Garment workers at a textile factory in India
Source: REUTERS/Samuel Rajkumar
Market Herald logo

Subscribe

Be the first with the news that moves the market
  • A spike in cotton prices is threatening Asian apparel makers, as higher costs put pressure on the industry
  • Benchmark cotton futures have hit eleven year highs over a lack of supply, as crop yields diminish in some of world’s largest producing countries
  • The world’s top cotton producer, India has seen cotton prices double in the last year, after rain damaged its harvest
  • Further adding to the pressure is the United States, with cotton crops in Texas under threat from excessive heat
  • However, the end of inflated prices is not in sight, with easing COVID-19 lockdowns in China expected to cause an uptick in demand, further exasperating prices.

A spike in cotton prices is threatening Asian apparel makers, as higher costs put pressure on the industry.

Benchmark cotton futures have hit eleven year highs over a lack of supply, as crop yields diminish in some of world’s largest producing countries.

India, the world’s top cotton producer, has seen cotton prices double in the last year, after rain damaged its harvest.

The country has been struggling to fulfil cotton orders over the last three months, with some calling for a ban on cotton exports.

Further adding to the pressure is the United States, with cotton crops in Texas under threat from excessive heat.

Some garment makers have made calls to switch to cheaper synthetic fabric as an alternative.

The industry has faced other higher costs, with freight and fuel prices on the climb over the fallout from the Russia Ukraine war.

However, the end of inflated prices is not in sight, with easing COVID-19 lockdowns in China expected to cause an uptick in demand, further exasperating prices.

More From The Market Herald

" ASIC sues Mercer Financial Advice for misleading customers

ASIC has sued Mercer Financial Advice for allegedly misleading customers about fees and services that were…

" Samsung Electronics Australia to pay $14m in penalties after misleading consumers

Samsung Electronics Australia has been ordered to pay $14 million in penalties after admitting it misled…

" ACCC ready to enforce new button battery laws

The ACCC has warned it will be cracking down on businesses compliance with the new button…

" WTO locks in global trade deals following charged talks

The World Trade Organisation (WTO) on Friday approved a series of major trade agreements after a…