CHINA'S TEXTILE SECTOR FALLS VICTIM TO COTTON AND POLYESTER SHORTAGES

CHINA'S TEXTILE SECTOR FALLS VICTIM TO COTTON AND POLYESTER SHORTAGES

China's vital textile sector, already struggling with higher costs and shortages of cotton, is facing another crisis in its attempt to use more man- made materials.

An acute shortage of polyester is slashing output at several of the country's main production centers, said officials who requested anonymity.About half the country's polyester producers had halted production by the middle of June, they said.

In Shanghai, 20 of the city's 100 producers have ceased production. Between 50 percent and 80 percent of plants in eastern Zhejiang province are also idle, the officials said.

Southern Guangdong province, the powerhouse adjacent to Hong Kong, reports half its polyester producers have ceased working.

All producers in Beijing are said to have stopped. The numbers weren't immediately available, but the capital is not a big textile producer. Other plants in Tianjin, Hebei, Shandong and Guizhou province also are reported to be idle.

Garments and textiles are China's chief money-spinner, earning $30 billion last year, a goodly part of it from U.S. buyers.

As cotton, the staple for decades, has become scarce and expensive, the China National Textile Council decreed a shift to other fibers.

China is projected to produce 1.4 million metric tons of polyester chips and 700,000 tons of purified terephthalic acid, a raw material in polyester production, this year. Those figures would be short of demand by 300,000 tons and 360,000 tons respectively.

New installations expected to begin working in the next few years indicate the country will be capable of producing 2.3 million tons of polyester in 1996.

PTA capacity will be only 1.5 million tons by the end of this year, however. A development plan calls for new plants boosting PTA capacity to 2.25 million tons by the year 2000.

More plants are coming into service to help meet the burgeoning demand.

Guangzhou Asian American Polyester Co. in Guangdong began operation last

December using $70.78 million in investment from China, the United States and Japan. The company introduced advanced technology and computerized equipment

from E.I. du Pont de Nemours & Co. of Wilmington, Del.

By midyear, it had produced 18,000 tons of polyester and expects to surpass its designed annual production capacity of 60,000 tons.

Robert Dillon, general manager of the company, said the partners have decided to begin the second phase of the plant, which will produce 80,000 tons of polyester a year.

BASF AG of Germany recently signed an agreement to set up a joint venture producing and marketing polyamide carpet yarn and polyester chips in Shanghai.

Construction of the plant is scheduled to start at the end of this year and be complete in 1997. Capacity is rated at 40,000 tons of carpet yarn and 50,000 tons of polyester chips a year.

China is forecast to consume some 7.8 million tons of chemical fiber in 1995, including 750,000 tons of polyester staple for the cotton sector and 50,000 tons for wool spinning.

The country will need 100,000 tons of polyester staple for linen fabrics and 70,000 tons of viscose filament, 200,000 tons of polyester filament and 40,000 tons of polyamide filament for silk processing.

A further 500,000 tons of polyester filament and 60,000 tons of polyamide filament as well as 30,000 tons of polypropylene filament will be demanded by knitwear producers.