Fibertex Personal Care Adjusts Malaysian Spunmelt Output Amid Growing Market Competition

Operational Adjustments and Financial Impact

Fibertex Personal Care, a subsidiary of Denmark-based Schouw & Co., recently announced a restructuring of its Malaysian operations. The company has implemented strategic changes to enhance operational efficiency, resulting in a one-time charge of DKK 15 million ($2.2 million) due to costs associated with workforce reductions and process optimization.

In its third-quarter earnings report for 2024, Schouw & Co. revealed that FPC’s earnings dropped from DKK 81 million ($11 million) in Q3 2023 to DKK 40 million ($5 million) in Q3 2024, despite stable sales of DKK 474 million ($70 million). This decline in profitability is largely attributed to operational adjustments and increasing market competition in the baby diaper and sanitary pad segments.

The Malaysian Market and Competitive Landscape

Since entering the Malaysian market in 2003, FPC has steadily expanded its presence, adding a second production line in 2017. Today, the company operates six production lines across two plants near Kuala Lumpur. Malaysia has become a crucial hub for nonwovens manufacturing due to its strategic location, cost-efficient workforce, and strong regional demand for hygiene products, particularly baby diapers and sanitary pads.

However, with several manufacturers expanding their production capacities, competition in the Malaysian nonwovens market has intensified. New players and existing industry giants are vying for market share, creating a challenging business environment where pricing pressure and operational efficiency play critical roles in sustaining profitability. The demand for high-quality nonwoven materials used in baby diapers and sanitary pads has led to a surge in investment in advanced production technologies.

Focus on Value-Added Products and Market Positioning

Despite temporary reductions in production output, FPC remains committed to delivering high-quality, value-added nonwoven materials tailored for competitive and price-sensitive markets. The company has emphasized its focus on innovation, sustainability, and premium product offerings, particularly for hygiene applications such as sanitary pads and baby diapers.

Nonwoven materials are essential components in hygiene products due to their softness, absorbency, and breathability. The demand for advanced materials in disposable hygiene products continues to grow as consumers seek improved comfort and performance. FPC aims to differentiate itself by offering nonwovens with superior liquid management properties, skin-friendliness, and eco-friendly attributes. As the baby diaper and sanitary pad industries grow, FPC is strategically positioning itself to cater to the evolving needs of both markets.

Rising Demand for Sanitary Pads and Baby Diapers in Asia

Growth of the Baby Diaper Market

Asia represents one of the fastest-growing markets for baby diapers, driven by rising birth rates in emerging economies, increasing urbanization, and improved living standards. Countries such as China, India, Indonesia, and Malaysia are witnessing a surge in demand for high-quality disposable diapers due to increased disposable income and changing consumer preferences.

Parents today seek baby diapers that provide superior absorbency, leak protection, and skin-friendliness. Manufacturers have responded by developing ultra-soft, breathable, and hypoallergenic nonwoven materials. FPC’s commitment to R&D ensures that its spunmelt nonwovens meet the stringent requirements of premium baby diapers, reinforcing its position as a key supplier to leading hygiene brands. The expansion of baby diaper production has also influenced raw material sourcing and supply chain dynamics, further shaping the industry’s competitive landscape.

Expanding Sanitary Pad Market

Similarly, the market for sanitary pads in Asia is witnessing robust growth, driven by increasing awareness of menstrual hygiene, government initiatives promoting feminine hygiene products, and a growing middle-class population. The adoption of disposable sanitary pads has risen significantly in rural and urban areas alike, fueling demand for high-performance nonwoven materials.

Modern sanitary pads require nonwovens that offer softness, high absorbency, odor control, and enhanced breathability. FPC’s advanced nonwoven fabrics help manufacturers produce sanitary pads that provide comfort and reliable protection, addressing the evolving needs of female consumers. The rising demand for sanitary pads has encouraged innovation in biodegradable and organic materials, as manufacturers explore sustainable alternatives to traditional products.

Sustainability and Environmental Considerations

With increasing global focus on sustainability, the hygiene industry is under pressure to develop eco-friendly products. Consumers are becoming more conscious of the environmental impact of disposable hygiene products, leading to a growing preference for biodegradable and recyclable materials. The baby diaper and sanitary pad markets are at the forefront of this shift, with manufacturers prioritizing sustainability in both materials and production processes.

FPC has actively invested in sustainable manufacturing practices, including energy-efficient production processes, reduced waste generation, and the development of eco-friendly nonwovens. The company collaborates with customers to create baby diapers and sanitary pads that incorporate biodegradable fibers and recyclable packaging, aligning with the industry’s shift towards greener solutions. As governments and regulatory bodies impose stricter environmental policies, FPC continues to lead in sustainable hygiene product innovation.

Future Outlook and Strategic Goals

FPC’s strategic realignment in Malaysia is a response to short-term market challenges, but the company remains optimistic about long-term growth prospects. With demand for nonwovens in baby diapers and sanitary pads projected to rise, the company aims to capitalize on opportunities by:

1. Enhancing Product Innovation – Developing advanced nonwovens that offer improved absorbency, comfort, and sustainability for hygiene applications, including baby diapers and sanitary pads.

2. Strengthening Regional Presence – Expanding its footprint in high-growth Asian markets through partnerships with key hygiene product manufacturers in the baby diaper and sanitary pad sectors.

3. Optimizing Production Efficiency – Streamlining operations to reduce costs while maintaining high-quality output for baby diapers and sanitary pads.

4. Investing in Sustainable Solutions – Increasing research into eco-friendly materials to meet evolving consumer expectations and regulatory requirements, particularly in baby diaper and sanitary pad production.

Conclusion

Fibertex Personal Care’s adjustments in Malaysian operations reflect the evolving landscape of the nonwovens industry in Asia. While challenges persist, the company’s focus on value-added products, sustainability, and operational efficiency positions it well for future success. As demand for baby diapers and sanitary pads continues to grow, FPC’s strategic initiatives will play a crucial role in reinforcing its leadership in the global hygiene market.