Polyester production is growing at a faster rate than all other polymers

Polyester production is growing at a faster rate than all other polymers

Fibre, textile and apparel companies are dealing with an intense and growing pressure to deliver greater transparency across the supply chain. But where does their knowledge begin and end? When it comes to sustainability in the polyester production process, the picture is increasingly complicated according to The PCI Consulting Group, which has spent the past four years researching the issue.

Thanks to the commendable life-cycle assessment (LCA) analysis carried out by individual brands and retailers, and captured within leading organisations like the Sustainable Apparel Coalition (SAC), an immense interaction and knowledge base is building within the textile industry as a whole – especially on the relative merits of processing different fibre types.

But what about looking further upstream into the petrochemical sectors? Is there any notable environmental differentiation, by region, by country or even by asset? Our research suggests there is indeed a distinct environmental profile amongst the petrochemical plants that feed the polyester chain – and that the sustainability credentials that lie behind the production of these fibres can vary considerably.

Before we discuss the implications of this analysis, some fundamental questions are being asked by the industry as it comes to terms with the need to create more sustainable supply chains. What is the meaning of sustainability in the context of textiles? How will it impact our world? Are there any business opportunities or is it swamped in regulation? How can the global textile industry achieve ultimate transparency and who will lead the charge – will it be the Chinese manufacturers?

Setting out sustainability

The concept of sustainability is not a new one. It was formally defined, according to the Brundtland Commission in 1987, as meeting today's needs without compromising the ability of future generations to meet theirs.

This wide remit goes well beyond the everyday concept of 'green' and encompasses economic, social and environmental goals. As such, sustainability is now core to many businesses' corporate and social responsibility (CSR) commitments. To date, most of the attention has been specifically drawn to the consequences of carbon emissions; that is to say, climate change.

The United Nations Framework Convention on Climate Change (UNFCCC), the Intergovernmental Panel on Climate Change (IPCC), in 2013 calculated the world's carbon budget: the amount of carbon dioxide emissions that can arise from human activity before global temperatures rise 2°C above pre-industrial levels.

This carbon budget is set at one trillion tonnes of carbon, of which we have already burned through 52% since 2011. We are on track to spend the remainder in the next three decades. The impacts of climate change are already visible today, as noted by the IPCC, with a rise in sea levels, increased forest fires, heavy precipitation events, and droughts in different regions.

The potential for increased government regulation to counteract unsustainable practices can be difficult to navigate and may threaten to change the way many industries operate. Some regulation has already led to increased costs for businesses operating 'as usual'. However, as always, change can lead to rewarding opportunities and, with new regulatory constraints and consumer awareness, entire industries are now embracing sustainable practices.

Polyester industry

The textile industry is certainly doing its best to clean up its act. Take polyester as an example.

Polyester is produced globally at around 65m million tonnes per annum; it is the third most produced polymer after polyethylene and polypropylene, with diverse applications in both packaging and textiles. It is growing at a faster rate than all other polymers and has a mature and competitive supply chain operating from refineries through petrochemicals, fibres and textiles to a multitude of products used on a daily basis throughout the world.

Polyester is a truly dynamic global commodity and today the industry is dominated by Chinese manufacturers who produce over 50% of total world's output of both fibres and packaging resins.

At the midstream level, China is certainly embracing the need to clean up its act in the production of manmade textiles, as it is transitioning from its image as the "dirty" manufacturer of the world to a leader driving environmentally-friendly technologies. This drive is not being driven out of sentiment but rather as a cold business calculation.

The WTO may not get its wish for zero duty on eco-friendly goods, since fibres and textiles are bedevilled by a lack of uniformly agreed and formalised standards. However, the signpost to the future is clear. A race has started and China is determined to win it, as effectively as it has won most of the fibre/textile/apparel races over the past 20 years; by single-minded centrally-focused programmes which other countries will struggle to emulate.

