Amid widespread economic disruption, textile manufacturers are taking a big hit to business.
The International Textile Manufacturers Federation (ITMF), in its fourth coronavirus business impact survey among its members and affiliated companies and associations about the pandemic’s effects on the textile value chain, found orders down 42 percent globally this year compared to 2019.
On average, companies are expecting their sales to plummet 32 percent in 2020 compared to last year. The range between regions runs from a decline of 22 percent in South East Asia to 36 percent in East Asia.
All segments in the textile value chain–from spinners to garment producers–recorded significant decreases in orders. In all segments of the global textile value chain, orders are down in the range of 37 percent to 46 percent.
Sales in 2020 are down in the range of 26 percent to 34 percent compared to 2019. Integrated producers seem to have fared slightly better with a 26 percent average decline, while the fiber, fabric, yarn and garment producers said sales have fallen in the range of 31 percent to 34 percent.
Asked when they expect to reach pre-crisis levels again, 23 percent said they were expecting this to occur in the first quarter of 2021, followed by 21 percent indicating the second quarter of 2021 and 14 percent in the third quarter of 2021. However, 20 percent of the 600 companies participating in the survey are expecting a faster recovery in the fourth quarter of 2020.
This was the fourth survey conducted by ITMF since mid-March, when the global coronavirus outbreak mushroomed into a pandemic affecting all regions of the world.
The World Trade Organization (WTO) said Monday that the volume of merchandise trade shrank 3 percent year‑on‑year in the first quarter. Initial estimates for the second quarter, when the virus and associated lockdown measures affected a large share of the global population, indicate a year‑on‑year drop of around 18.5 percent.
“The fall in trade we are now seeing is historically large–in fact, it would be the steepest on record,” WTO director‑general Roberto Azevêdo said. “But there is an important silver lining here–it could have been much worse. This is genuinely positive news, but we cannot afford to be complacent. Policy decisions have been critical in softening the ongoing blow to output and trade, and they will continue to play an important role in determining the pace of economic recovery. For output and trade to rebound strongly in 2021, fiscal, monetary and trade policies will all need to keep pulling in the same direction.”