Share of cotton in global fibre usage was estimated to be 36.5% during 2009. This trend is likely to decline in 2011-12 due to the unprecedented rise in the price of raw cotton. Soaring price of cotton is having its impact in all manufacturing destinations. What can be done to generate an acceptable equation among all participants of the textile and apparel chain?


Global garment industry has struggled with recession during the past two years. Now, the economy is getting out of the doldrums seeing a gradual recovery. Notwithstanding the same, market is in mayhem due to one or the other issues such as labor unrest, yarn prices etc. Latest addition to the issue list is the mounting prices of cotton. Garment makers are paying top dollar for purchasing raw cotton.


The calculus of cotton is very erratic without any clues of the future fluctuations. Garment exports have suffered serious drawbacks due to costs and the division that lies between the buying prices, and the instability of raw material costs. Fabric costs account for 60-70% of the apparel price. There is an unusual rise in the price of cotton since August 2010.

 

Cotton A Index price chart, 2000-2010