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BANGKOK – Despite record earnings of $758 million for Indorama Ventures (IVL) in the second quarter 2022, the company’s Fibres business is currently experiencing significant market turbulence.

Combined PET (CPET), the largest of IVL’s three business segments, achieved earnings (EBITDA) of $431 million, up 35% year on year, while the Integrated Oxides and Derivatives (IOD) segment’s earnings were $250 million, up 98% on the same period of 2021

Sales for Indorama’s Fibres segment, however, fell by 15% year on year, and by 35% compared to the first quarter of 2022.

This segment consists of three vertical businesses – Lifestyle, Hygiene and Mobility.

The Lifestyle vertical was impacted by lower demand as a result of the China lockdown while higher freight rates restricted exports.

Meanwhile, the Hygiene vertical was impacted by disruption in spunmelt volumes at Avgol’s Russia site, along with higher polypropylene prices.

IVL’s Hygiene Division primarily serves the nonwovens markets for disposable absorbent hygiene products (AHPs) including baby and adult diapers, femcare articles and wipes and now consists of the following major fibre producers with global operations:

  • Auriga Polymers (headquartered in Spartanburg, South Carolina, acquired by IVL in 2011)
  • FiberVisions (Duluth, Georgia, acquired in 2012)
  • Indorama Asia (IVL’s proprietary polyester plants in China, India Indonesia, and Thailand)
  • Trevira (headquartered in Bobingen, Germany, acquired in 2017)
  • Wellman International (headquartered in Rosehill, Ireland, acquired in 2011)

IVL also entered the spunbond nonwovens business for AHPs by acquiring a 65% stake in Avgol in May 2018.

Avgol has six production sites globally in Israel, the USA, China and India, as well as Russia, with a combined production capacity of 203,000 tons per annum and employs 900 people worldwide. As a result, there are now IVL products in one out of every two of the 185 billion diapers produced every year,

The Hygiene business announced price increases of up to 15% on all of its fibres from December 1st 2021, or as contracts allowed, for polypropylene, polyester, recycled polyester, polylactic acid (PLA) and bicomponent fibres.

Unprecedented increases in energy, wages and domestic and international freight costs, as well as finishes, additives and all packaging materials, were cited as the cause for the price increases.

Strength in the replacement tyres market partially offset the ongoing semiconductor shortage, resulting in a stable performance for the Mobility vertical in the second quarter of 2022.

“IVL enjoys market leadership in each of our key business areas in industries that have stable long-term growth prospects,” said CEO DK Agarwal. “As we demonstrated through the peak pandemic period, our global platform’s unique attributes of resilience and growth means we can stay focused on our long-term plan while at the same time responding quickly to short-term market fluctuations such as the heightened energy costs and supply chain disruptions that have continued into 2022.”


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