The Russian textiles industries are on the verge of crisis, due to the ongoing decline of the Russian economy, caused by Western sanctions and the devaluation of the national currency, the ruble.
According to analysts at the Russian Ministry of Industry and Trade, amid the ongoing economic instability in Russia, the demand for technical textiles and nonwovens in the domestic market has significantly declined, with the biggest rates of decline being observed in the middle and high price segments.
Analysts believe that this is mainly due to currency jumps; the ever growing volume of illegal re-exports of technical textiles and nonwovens to Russia through the other countries of the Customs Union, and in particular Kazakhstan and Belarus; volatile commodity prices and the high level of depreciation of equipment at the majority of the industry’s enterprises.
During the period January-October this year, the volume of production of technical textiles and nonwovens in Russia has declined by about 15%, compared to the same period last year, and according to analysts’ predictions, the decline will continue until the end of the current year. At the same time the share of counterfeit and illegal imports and re-exports in the total structure of the market reached 30-35%. The current situation in the market is aggravated by the ever-growing prices for finished products.
Andrew Razbrodin, president of the Russian Union of Entrepreneurs of Textile and Light Industry, the association, which unites the Russian leading producers of textiles and technical textile products said that in the case of technical textiles, the increase in prices for raw materials, and in particular for synthetic fibres and yarns, has resulted in a significant increase in prices for finished products and there is a possibility that prices will continue to grow during the next few months.
According to analysts, another reason of the ever deteriorating situation in the industry is the ever growing production costs, and in particular for energy and labour. At the same time in recent years, despite all the state promises, taxes in the industry have also increased.
