AN Northern Ireland's historic linen industry survive in the face of fluctuating demand, rising raw material prices and increasing competition from the Far East?

These factors were blamed by Mr Tom Andrews for the failure of his family owned firm, John Andrews & Company. Until its closure earlier this month, the company had produced wet spun flax and linen yarn at its Comber mill for 133 years.

Union representative Mr Albert Mills, of the Transport and General Workers' Union, said that the closure was "another nail in the coffin of the Northern Ireland linen industry". Mr Mills blamed lack of investment, and inactivity on the part of the government, which, he said, was doing nothing to protect indigenous industry.

But Ms Linda McHugh, the marketing executive of the Irish Linen Guild, believes that the linen industry will survive. She points out that Andrews was the smallest linen yarn producer in Northern Ireland, with only a 6 per cent share of total production.

"Northern Ireland has a 21 per cent share of the European sales of linen yarn," she says, "making it the second largest producer in Europe. The closure of John Andrews & Company is regrettable, but it should not be seen as spelling the end of the local linen industry."

Mr Lawson McDonald, of the IDB, agrees. But he says it is a sector in which demand is never easy to predict. "The linen spinning industry in western Europe is subject to changes in fashion," he said, "and Northern Ireland companies have experienced particularly severe fluctuations in demand in recent years."

The biggest yarn producer in Northern Ireland is Herdmans, which is based at Sion Mills, Co Tyrone, and employs 650 people. It recently bought Killyleagh Yarns in Co Down, only a dozen miles from Comber, and is creating 30 jobs there as part of an initial expansion programme.

In spite of suffering periodically from downturns in demand, resulting in lay offs and short time working, Herdmans has succeeded in managing the cyclical nature of the business by a strategy of continuous investment in new plant and machinery, an achievement that was recognised earlier this year when the firm was named Northern Ireland Exporter of the Year.

Another yarn spinner, the Belfast based William Ross, which employs 75 people, has also shown that it is possible to survive and prosper in a volatile market, and following major investment over the past two years, has won a reputation as the most advanced dry spinning company in the world.

But Linda McHugh insists that the future of the Northern Ireland linen industry rests not just with the yarn spinners, but also on the strength of its weavers and fabric finishers.

"Northern Ireland has a true vertical industry," she says, "which makes it unique amongst its competitors. This has been particularly important in developing a partnership approach to dealing with the larger customers, who want to know everything about the fabric they are buying, from how the yarn is produced to the way in which the fabric is dyed and finished."

The main companies in this sector of the business are Ulster Weavers, Moygashel, and Baird McNutt, all of which have set up sales offices in New York to service the American market, which is by far the most important for apparel fabrics.

Sales at Ulster Weavers, one of whose most successful product lines is Irish linen tea towels, increased by 50 per cent last year. But the 200 year old Co Tyrone company, Moygashel, has found life more difficult. Around 75 per cent of its output is for the notoriously fickle apparel market, and sales last year fell by over £6 million to £21 million.

The main reason was the decline in demand in the United States, where sales were down by £8 million compared to the previous year, although this was partly offset by increases in Britain and in other European markets.

Around one third of the linen produced in Northern Ireland is for the household textiles and interior furnishings market.

Even in the volatile world of fashion, Ms McHugh believes that the trend will move back towards natural fibres.

"We have an industry which has a worldwide reputation for the quality of its product," she says. "That, and the quality of service we can offer, will make sure our major customers keep coming back. Predicting demand in the fashion business is always difficult, but if the major Northern Ireland companies maintain a high level of investment, we will be ready when the trend swings back towards natural fibre."