·rize
tr.v. cat·e·go·rized, cat·e·go·riz·ing, cat·e·go·riz·es
To put into a category or categories; classify.
cat Chinese nonwovens companies--size and strategy. There are smaller companies that utilize the lowest possible production costs to offer the cheapest possible products to gain the fastest possible market share.
Paulmann Yu, managing director of Gordian Nonwovens Technology Co., and director of the Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. Nonwovens Association, said the larger companies are pursuing technology advancement to offer higher quality products with the aim of gaining a significant marketshare.
Gordian Nonwovens, located in Shiyan, Shenzen, Guandong Province, manufactures both roll goods and end-use products. Nearly 90% of the company's products are exported to North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and Europe.
While companies such as Gordian enjoy success in exports, some large Chinese companies are successful domestically. Riding the boom in domestic hygiene demand, Fujian Hengan Holding Co., Ltd., has become a nonwovens success story by targeting Chinese consumers.
According to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. reports, the company has become the largest sanitary napkins manufacturer, the second largest disposable diapers manufacturer, the main adult diaper manufacturer within its own borders.
With the brand names including "Anerle" sanitary napkins and baby diapers, "Elderjoy" adult diapers and "MissMay" tend-and-protect products, the company has total assets of $240 million, operates a nationwide sales and distribution network and owns 23 Chinese subsidiaries in 14 provinces.
While those in the Chinese nonwovens industry remain optimistic op·ti·mist
1. One who usually expects a favorable outcome.
2. A believer in philosophical optimism.
op that growth will continue, many cite rising raw material costs, a lag in infrastructure development, and foreign competition that comes with WTO See World Trade Organization. privileg es as possible hindrances to progress.
"We are confident in the foreseeable future," said Gordian's Mr. Yu. "China's nonwovens industry should continue to grow fast, however, l, if economic overheating Overheating
An economy that is growing very quickly, with the risk of high inflation. occurs the industry could see damage."
Mr. Yu also points out that as foreign companies such as DuPont, BBA BBA
Bachelor of Business Administration and PGI have greater access to China through WTO, their advantages in capital and technology give them an edge their Chinese counterparts.
To become true global players, the Chinese believe, certain changes must occur within the industry. Chinese businessmen laud their government's efforts to open the economy and bridge the development gap between eastern and western regions in China, but they said there is some fine tuning Fine Tuning is the name of XM Satellite Radio's eclectic music channel. The program director for Fine Tuning is Ben Smith.
The channel is described as "A musical oasis for the sophisticated listener culled from every imaginable genre and country. to be done.
To be truly successful, said Mr. Yu, resources should be consolidated by joining the smaller companies with the large ones.
The strategy would unite the industry and ensure that all of the players are on the same page. And, he could not stress enough the importance of pouring resources into research and development.
Without that, he said, China cannot offer the quality of its Western competitors.
Editor's note Editor's Note (foaled in 1993 in Kentucky) is an American thoroughbred Stallion racehorse. He was sired by 1992 U.S. Champion 2 YO Colt Forty Niner, who in turn was a son of Champion sire Mr. Prospector and out of the mare, Beware Of The Cat.
Trained by D. : For more information, a complete version of this article is available at www.nonwovens-industry.com.