India’s partially oriented yarn (POY) manufacturing industry has seen a significant drop in production, with factories now operating at about 20% of their capacity. This downturn is not due to a lack of demand, but rather a result of high inflation impacting the cost of essential petrochemical materials. Added to this challenge is the uncertainty in supply chains due to ongoing geopolitical tensions in West Asia.
In early March, the prices of key raw materials for POY production—purified terephthalic acid (PTA), monoethylene glycol (MEG), and paraxylene (PX)—surged dramatically. This sudden increase caught yarn manufacturers off guard, leaving them with little flexibility to adapt. The overall cost of these raw materials rose by an estimated 15% to 20% in just a month, reflecting an unprecedented rate of inflation for this sector.
