How much sustainable textile fibre supply will be available in 2030?

For the textile and fashion industry to succeed in its sustainability transition, its raw material supply needs to be radically changed. About two thirds of all textile fibres produced globally today originate from fossil fuel resources, which by definition are not sustainable over the very long term because they are simply not renewable. The other third is made of renewable biobased natural or man-made fibres, but most of which today would also not correspond to basic sustainability standards either, because of pollution, soil degradation, water stress or biodiversity loss associated with them. When looking at the apparel industry, which consumes just under half of all textile fibres produced, its raw material split is closer to 50:50 with general clothing, fashion and luxury more heavily weighted on the natural fibre side, while the sports and outdoor industry relying more on synthetics.

?When trying to understand textile material issues, the reports published by Textile Exchange are generally a good starting point and just last week they published jointly with Quantis, since late 2022 part of Boston Consulting Group, a report and related Material Manifesto entitled “Sustainable Raw Materials Will Drive Profitability for Fashion and Apparel Brands”. Compared to the typical Textile Exchange publication this BCG-branded report was much less data-rich but presented some bold claims, head-scratching future predictions and hands-on industry guidance. It was clearly targeted to management level readers that rarely find the time to dig into the technical details. But as this is something I like to do, I want to give it a thorough look under the hood to see if the claims and predictions hold water.

?I didn’t get far into the document, precisely to the subtitle on page 1, before stumbling over a weird claim. There it says “raw materials can constitute as much as two thirds of a brand’s climate impact”. That is way too high I think as I’m checking the footnote that follows the sentence and sure enough there it says it is “covering impacts from Tier 4 to Tier 2” of the fashion supply chain. The problem is that technically only Tier 4 which refers to fibre production/extraction such as cotton farming or synthetic or man-made cellulosic fibre production can be considered the raw material stage. But Tier 3 - spinning of yarn and Tier 2 making and finishing of fabric is where the majority of the climate impact (i.e. GHG emissions related to energy use in these processes) in the apparel industry happens. These emissions will not be impacted by your choice of an organic or a conventional cotton fibre to spin, weave or dye. I can understand that one wants to create a sense of urgency to tackle material issues, which do have their climate impacts for sure, but so blatantly inflating the case doesn’t really help the credibility of the whole endeavour.

?And unfortunately we are not yet done inflating. Exhibit 2 intends to visualise the huge sustainable raw material gap that the industry is likely to look at by 2030 if no drastic action is taken. This exhibit, which is one of the few original pieces of visual information from the report and which I already saw shared several times in news articles and social media, commits the cardinal error of equating the entirety of global textile fibre production to the raw materials used by the fashion and apparel industry.? A similar mistake was made by Quantis in their 2018 study as well as by earlier Ellen MacArthur Foundation work (later corrected). The reality, as I mentioned in the first paragraph and explain in much more detail here and here, is slightly below 50%, with a slowly shrinking relative weight because technical uses for fibres such as nonwovens and composites grow faster than apparel consumption on a global scale. So if we indeed reach 163 million tons of textile fibre + leather production in 2030, then likely only about 70 million tons will be used by the apparel industry. Still a massive amount, but better be in the right ballpark to start with when making predictions about the future. And yes, a discussion also needs to be had about the sustainability of the other 90 million tons of fibres/leather being used for interior and technical applications, but this is obviously not the subject of the BCG report.

?The next interesting figure is the percentage of raw materials considered as sustainable or preferred which according to Textile Exchange’s latest definition means “those that deliver consistently reduced impacts and increased benefits for climate, nature, and people against the conventional equivalent, through a holistic approach to transforming production systems.” This share is given as 19% overall. The report doesn’t contain more details about what these 19% are composed of, but the October 2022 Textile Exchange publication “Preferred Fibres and Materials Market Report” provides quite a detailed overview. In essence it represents some 5 million tons of Cotton that is somehow certified and therefore considered ‘preferred’, 9 million tons of recycled Polyester (rPET), essentially all from plastic bottle recycling and some 4.5 million tons of man-made cellulosic fibres (MMCF) made from wood of certified origin. All other fibre types and leather are essentially pocket change in the overall scheme of things.

?For the purpose of the forecasting exercise this 19% share is simply maintained for the year 2030, which if true, leads to an overall gap of 133 million tons of sustainable fibres under the assumption that each and every textile fibre user in the world would demand these fibres/leather to come from a sustainable or preferred source. Now that is a staggering figure but there is a lot that is wrong with it.

