By Chris Wilcox, Poimena Analysis | Source: CIRFS, USDA, ICAC, IWTO
Wool producers and others often comment on wool’s small market share by volume of the global textile market, implying that it should be greater. But, does the volume share of the global textile market really matter for wool?
According to the latest data from the soon-to-be-released 2016 Market Information Report from the International Wool Textile Organisation, wool’s share of the world textile fibre market in 2015 is just 1.2%. This is down from 1.5% in 2010 and 2.5% in 2000.
As figure 1 shows, wool’s share of world mill consumption of textile fibres has declined steadily since 1960. A large factor in this decline has been the enormous increase in the consumption of man-made fibres, in particular oil-based synthetic fibres such as polyester, nylon, acrylic, polyamide and so on. In the 50 years between 1965 and 2015, annual consumption of these fibres has increased by 30 times. Over the same period, annual consumption of cotton has doubled and consumption of cellulosics (e.g. viscose, rayon) has almost tripled. In contrast, consumption of wool has fallen by 20%.
The increased consumption of oil-based synthetic fibres is due to the huge increase in production of these fibres as the technology developed for their production, bringing with it significant cost efficiencies and lower prices. The increased availability and lower prices of these fibres meant that textile fibres were increasingly used in a wide variety of end-uses, not only in apparel and in interior textiles, but also in industrial, building, automobiles, medical, furniture and household uses. Very few of these sectors use wool.
Cotton production also benefited from new varieties and widespread adoption of new production technologies in the growing and harvesting of cotton. Production of cellulosics has increased, notably in the past decade, as a result of improved production techniques and new, large mills in China. Figure 2 shows the trends in production of fibres that most compete directly with wool – cotton, cellulosics and polyester staple fibres (polyester staple and acrylic).
Wool production, on the other hand, is constrained by competition for land–use from other agricultural enterprises, notably cropping, and increased demand for animal-based protein for food. It cannot hope to keep pace with the increased production of other fibres, notably synthetics, nor can it compete with the cost efficiencies of massive-scale production of man-made fibres. Furthermore, it is not nor will it ever be used in some sectors that use man-made fibres, notably in industrial uses (for example, conveyor belts).
Therefore, the decline in wool’s market share by volume of the total world consumption of textile fibres is both inevitable and irrelevant. Given that wool is around five times the price of competing fibres, wool’s value share of key market segments is more important. In apparel, these segments include men’s business wear (suits, jackets, trousers), men’s and women’s outercoats, traditional knitwear (jumpers), and a growing presence (although still small) in active leisurewear.
While there are no data on value share of fibre consumption, trade data can give an indication. For example, wool’s value share of the global men’s business wear trade was 12.2% in 2014. Wool share of the value of world trade in men’s suits was just under 70%!
World consumption of textile fibres will continue to increase in coming years in response to higher incomes and rising global population. This increased consumption volume will largely be met by other fibres, probably man-made fibres. Nevertheless, wool will see the benefit of this higher consumption in the form of higher value demand. It will be best placed in meeting consumer needs in core wool-based clothing products, such as men’s suits, overcoats for men and women, higher-priced knitwear, and in growing market segments such as active leisurewear, as well as in higher-priced carpets.
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