Technical Textiles & Nonwovens –a global market overview

Michael JäneckeDirector Brand ManagementTechnical Textiles & Textile ProcessingMesse Frankfurt Exhibition GmbH

Messe Frankfurt corporate group 2015: A global player in the trade fair sector

- Organizer of 132 trade fairs worldwidemore than half outside Germany

- 29 subsidiaries worldwide,50 international Sales Partners, covering more than 160 countries

- Turnover: 645 EUR million - 89,800 exhibitors - more than 4 million visitors

´ - Total area: 592,127 m2

2

33

Texpertise Network: Global market leader with over 45 events in 9 countries

Dubai

Markets

6

1. Technical textiles are among six major segments for investment opportunities (see recent major take over in Europe and the US)

2. Global textile fibre consumption at 85 mn tonnes is growing at 3% (overall). Technical textiles are growing above the average.

3. Man-made fibres will increasingly dominate textile raw suppliers. Cotton is growing below average

4. Asia dominates primary textile production. Vietnam is outgrowing China

5. Global trade in textile & clothing is growing at 5% CAGR so faster than final demand. Globalisation of supply chains continues

Source: Gherzi: Global Market Scenario and Trends

5 mega trends are shaping the global textile industry

7

Source: Gherzi: Global Market Scenario and Trends

The market for technical textiles: Growing worldwide

The technical textiles market is expected to hit 175 billion US-Dollar by 2020, almost doubling from 93 billion US-Dollar in 2000

Technical textiles account for 27 percent of worldwide fabric production

8

Sources: Gherzi Consulting, Euratex, innovationintextiles.com

9

Rest of the world17%

EU16%

India18%

Americas19%

China 30%

GLOBAL MARKET SHARES FORTECHNICAL TEXTILES 2011

China and India account for almost half of global production

Source: Commerzbank

10

Source: Gherzi: Global Market Scenario and Trends

11

Agrotech7%

Buildtech7%

Clothtech6%

Geotech1%

Hometech7%

Indutech17%

Medtech7%

Mobiltech22%

Oekotech1%

Packtech5%

Protech5%

Sporttech 15%

PROPORTION OF GLOBAL SALES IN 2010FOR ALL 12 AREAS OF APPLICATION

Source: Commerzbank

The market for technical textiles

12

Markets:

China

The technical textiles industry in China

China remains the world’s largest producer of textiles and clothing, however, the industry only grew by 6,4 percent in 2014

The biggest industry advantage has been the production of a large quantity of low-, middle- and high-quality textiles

- Overall, industry investments have become more active which lead to a solid growth in production and exports of industrial textiles and nonwovens

- In the first half of 2014, production output increased further to 7 percentfor industrial textiles and 8 percent for nonwovens

- Plastic coated fabrics, medical textiles, nonwovens, canvas textiles, bags and fiberglass account for 80 percent of all exports

Source: innovationintextiles.com13

The technical textiles industry in China

The industrial textile industry continues to be the major driving forcewithin the Chinese textile industry as the textile industry has focusedon technology, automation, productivity and sustainability

The domestic market is the biggest driver for the industrial developmentof textile industry in China

The country will experience steady growth in the Mobiltech*, Buildtech* and Medtech* areas, especially regarding nonwovens

More investments expected in the infrastructure construction, environmental management, health care, security and military defense

Producers of textile machinery see large potential for the market: About one third of all textile machines are older than ten years

Source: innovationintextiles.com*Copyright: Messe Frankfurt Exhibition GmbH

14

Cinte Techtextil Chinain Shanghai

Date: October, 12 – 14, 2016

• Symposium: in parallel

• Location: Shanghai New International Exhibition Centre, Shanghai

• Supported by:

Results 2014:

• Exhibitors: 459 from 22 countries & regions incl. pavilions fromBelgium, Germany, India,Italien, Taiwan

• Visitors: 12,496 from 61 countries &regions

15

KV Cinte

16

Markets:

India

The technical textiles industry in India

According to the Indian government, textile and apparel exports are to rise from their current 39 bn. USD to as much as 300 bn. USD by 2025

Investment in textile megaparks, improved infrastructure and a focus on synthetic fibres are all intended to help

While apparel is by far the largest domestic market for polyester in India, much has been made of the development of technical textiles

According to PCI Fibres, technical textiles in India currently amount to some 7% of mill consumption

Lower consumption tax on man-made fibres and filament yarns

Source: fibre2fashion

Other markets in Asia:The technical textiles industry in Japan

Functional apparel for sport and leisure – as well as technical textiles – is now coming into fashion as the Japanese apparel market has slowed down

According to Japanese customs statistics, Japan imported around 16 percent more technical textile products and almost 23 percent more nonwovens and felts in 2014 than in 2013. The main suppliers are China and the USA

Exports of technical textiles, too, grew encouragingly well, with an increase of 8.2 percent (6 percent for nonwovens)

Companies like Toray are currently extending their production capacity in South East Asia, including Indonesia, Thailand and Malaysia.