?Let’s start with the overall demand volumes. The forecasted total textile material demand is entirely plausible to me and may even be slightly underestimated. But the possibility that the entirety of this demand could be for sustainable materials is absolutely not. Literally all volume growth in fibre production is driven by demand from countries and market applications that are not likely to be subject to stringent sustainability legislation anytime soon. The markets with highest near-term regulatory impact are Western markets for fashion and other textile-based consumer products. How big are they in volume terms? Adding up the apparel consumption of the countries showing more than 1 piece of upcoming sustainability legislation on page 2 of the BCG report i.e. EU, US, UK, Canada & Australia and assuming 20 kg of per capita apparel consumption plus a 30% margin of material loss in the production chain gets us to about 25 million tons of sustainable material needed in 2030 (i.e. 950 million population by 2030 x 26 kg of material).

If 19% of the 163 million tons of forecasted 2030 global fibre production or 31 million tons was sustainable, we could meet this demand and still have 6 million tons left for companies wanting to offer more sustainable products in markets where they are not subject to strict legislation. Well then all is good. Problem solved, let’s move on to a more pressing issue, such as decarbonising the tier 1 to 3 textile production processes through electrification and low CO2 energy.

?Well not so fast, because there is a lot that is rotten in the state of the sustainable textile fibre supply today. To better understand it, let’s have a look at the 3 big components of the 19% sustainable or preferred fibre share claimed in the BCG report, i.e. polyester, cotton and MMCF.

?Basically all rPET produced today is (or claims to be) made of post-consumer PET bottle waste. This is material recycling for sure, but it turns a clean, high-quality, easy-to-recycle waste feedstock of one industry (the beverage sector) into a multi-material and often chemically loaded material mess of another sector (the apparel industry) for which no good industry-scale recycling options exit today. So basically a cutely labelled one-way street, that has nothing to do with true circularity. Regulators and the food packaging industry, which will need to fulfil it’s own recycling targets, will bring this farce to an end likely before 2030. I recently ran a LinkedIn poll to understand what experts believe to happen with rPET by 2030. Of the 117 respondents, some 60+% believe polyester fibre-to-fibre recycling will be mature enough to take over from the PET bottle by then. I’m more sceptical and would rather side with the 30% of respondents who either believe the recycled material percentage in polyester textiles will decline due to lack of rPET supply or that we will see more fake rPET material, which is declared or even certified as recycled while not been truly from post-consumer waste sources, including (allegedly) PET bottles that are just made to be immediately shredded again to turn them into the rPET coveted by the fashion industry.

So if BCG truly believes we will have 11.5 million tons of rPET available for the apparel industry (i.e. today’s 9 million tons growing at 3% p.a. until 2030), then I would like to learn who will build these industry scale post-consumer polyester fibre-to-fibre recycling plants in the next few years and at what estimated total investment cost. There are certainly a few promising pioneers out there, but none of them has moved beyond pilot plant stage so far. But given the time it takes to get such processing plants permitted, financed and put into production, we would need to see massive projects emerging in the next 2-3 years if we want to get anywhere near the forecasted demand by 2030.

?Now let’s turn to cotton. According to the Textile Exchange Preferred Materials Market Report 2022, some 24% of the 2020-21 harvest of 24.4 million tons was covered by some kind of programme that is recognised to be included in TE’s ‘preferred cotton’ statistics. The vast majority of this volume (i.e. 19% of total cotton production) is covered by the Better Cotton or equivalent programmes, while organic cotton only represents a paltry 1.4%. The percentage of cotton production considered ‘preferred’ by TE had gone up rapidly between 2011 and 2019 from 3% to 24%, but since then seems to stagnate in this approx. one quarter of total growing volume range. It is also quite curious to see the vast differences of the preferred cotton percentages across countries. The 2 biggest cotton growing countries China and India are at very low levels with 2% (not surprisingly given that 90% of Chinese cotton production is from the Xinjiang region) and 17% respectively, while Uzbekistan is basically at zero. Highly advanced countries like the US and Australia also have relatively low rates of 23% and 25% respectively, while a few outlier countries such as Brazil and Pakistan reach very high rates of 75% and 83%. Overall it seems Textile Exchange’s 50% preferred cotton target for the 2025/26 crop is quite a stretch. Beyond that, how truly impactful these various programmes are and how reliable their certification schemes is anybody’s guess. The weird (to say the least) statistics on organic cotton recently put into the spotlight by renowned cotton expert Terry Townsend don’t inspire confidence.

Finally for man-made cellulosic fibres, Textile Exchange estimated that in 2021 60-65% of those fibres are made from wood with a FSC or PEFC certification, which seems to be enough to merit TE’s ‘preferred material’ label. Both certification schemes have been in existence for well over 20 years and are generally well respected, although not without its own scandals and failures such as those documented by ICIJ’s Deforestation.Inc project. In addition, about 80% of global MMCF production is represented by viscose, made in a process heavily dependent on the use of hazardous chemicals such as ammonia, acetone, caustic soda and sulphuric acid, which if not well managed in closed loop systems has significant water and air pollution potential. Of the lesser impact alternatives only the Lyocell process has reached mass production scale, while other innovations mostly spearheaded by Scandinavian start-ups are still at pilot or very small industrial scale. The overwhelming majority of MMCF production is today located in Asia (China, India and Indonesia) and the preferred feedstock is the fast-growing eucalyptus tree, grown in monoculture forest plantations across many tropical and subtropical regions around the world where it has often replaced indigenous plant ecosystems. So in a nutshell, considering 60-65% of all MMCF production sustainable is likely a bit of a stretch and recently passed EU legislation aimed at banning import of deforestation-linked goods will put further pressure on all forest-linked global value chains including textiles to further clean up their act.