China cleans up
Behind China's opportunistic stance is the reality that it is actually running very hard with the environmental theme. This is driven by a complex range of factors:

  • Chinese personal wealth is rapidly increasing, and rising wealth provides economic space for more progressive choices around health and lifestyle – increasingly evident as environmental protests becomes more widespread and insistent within China.
  • As China's labour costs have risen it has embarked on a ferocious programme of high-tech equipment purchase. Recent studies (2013) indicate that China bought 66% of the global supply of new weaving looms, 71% of circular knitting machines, and 60% of draw texturising machines, and the country is undoubtedly sitting on the most modern machine-parc in the world. This has meant not only that its unit labour costs are actually going down rather than up in many textile sectors, but that its other inputs such as energy, dyestuffs and effluent are being assiduously managed. In other words, a simple efficiency drive is putting China in the forefront of global environmental response in textiles.
  • 'Green' sells. If not directly to mass consumer markets (the committed green consumer is still a fairly rare species), then certainly to retail, which is mortally afraid of being labelled a polluter. China has recognised that pandering to Western environmental consciences can enhance commercial opportunity.
  • China remains a highly centralised state-controlled economy, able to issue edicts which other countries would find breathtakingly ambitious. The recently-announced measures imposed on the Chinese dyeing industry to clean up China's seven major rivers are a powerful example. In any race to impose 'eco-friendly' systems within an entire industry, China has an in-built advantage with its centralised state-managed economy.

Questions add to complexity
But can the Chinese adapt fast enough from a cost and scale driven mentality, to the growing requirements and influences of sustainable and transparent supply chains? For example we are asking whether or not there is a disconnect between China's efforts to clean up its textile supply chains (along with its on-going drive to maintain sizeable influence and market share of global apparel supply) and its current ambitions to create a new generation of coal based polyester raw materials (Coal to MEG).

Also, on the other more significant side of the polyester production process, are all of China's PTA and paraxylene units as environmentally efficient as they could be in terms of CO2 emissions standards, and how do they compare to operations outside China?

Global brand owners and retailers, who are driving the sustainable agenda and often depend on a low cost source of products out of China, really want to have a better understanding of how "green" China's polyester supply chain is at the front end. But on closer inspection of its petrochemical slate, will this lead to some rather uncomfortable conclusions?

Meanwhile bio routes into the textile chain, along with a high degree of recycle, are alternative ways to reduce the carbon footprint. But how realistic is this to achieve in practice?

In China's case, its moral obligation for environmental responsibility is reinforced by an economic impetus in which recycled materials and modern, efficient manufacturing processes result in a recipe for eco-leadership and business success. But its existing infrastructure in petrochemical feedstocks for polyester production is so vast that, so far, there is little emphasis given to bio-sourced feedstocks.

Outside of China over the past decade, there has been a surge of technological advancements in the development of bio-chemicals, namely the precursor chemicals for polyester: biomass-derived monoethylene glycol (MEG) and paraxylene (PX).

The PCI Consulting Group has studied these alternative routes, both from an economic and environmental perspective. While such 'bio' routes can deliver savings to the carbon footprint relative to their crude oil-derived counterparts, there are other issues to consider, such as land and water use.

One of these key issues is the availability of biomass and, as a result, the arable land areas required. By assessing yields along the biomass supply chain, if 25% of global polyester production was to be produced using sugarcane as a biomass source, this would require over half of Brazil's 9.8m hectares of sugarcane planted area, and is larger than Brazil's sugarcane bioethanol industry.

These calculations put the biomass industry into perspective. Ethical resource management considerations must be made too, and while we have become accustomed to the products and energy we desire, food is irreplaceable.

Based on these concerns, the bio-chemicals market is unlikely to become the sole solution for companies looking to embrace more sustainable practices. In fact, much can be accomplished by responsibly sourcing the feedstocks within the supply chain.

As such, The PCI Consulting Group is developing an understanding of the environmental impacts for individual assets. The granularity provided by such an assessment can have significant implications for the industry. This asset-based understanding provides the industry with the capability of understanding which producers deliver the more sustainable product. It also provides insight for producers within the supply chain to understand their position relative to others on the basis of environmental impact rather than just cost, and consequently highlights the areas within the industry most critical for improvement.