Zara owner Inditex, the world's largest clothing retailer, said its suppliers would buy 2,000 metric tons of a raw material made out of cotton textile waste by Swedish company Renewcell.
Renewcell is one of the world's first commercial-scale textile-to-textile recycling factories that helps clothing retailers replace virgin fibres with recycled textiles. It produces a textile pulp made from chemically recycled cotton waste, branded as Circulose.
Inditex, which like other fast-fashion retailers is under pressure to reduce waste and use recycled fabrics, earlier this week signed a deal to buy recycled polyester from a US-based startup. The Spanish company intends to source 25% of its fibres from "next generation" materials by 2030.
Inditex placed a total of 621,244 tons worth of articles on the market last year, according to its annual report.
"A public agreement to purchase any amount of fibers made with Circulose is positive in our view," Renewcell Chief Executive Magnus Hakansson told Reuters in an email.
"It signals to the rest of the market that Inditex is actively pursuing its goal to source and use more next-generation materials," he added.
Inditex said its suppliers would purchase the first order of a raw material made from a blend of Circulose and cellulose sourced from a sustainably managed forest, to be integrated into Inditex's collections.
Levi Strauss has already signed a deal with Renewcell to buy Circulose to make one of its blue jean pants, adding it to organic cotton.
Swedish retailer H&M also agreed in 2020 to use Circulose material across its brands over a five-year period, Renewcell says on its website.
Renewcell said earlier this month it had sold around 14,400 tons of Circulose as of the end of September.