An interesting development is the chemical recycling of post-consumer cotton and other cellulose-rich waste streams into regenerated MMCF’s. Contrary to polyester F2F recycling, we have at least one operator, Renewcell in Sweden that has been operating an industrial scale plant with annual capacity of 60,000 tons since late 2022 and plans to scale up to 120,000 tons in the near future. Infinited Fiber in neighbouring Finland plans to have a 30,000 tons recycling plant up and running in 2026-27 with ambitious scaling plans in Europe and Asia thereafter. Around the same time S?dra of Sweden, collaborating with Lenzing, plans to have a 50,000 tons plant in operation. If all these plans pan out, we may be looking at close to 1 million tons of regenerated MMCF capacity by 2030. A lot has to go right for this to happen and even then we will only look at less than one fifth of the 5-6 million tons of sustainable MMCF demand forecasted by BCG.

In summary, the BCG report is a timely and useful call to action for the global fashion and apparel industry to play a more active role in the management of their raw material sources, which for too long has simply been taken for granted. It contains many practical action points that industry leaders can and should heed as a matter of importance and urgency. But it is built on a very weak analytical underpinning and a very rosy outlook of the likely state of supply of truly sustainable textile raw materials a mere 6 years from now. It doesn’t seriously consider the possibility that regulators, market surveillance authorities and competing industries may take current ‘preferred material’ options off the table faster than innovative material suppliers can provide better alternatives at scale.

In the light of this, any discussion of additional profit potential from adopting a more sustainable raw material strategy seems like arguing about the merits of picking up a few extra pennies in front a steamroller. Taking an active role in managing one’s complete supply chain all the way from raw materials to the consumer is simply an essential risk management strategy for any serious business operator in the fashion industry, like making sure there is always enough money in the bank.

To finish on an optimistic note, there is a lot that can and must be done to put global sustainable textile fibre supply on a rapid and sustainable growth path.

The biggest and easiest lever I see in MMCF production. Lyocell and other low-impact production processes are well managed and just need to be replicated in additional production plants around the world. Industry leaders such as Lenzing, Birla Group or Sateri as well as start-ups such as Spinnova or Tree-to-Textile are doing exactly that. Beyond certified virgin wood, there are a lot of cellulose rich waste and side streams in forestry, agriculture or food production that can be used as feedstock that don’t engender deforestation or biodiversity loss. And the resulting fibres are well known by the processing industry and have properties that make them suitable substitutes for cotton or synthetics in many applications.

Secondly, technological innovation and best farming practices still have a long way to improve quantity and sustainability of global cotton supply. The crazy yield differences of up to 10 times between the lowest and highest yield cotton farming countries must be closed as a matter of urgency. And if in this process farming economics improve, cotton can become a loved crop again for farmers who turned their back to it because they earn more with food, feed or bioenergy crops.

Other natural fibres such as hemp and wool or even nettle, flax and kapok also have potential in applications where their properties are desirable or for local and artisanal supply chains which if professionally organised, correctly incentivised and replicated extensively could add up to something on global scale and score particularly high on social and cultural dimensions of sustainability.

Making polyester, polyamide, polypropylene or acrylic fibres out of renewable bio feedstocks is another route that is worth expanding. Biogas, sugars or bio-oils if truly sustainably sourced can be a good option to gradually wean the man-made fibre industry off its fossil fuel reliance. The potential for drop-in of those bio-feedstocks into established processes at no or limited adaptation cost for existing plants, make this a very capital-efficient option.

Fibre-to-fibre recycling will have its role to play in the future too and industry and governments should invest heavily in research, innovation, pilot demonstrations and scale-up in the remainder of the 2020’s, but real volume impact is unlikely to result before the early 2030’s.

Further out there is the potential of fibre production from captured CO2 as feedstock. Not yet mature enough to be competitive at industrial scale, but with the long-term potential of making all the virgin synthetic fibres whose properties are needed for high durability and functionality that cannot be matched by biobased or recycled alternatives.

All this will be accelerated when the material customers in the fashion design departments smart up about true textile fibre sustainability, when sustainability managers get clear mandates to steer their brands towards more sustainable material supply even if this hurts the bottom line initially and if company boards see responsible raw material supply as integral part of a sound business strategy. In this sense the BCG report is a timely and welcome call to action.