Sustainable Development | How Can the Textile Industry Adopt a Healthy Value Chain Operating Model?

Linear Development Model Faces Severe Challenges

Fashion brands have been striving to reduce their environmental impact, but data shows that achieving a circular economy still has a long way to go. According to the Circular Gap Report released by the global impact organization Circle Economy, fiber production reached a record high of 116 million metric tons in 2023, higher than the previous year's 112 million metric tons. Moreover, this number is expected to continue to increase in the future, as the global textile market is projected to grow by 7.4% annually before 2030.

Of the 3.25 billion metric tons of materials consumed by the textile industry each year, only 0.3% comes from recycled sources. Most of these secondary materials are derived from recycled PET bottles, rather than textile waste. 70% of the raw materials used in the textile industry are synthetic fibers made from fossil fuels.

The industry attributes this growth largely to fast fashion, with mass-market brands releasing up to 24 collections per year. It is also noted that luxury brands have increased production by launching mid-season collections in addition to the traditional two-season model.

Circle Economy found that when these garments are no longer used by consumers, 61.4% of them end up in landfills or incinerators, while 8% of discarded textiles are reused or exported. Over the past 30 years, the volume of second-hand clothing trade has increased nearly sevenfold.

01 Two Major Goals and Four Strategies

The circular economy has outlined two core goals to increase the circularity indicators of the textile industry (i.e., the proportion of material consumption from secondary materials). First, to minimize the extraction of natural resources and ensure that biomass production and extraction are renewable. Second, to minimize material waste while enhancing reusability.

Circle Economy states, “Typically, we measure circularity by looking at the materials flowing into the economy. In the case of the textile industry, we measure circularity by analyzing which materials flow through the global value chain and how they flow, allowing value chain participants to understand the current situation and providing a starting point for informed decision-making.”

The report proposes four strategies to achieve these goals: using less material (including fossil fuels) in textile production to reduce flows; extending the use time of textiles to slow down flows; replacing fossil fuels and other pollutants with cleaner alternatives to regenerate flows; and reusing textiles at the end-of-life stage to recycle flows.

"The Circular Gap Report is pioneering as the first in-depth analysis to measure the circularity of the textile industry, highlighting the urgent need to transform the entire textile value chain into a circular model of solutions," said Hilde van Duijn, Managing Director of the Circular Economy Foundation. “Only through concrete and scalable actions can the industry make a meaningful contribution to a sustainable future.”

02 “Tag Ur It” - Fashion Brands Behind the Textile Waste Crisis in Ghana

During the first round-up of major polluters from June last year to May this year (dubbed “Tag Ur It”), the non-profit organization The Or Foundation listed the 11 biggest polluters based on prevalence: Marks & Spencer, Next, Adidas, Nike, Gap and Primark (tied), George by Asda, F&F by Tesco, H&M, Boohoo, and Tu by Sainsbury.

Many of these brands have refuted the claims. Helena Helmersson, then CEO of H&M, stated in a Swedish talk show in 2023 that none of its products would be landfilled, but instead would be recycled or reused “where there is demand.”

Asda issued a statement saying it provides various recycling programs for customers, including setting up clothing banks at over 400 locations, establishing recycling bins at all click-and-collect sites, and through its grocery home delivery service, to minimize the risk of these clothes being discarded in landfills.

Boohoo declined to comment but provided information on its donation program with the British Heart Foundation, its partnership with the resale platform Thrift+, and its collaborations with Yellow Octopus and Robert's Recycling.

Adidas stated that it ensures all discarded clothing within the company is “properly disposed of” and is working with partners like Infinited Fiber Company to recycle textiles, such as launching a capsule collection in 2022 that contains at least 60% recycled cotton and 40% organic cotton.

Liz Ricketts, co-founder and executive director of The Or Foundation, emphasized the importance of disclosing production volumes. “If brands do not set upper limits on new production volumes or set reduction or alternative targets, they are not serious about their circular commitments; otherwise, they are pretending that circular and linear growth trajectories can be achieved simultaneously, which is not feasible.”

Ricketts added, “In my view, to establish a new economic model, brands must publicly disclose their current production volumes; otherwise, it means they are not seriously building infrastructure, partnerships, and trust.”

The lack of a standard conversion rate for clothing makes data parsing difficult. “From a policy perspective, we believe that EPR (Extended Producer Responsibility) fees should be ecologically adjusted based on production volumes. EPR is an increasingly popular regulatory tool that follows the principle of 'producer pays'."

03 Chinas Leadership in MMCF Field

As supply chain partners of leading brands, they are low-risk and have become leaders in this field.

In 2024, an assessment showed that the global man-made cellulosic fiber (MMCF) industry has made some “encouraging progress” overall. First, the report covered 97.5% of the global MMCF production (equivalent to 28 global innovators), with 71% of the rated producers receiving high ratings.

Canopy stated, “China once again demonstrated outstanding leadership in the MMCF field.” Tangshan Sanyou in Hebei Province, China, is the first company to rank first, with its viscose staple fiber made from 30% to 50% recycled dissolving pulp. “This product is the first MMCF containing post-consumer recycled textiles.”

Meanwhile, Chinese MMCF producers Yibin Grace and Xinxiang Chemical Fiber Co., Ltd. ranked second for expanding next-generation fiber solutions. Others worth mentioning include Jilin Chemical Fiber, Eastman, and Acegreen.

Lenzing Group has been a consistent contender or winner in popular reports for several years, scoring high in procurement, protection, and next-generation solutions.

The company launched the first lyocell fiber to the market, with 30% recycled pre-consumer waste cotton and 10% post-consumer waste cotton. Lenzing has established a large-scale partnership with Sodra Once More to produce up to 60,000 tons of the product, with 50% recycled cotton and 50% wood pulp.

Lenzing has also emphasized the importance of next-generation fiber solutions and signed an open letter to governments worldwide, calling for support for innovators in this field. As an industry leader, Lenzing opened a factory in Brazil to produce 100% FSC-certified dissolving pulp, which is a step above most factories that produce a mixture of FSC-certified and non-certified fibers.

Despite the efforts of MMCF advocates to promote new solutions that reduce dependence on virgin raw materials, Canopy states that the pressure on the world's forests is greater than ever.

The annual output of forest-derived fabrics is increasing, rather than slowing down. According to the disclosed figures to Canopy, MMCF production will surge by nearly 500,000 tons starting from 2023. The largest increase in output comes from Sateri, which currently accounts for nearly a quarter of the global MMCF production capacity.

Canopy wrote, “It is more important than ever that next-generation fiber solutions begin to significantly and accelerate the replacement of forest fibers in MMCF.