“A drought in China, floods in Pakistan and export controls in India are causing a global shortage of cotton. ..India,
the world’s second-largest exporter, restricted exports earlier this
year because of domestic scarcity. Exports are expected to resume next
month but only up to 5.5 million bales, about 18 percent of this year’s
estimated crop of 29.5 million bales. One bale is the equivalent of 228
kilograms…But the Indian textile industry, which employs 35
million people, wants an extended ban and higher taxes on exports
because there is not enough cotton to meet demand at home…Vinay Kotak is director of Kotak Ginning and Pressing in Mumbai, a cotton exporter. ..”Prices
are galloping and that’s why government is a bit in the mood to delay
the exports and that’s affecting business,” said Vinay Kotak, director
of Kotak Ginning and Pressing in Mumbai, a cotton exporter. “There’s an
acute shortage of ready goods in India from the beginning of the year.”..Cotton prices reached 15-year highs this week, above $1 for 453 grams. They have jumped more than 40 percent since July. ..China, a leading cotton producer, doubled its imports in the first eight months of the year, after drought damaged crops…This has left garment manufacturers in Asia bracing for higher costs…Nguyen Son is vice general-secretary of the Vietnam Textile and Garments Association…”The
cost increased. That’s why the Vietnamese garments and textile
manufacturers also face big problem in meeting the price requirement
from U.S. retailer and importer,” said Nguyen Son, vice
general-secretary of the Vietnam Textile and Garments Association…Kotak,
the company director in Mumbai, says he thinks any clothing price
increases may be more manageable in the growing economies of Asia than
in the West…”The end-use product price increase depends
ultimately on the purchasing power of the consumers. If the economies
are doing well in China, India or in Asia, there’s no problem. In Europe
and the USA, I have my own doubts whether manufacturers of garments
could pass on the price to the ultimate buyers,” said Kotak…Supply
may pick up in the coming months because of an expected rise in exports
from the U.S., the world’s leading exporter, Brazil and Australia. U.S.
cotton exports are expected to increase 29 percent from last year.
However, freight charges from those countries would add to Asian garment
makers’ costs…The U.S. Department of Agriculture says global
cotton consumption will outstrip stocks for the sixth straight year.
China, the world’s biggest consumer, is expected to ramp up imports by
16 percent this year. ”