Page 9 - TEXtalks. July- August 2023

09

ITMF: Textile business

situation improves for

the first time since

November 2021

The business situation remains negative but improves for the first time since
November 2021. According to the ITMF’s Global Textile Industry Survey (GTIS)
conducted in the first half of July 2023, the business situation improved on
average worldwide in July 2023 despite remaining negative. An increasing number
of companies have adapted to the harsh business environment and are now
reporting improvements. A regional analysis shows that Asia is struggling the most
and South America is back in positive territory. The global business expectations
did not change since March 2023. All regions remain optimistic about the situation
in 6 months-time, except for East Asia. Weavers/knitters and
dyers/finishers/printers are two segments where the expectations have turned
negative.

Order intake remains negative in all regions and all segments despite a slight
increase recorded in July 2023. Garment, home textile, and technical textile
producers have registered significant improvements, though the balance stays
negative. Order backlog fell to the lowest level recorded in the GTIS. An increase
could be observed only in South America and for technical textiles. Globally,
companies are not expecting order intake to improve in such a manner that order
backlog goes up significantly. The capacity utilization rate hit the lowest level since
the start of this survey as well. It has steadily decreased in Asia and Europe since
2021 and dropped for home textile and technical textile producers lately.
The major concern worldwide remains by far “Weakening demand” in July 2023. A
second distant concern is “Inflation” closely followed by “Higher raw material
prices”, “Geopolitics”, and “Higher energy prices”. Some positive signs are that
costs for logistics, energy, and raw material have fallen in the past few months,
and “Geopolitics” has not risen in the ranking. The number of canceled orders
remained relatively low globally. Most companies in the textile supply chain report
average or low inventory levels which make cancellations obsolete. Interestingly,
96% of garment manufacturers report average or low inventory levels. Spinners,
weavers/knitters, and fiber producers report the highest inventories.

July/August 2023