Two of the leading associations representing the nonwovens industry have recently reported on the impact of the coronavirus pandemic on this sector.
Production of nonwovens in Europe in 2020 was 7.2% higher than the year before, significantly outpacing the average annual growth rate (AAGR) of 4% over the past decade, according to EDANA of Brussels, Belgium. EDANA’s figures would be considered cause for celebration in more usual circumstances, but are exceptional when recorded in a timeframe that has seen global economies shrink by record margins. Economic Affairs Director, Jacques Prigneaux, says the high demands for nonwovens used for personal protective equipment (PPE) during the crisis have had a profound positive influence.
Prigneaux’s comments were to be echoed by those of his counterpart at Raleigh, North Carolina, USA-based Association of the Nonwoven Fabrics Industry (INDA), Brad Kalil, when he gave preliminary insights into the findings of the Association’s annual publication for members, Supply Report 2020, during a webinar on 6 April entitled Spunbond/spunmelt/spunlace Capacity Demand Scenarios Prompted by Covid-19. Kalil sub-titled his presentation “Understanding the State of the Nonwovens Industry and a Market Gone Mad” and the webinar’s moderator, Dave Rouse, President of INDA, reinforced this message when he said the event had been prompted by the “frantic level of new machine and new capacity announcements in the nonwovens industry”.
Kalil compared the supply and demand situation in North America during the period up to 2020 (“pre-pandemic”), during 2020 (“pandemic”) and 2021 onwards (“post-pandemic”) and concluded it was a “great time to be in nonwovens”—an industry: where production is consistently growing faster than the economy as a whole; where there is nevertheless sensible management of capacity growth; that is attracting investment; that is contributing to the protection and improvement of lives, particularly during the pandemic.
Kalil also spoke about how the industry overcame the challenges of 2020. Following a period of measured investment, US production (more than 5 Mt a year) had risen to about 85% of its capacity by 2019, and the sudden impact of greatly increased demand early in 2020, together with supply issues from China, which was the first country to be impacted by the spread of coronavirus, rapidly left the local industry effectively sold out of fabric. However, companies adapted their production to make what was needed, Federal and State governments helped with investments in additional lines, and bottlenecks in existing capacity were resolved to overcome shortfalls.
As a result, net nonwoven capacity in North America had grown by about 2.7% during 2020 (137.4 kt) with the addition of more than 100 lines, mostly for needlepunched, thermally bonded and hydroentangled fabrics, together with the rapid installation of 22 meltblown lines (17 kt of capacity). At the same time, other lines were converted to make the much needed fine-fibre electrostatically charged fabrics used in the production of high-quality facemasks and respirators. (The net figures also take into account the closure of nearly 30 lines, Kalil added.)
Investments will continue with pledges already made for US$187 million in 2021 that will add 84.8 kt capacity through the installation of new lines and incremental additions to existing ones. This will include more meltblown lines, the restart of a spunmelt line, a new spunbond line, a needlepunch and drylaid/hydroentangled line, and incremental increases in spunmelt and hydroentangled capacities. A further US$258 million in investment has also already been announced for 2022.
These actions have filled the USA’s gap in the supply of these vital materials, INDA estimates, but what of the future? Could the sharp peak of investment during 2020-2022 undermine the premise that the industry manages its capacity growth sensibly? Much could depend on the long-term demand for materials for personal protective equipment (PPE), which will be subject to a lot of hard-to-assess factors such as possible switches in consumer behaviour, potential interventions by governments (see also, US associations urge legislators to deem textiles and nonwovens manufacturing facilities essential), the introduction of product standards, and stockpiling in anticipation of future emergencies. While it is difficult to foresee how these play out, Kalil thinks the long-term demand will be around 10% higher than the pre-pandemic period, but still considerably lower than the peak requirements seen in 2020.
However, the sharp peak of investments is broadly the same as that which would have occurred over a five-year period under more usual circumstances and any drop in demand for PPE can be partly compensated on this timescale by the return of markets, such as building/construction and automotive, that were badly affected by the pandemic. In addition, the broad trend before the pandemic was for above average growth in this sector. Nonwovens will continue to be a great industry in which to be involved.