Hyosung Chairman Cho Hyun-joon (Hyosung)
Hyosung is ramping up its investment in spandex in Brazil to capture rising demand for stretchable fiber used for comfortable clothing amid COVID-19 pandemic.
Hyosung is the world’s largest spandex manufacturer with its brand Creora, with a 32 percent market share.
Hyosung T&C, a fiber production unit of Hyosung Group, said Wednesday it would invest 40 billion won (about $36 million) by December next year to increase the production volume of its spandex plant by 10,000 metric tons in Santa Catarina, southern Brazil.
Upon completion of the expansion, the production capacity of the firm’s Santa Catarina plant will increase to a total of 22,000 tons.
The expansion comes as COVID-19 increased sales of comfortable clothing such as home wear and athleisure in the Latin American apparel market, which led to a surge in demand for stretchable fiber, the company said.
Tariffs in the Brazilian market are twice as high as in other regions, with the import tariff on spandex reaching 18 percent. This requires a local production base to maintain a competitive price, Hyosung said.
In addition, Brazil has borders with 10 of the other 12 countries in South America and is also in contact with the sea, making it advantageous for exports to nearby areas, the company said.
Hyosung T&C has strengthened its market dominance in the Americas after establishing a production base in Brazil in 2011 and is currently ranked first with a 65 percent market share in Brazil.
By Shin Ji-hye (firstname.lastname@example.org)