Focus: Iran war hits Asia's polyester suppliers to global fast fashion

• Indian polyester yarn producers face 30% higher costs for petroleum-derived feedstocks (PTA and MEG), with polyester fiber prices jumping from 100 to 120 rupees per kilogram since late February
• Surat textile mills have slashed production by up to 65% (from 10,000 to 3,500-4,000 meters daily) and increased weekly shutdowns, with suppliers warning of 15% price hikes that customers may reject
• Bangladesh thread supplier Coats announced 15.5% price increases effective April 15, while sneaker manufacturers face rising costs for 25 petrochemical-based components including EVA foam and synthetic rubber

Summary: Iran War Disrupts Asian Polyester Supply to Global Fast Fashion

The ongoing Iran conflict is severely impacting Asia's polyester industry, threatening higher costs for major fast-fashion retailers including Zara, H&M, Target, Walmart, and IKEA.

Key Price Impacts:

• Filatex, a major Indian polyester yarn producer, reports 30% increases in feedstock costs (PTA and MEG)
• Indian polyester staple fiber prices jumped from 100 rupees/kg in late February to 126.5 rupees by March, settling at 120 rupees by April 9
• Coats Bangladesh announced 15.5% price increases on polyester thread effective April 15

Production Disruptions:

Radheshyam Textile in Surat reduced daily production from 10,000 meters to 3,500-4,000 meters, with half its 200 looms idle. Bindal Silk Mills reports inability to meet global orders due to labor shortages caused by cooking gas scarcity. Surat factories now shut two days weekly, up from one.

Supply Chain Context:

Polyester represents 59% of global fiber production, making it highly vulnerable to petroleum price shocks. Only 12% comes from recycled sources, though retailers like H&M and Zara increasingly use recycled polyester for partial cushioning.

Retailer Response:

Primark reports spring/summer stock unaffected due to forward buying. H&M expects price increases from Bangladeshi suppliers but plans to absorb costs. Bangladesh's garment sector faces higher thread and logistics costs despite producing cotton clothing.

Broader Impact:

The crisis extends beyond apparel—sneaker manufacturers face rising costs for 25 petrochemical-based components including EVA foam and synthetic rubber. Analysts warn of "demand destruction" if the situation persists beyond one month, forcing retailers to raise prices and reducing consumer purchases.