Source: GTAI and VDMA

Other markets:The technical textiles industry in South Korea

Exports of Korea textiles and apparel stood at 15.9 billion USD in 2013, representing a 2.3% increase over 2012

Imports accounted for USD13.5 billion in 2013, representing a 12.7 percent increase over 2012

Technical textiles, labels, badges and other textile products market amounts to 4,14 bn. USD in 2012 following 11 percent CAGR

Industry strongly dependent on foreign markets as exports represent nearly 50 percent of total production in 2012

Industry predicts to see 7 percent CAGR to reach 8,67 bn. USD until 2018

Source: KOFOTI

19

Techtextil Indiain Mumbai

Date: September 13 – 15, 2017

Symposium: in parallel

Location: Bombay Exhibition Centre

Results in October 2015: Exhibitors: 158 from 11 countries &

regions

Visitors: 5,050 from 31 countries & regions

Approx. 5,000 sqm gross

20

21

Markets:

USA

Source: GTAI and IFAI

The technical textiles industry in the U.S.

The technical textile industry is getting more importantGrowth in the U.S. specialty fabrics industry was about 2.2 percent in 2014 (worldwide growth: 2.6 percent) and is expected to be 2.7 percent in 2015

288 mio. USD in investment projects for technical textiles planned

Technical textiles have been responsible for 40 percent of all turnover in USA textile factories in 2014

The U.S.A have massively modernized their textile industry and are investing in technical and high-value textiles

Growth drivers:Military clothing, medical equipment, construction and industrial markets -especially the automobile/industrial market

22

The technical textiles industry in the U.S.

After decades of recession, things are again looking up for the NorthAmericantextile machinery industry

There is massive investment going on in the automotive and furniture industries – equally good news for textile manufacturers

From Germany, after South Korea the 2nd largest supplier of machinery, 12 percent more textile machines were imported in 2014 than in 2013

The U.S. is the biggest importer for German sewing and garment machinery

Source: GTAI and VDMA

• 2016, 3-5 May, AtlantaTechtextil North America + Texprocess Americas,in parallel JEC Americas

• 2017, June, Chicago Techtextil North America

Results in 2014 (Atlanta):

• Exhibitors: 365 from 26 countries Techtextil North America164 from 15 countries Texprocess Americas(plus 232 at JEC Americas)

• Visitors: 9,039 incl. JEC Americas (plus 45 % compared to2012)

Techtextil North America in Atlanta + Chicago &Texprocess Americas in Atlanta

24

25

Markets:

Russia

Date: February 24 – 26, 2016

• 8th edition

• Part of the first Russian Textile and LightIndustry Week

• Organizer: Messe Frankfurt RUS, Moscow

Prelimary figures 2016:

• Exhibitors: 120 from 15 countries incl. national pavilions from Germany, China,Belgium, Italy plus a European Pavilion

• Visitors:

Techtextil Russia in Moscow

26

Markets:

Europe

The technical textiles industry in Europe

The technical textiles industry in the EU represents roughly 30% of the total turnover in textiles (excluding clothing) of 30 bn. EUR

The top five exporters of technical textiles (DE, IT, FR, UK, BE) represent 60% of the total exports to the world by member states

Growth in Europe is mainly driven by two technologies:- Nonwoven with a growth rate of 60% since 2000- Composites with a growth rate of 75% since 2000

The top three applications areas in Europe are Mobiltech, Hometech and Indutech accounting for over 50% of total consumption

28

Source: European Union, Euratex

The technical textiles industry in Germany

Apparel & textile exports increased to 25 bn. EUR (+4 percent) in 2014

40 percent of the industry exports went to Russia (3rd biggest marketafter the European Union and the USA)

Germany is the worldwide leader in exports of technical textiles= 50 percent of the textile industry revenue (30 percent in the EU)

Germany is the European leader for composites (129 mio. t. in 2013)

German export rate for technical textiles: 62 percent (2013),

for nonwovens: 58 percent (2013)

16 German textile research institutions also make a significant contribution to the high level of innovation of the German industry

Source: Commerzbank

29

Key research areasTargeted research =

strategic developmentof industrial sector

Key issues– Demography– Climate change– Recycling– Use / consumption of resources

ArchitectureCity of the futureNutritionHealthEnergyClothingProduction, logisticsMobility

Source: Forschungskuratorium Textil e.V.

PERSPECTIVES2025Future areas of action for textile research

30

Techtextil in Frankfurt

Date: May 9 – 12, 2017

• Symposium in parallel

• Location: Messe Frankfurt Fairground

Results in 2015

• Exhibitors: 1,393 from 52 countries including 15 national pavilions

• Visitors: approx. 34,000 from 102 countries including synergy visitors from Texprocess

32

Texprocessin Frankfurt

Date: May 9 – 12, 2017

• Location: Messe Frankfurt Fairground

• Supporter VDMA, German Engineering Federation

Results in 2015

• Exhibitors: 273 from 33 nations

• Visitors: approx. 21,000 from 98 countries including synergy visitors from Techtextil

Summary: Overall industry outlook

Currently, Mobiltech, Indutech and Sporttech continue to dominate in terms of areas of application

However, other product groups such as Oekotech or Geotech, are clearly gaining ground

Mobiltech is also the area of application in which volume growth has outpaced sales growth to the greatest extent

Source: Commerzbank

Summary: Overall industry outlook

Overall, market drivers include:

global population growth

replacement of conventional building materials

increasing complexity of industrial production

expansion of healthcare

growth in vehicle production

growth in expenditure on sport and leisure products

permanent opening up of new areas of application

Source: Commerzbank

35

Thank you for your attention!

Contact:

michael.jaenecke@messefrankfurt.com

www.techtextil.com