Posts tagged ‘Cotton’
Alexandra Wexler reports today that “despite heavy purchases, China still needs millions of tons of cotton to feed its mills”, “traders are positioning themselves for a rise in cotton prices.” For the full article, click here.
Just when it seemed as if the price of cotton was heading down and clothing retailers could get back to the important business of style rather than the tedious business of product costs, India goes and drops the hammer on the cotton market. On Monday, the Indian government announced that it will immediately and indefinitely ban all cotton exports, including shipments that had already been scheduled but not yet shipped.
Not this again
Around this time last year, clothing retailers were struggling to survive after the price of cotton had nearly tripled in just one year. Despite a long drought in Texas, where much of the United States’ cotton is grown, prices fell by more than 50% throughout the year. The United States is the world’s biggest cotton exporter, but the trouble here was outweighed by what is projected to be a record harvest in Australia and softening global demand. To read the full story click here.
(Reuters) – India banned cotton exports with immediate effect on Monday to ensure supplies for domestic mills, boosting global prices some 4.5 percent as the absence of shipments from the world’s second-largest producer might tighten a market facing weak demand. Read the full story here.
Cotton futures jumped to a two month-high on speculation that better-than-expected economic data in China, the U.S. and Germany signals higher demand for raw materials. Orange juice dropped.
Global equities rallied after gross domestic product in China, the world’s second-largest economy, grew 8.9 percent in the fourth quarter, above the median in a Bloomberg News survey. A U.S. Federal Reserve report showed manufacturing in the New York region increased at the fastest pace in nine months, and German investor confidence rose by a record. To read the rest of the story click here.
With so much talk about the soaring costs of cotton these days, we thought we’d offer a fresh perspective from the other side.
Due to undesirable weather conditions including flooding, cold snaps and hailstorms, cotton crops are coming up short this year and with the world’s demand of cotton so high, prices have been skyrocketing – rising almost 80% since July. With global apparel prices stagnant for some time now, apparel manufacturers and exporters are being hit hard. Companies like Jockey, Liz Claiborne, Levi’s and Hanes are in search of a solution so as not to have to pass this price hike onto consumers.
While some are in search of cheaper cotton sources in Banglasdesh and Vietnam, others are attempting to find alterntive cost effective yarns to blend into their cotton garments. You’d be surprised at the increase of emails we’ve received lately from spinners, knitters and manufacturers from around the world, enquiring about the availability and pricing of our CRAiLAR® fibres.
Both Levi’s and Hanes have stated that they will be integrating new materials into their products in order to lower costs, Bon-Ton chain is switching from 100 percent cotton in items like sweaters to more acrylic blends. Liz Claiborne, which makes brands like Juicy Couture and Kate Spade, is also playing with some of the materials it uses. One example, said spokeswoman Jane Randel, would be shifting from some imported Italian fabrics to “suppliers who produce their own raw materials or yarns”.
Ms. Johnson, an analyst with First Capital Group, stated that “We may be training a new generation to be far more accepting of synthetic fibers, which is likely to hurt cotton’s market share in the long run.”
We believe that companies can blend their way out of the cotton dilemma. However, with the higher demand from manufacturers switching away from cotton mixed with the anticipated rise in oil costs, the price of polyester and other synthetic fibres continue to rise – nearly 25% this past year. So, are synthetic fibres the solution?
We believe that CRAiLAR® Organic Fibres are the foundation of the first truly sustainable yarn in the apparel industry, and are poised to become the revolutionary next step in sustainable fibres, providing an economically sustainable complement to cotton.
Created using bast fibres such as flax, hemp, jute and kenaf, the yarns made from CRAiLAR® Organic Fibres can be used in knit, woven or nonwoven fabrics, alone, or blended with other natural fibers. CRAiLAR® can be used in both mainstream and alternative apparel and fashion fabrics, as well as industrial textiles. Through spinning trials, CRAiLAR® Flax was found to be of very high quality and ideally suited for fine knit items such as T-shirts.
With cotton prices currently well over a dollar per pound, flax is a cost-effective raw material for fibre production. We estimate that we will be able to provide CRAiLAR® Flax at approximately $0.90 per pound making it an econimically viable complement to cotton.
Not long ago Wal-Mart announced their global commitment to sustainable agriculture in which they aimed to help small and medium sized farmers expand their businesses, get more income for their product and reduce the environmental impact of farming. Wal-Mart pledged to make it’s Faded Glory brand 100% more sustainable. Now, just a few months later, reports from India indicate that the retail giant may be cutting back on it’s use of organic cotton.
Anil Jain of Venus Garments stated, “We had a considerable good order for organic garments from Wal-Mart last year which is has not continued for this year.” Although sizeable orders continue to come in from Wal-Mart, it’s Spring 2011 line is made up of a mixture of both conventional and organic cotton as opposed to 100% organic cotton.
According to one advisor at Ecotextile News, the most likely reason behind Wal-Marts decision to cut back on their sustainability commitments has something to do with the record high costs of cotton. Five years ago, organic cotton was selling 20 – 25 cents per pound more than conventional cotton, whereas today organic cotton is 5 – 7 cents more per pound.
Some industry leaders have suggested that any cut backs by Wal-Mart may last only a short while until the prices return to reasonable rates. Either way, downsizing of Wal-Marts organic cotton commitment will be a disappointing blow to Indian organic cotton farmers.