Leading Austria-based man-made fiber manufacturer, Lenzing has no plans to expand its viscose fiber production capacity because of the challenging industry conditions. The company has been working to counteract the conditions through its cost optimization program launched early this year. Results achieved until now are encouraging but insufficient to offset the decline in viscose fiber prices in the international marketplace. 

Average fiber selling prices fell by 10.4 per cent in the first three quarters of 2014. Consolidated sales dropped 6.2 per cent and EBITDA was down 16 per cent over last year. Though Lenzing still anticipates good volume demand for man-made cellulosics, fiber selling prices on the global market are not expected to recover in coming quarters. 

This development is also attributed to the substantial decline in polyester fiber prices as a result of the massive oil price decrease, and the expected longer-lasting period of low or at least volatile cotton prices as a consequence of the surplus supply of Chinese cotton. As a result, Lenzing will not plan for any new expansion projects, which would have expanded its viscose fiber production. The restructuring measures will affect up to 250 jobs. The company completed a new Tencel fiber plant, which began production in July. 

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