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China's chemical fiber industry eliminated over one million tons of poor quality production each year
At the 12th China International Chemical Fibre Conference held in Jiangyin City, Jiangsu Province on the 8th, it was revealed that over recent years, the Chinese chemical fibre industry has experienced a significant acceleration in structural adjustment. This is primarily driven by rising raw material costs and increasingly fierce market competition. As a result, substandard production capacity has been steadily phased out, with hundreds of thousands of tons of inefficient facilities being eliminated annually.
According to Xu Kunyuan, vice president of the China Textile Industry Association, during 2004 and 2005, the polyester industry removed low-quality production capacity at a rate of 1 million tons per year. Fiber-grade polyester saw the most significant reductions, with as much as 90% of its production capacity being eliminated. In 2005 alone, the viscose staple fiber and nylon sectors eliminated 166,000 tons of outdated production capacity, largely due to their small scale and outdated technology.
Currently, the industry structure continues to improve, with the "three concentrations" becoming even more evident. First, production capacity is concentrating among large enterprises. In 2005, there were 22 companies producing over 200,000 tons annually, totaling 9,080,000 tons of capacity, which accounted for 47.2% of the total. These enterprises had an average annual output of 413,000 tons. Additionally, 59 companies produced over 100,000 tons, and 93 companies exceeded 50,000 tons annually. These are the key players driving China's chemical fibre industry in both domestic and international markets.
Second, production is concentrating in specific regions. As a major supplier to the textile industry, the chemical fibre sector is aligning itself with textile clusters. The majority of these clusters are located in eastern provinces like Jiangsu and Zhejiang, where there are 44 textile clusters—half of the country’s total. Similarly, 27 chemical fibre clusters are found in these two provinces, making up 68% of the national total. In 2005, Jiangsu and Zhejiang accounted for 12.56 million tons of production capacity, or 65.2% of the national total.
Third, production capacity is increasingly concentrated in private enterprises. By 2005, private companies controlled over two-thirds (66.77%) of the total production capacity, while state-owned and state-controlled enterprises saw their share drop to 27.4%. This shift highlights the growing influence of private players in shaping the future of China’s chemical fibre industry.