Challenges of Cotton Industry
Cotton prices began rising in year 2010 due to increased demand and weather-related crop shortages globally. In addition to that India’s actions to restrict cotton fibre and yarn exports helped accelerate the spike in prices which still has its effect in year 2012. Relocation of the production facilities has created an additional level of complexity for the sustainable textile production. At the same time complexity of cotton supply chain is growing constantly in many producing countries. According to the Reuters, the NY cotton prices rose last week to post an 8% jump in August, notching their biggest monthly gain in a year and a half, as speculative investors bet that torrid weather conditions would hamper global output and help to eat into record stockpiles. The European chemical regulation which involves registration, evaluation, and authorisation is a complex and costly effort that tends to create competitive disadvantages for many globally.
Rapidly rising prices of cotton and domestic demand in China is also leading apparel importers to take a fresh look at the issues in the west. Cotton industry in U.S is benefiting from this because the sourcing is now imbalanced which initiates emphasise on regional production. More and more textile fairs are being organised in U.S to showcase local textile industry and ever-changing product offerings available from U.S manufacturers. Working with textile supply chains, U.S would now promote the growing infrastructure, capabilities and value of sourcing from America. At the same time U.S textile industry faces new challenges of rapid rising cost of raw materials. Another host issue is that NCTO is strongly opposing the United States and Korean free trade agreement because of its inequitable terms for textiles.
The massive surge in the price of cotton fibre has strengthened the demand for artificial fibres, particularly the staple polyester. During the global economic recession, capacity was idled and some new planned capacity was delayed. Meanwhile, companies throughout the supply chain drained inventory. As the both natural and artificial fibre producers and consumers are interconnected, textile industry throughout the world has been working hard to meet demand. Every industry faces challenges but holding optimism would help more than calling it risky at this stage because cotton textiles is part of our life just like food we eat every day.