An update on cotton price


An ancient fibre, cotton is renowned for its adaptability, inherent comfort, and performance. Since before the advent of Christianity, cotton has been weaved with unrivaled craftsmanship, earning it renown around the world.

Importance of cotton in the garments industry

Cotton is an important asset for the garments industry. Basically, the invention of cotton started the idea of clothes and hence the idea of the garment industry.

The characteristics of cotton made it an excellent candidate for widespread worldwide use. Salts, acids, and fats are among the substances that the material may absorb. Even while absorbing 20% of its weight in water, it seems dry, and it only leaks when it is more than 65% saturated.

Cotton is so simple to wash because its fibres are much more tear-resistant while wet than when dry. Items made of white or colorfast cotton may be boiled and heated iron, which are qualities that are crucial for cleanliness. Cotton is fairly breathable while not being a great heat-insulator. It is pleasant to wear, and gentle to the touch.

Cotton is mostly used to create woven and knitted textiles. Depending on the uses, cotton textiles are afterward employed in a variety of ways. The following is a list of uses for cotton fibres in the garment industry:

  1. Cotton yarns are made by using this. Cotton yarns are then utilised to make various apparel items and textiles. When sewing clothing, cotton threads are utilised. Cotton fibres may be found in a broad variety of textiles.
  2. All types of garments from jacket to t-shirt, sportswear, activewear, yoga wear, cotton t-shirts, which are always in high demand, are also made of cotton fibres.
  3. Used to create denim products.
  4. Cotton sarees are very famous in our country. Also the famous Khadi and khadi items are mainly made of cotton.
  5. Cotton may not be primary in this case but it is also used in making fabrics like muslin.
  6. Used in making ropes and thick yarns.
  7. In order to make the apparel that accounts for 60% of all cotton usage, cotton is generally turned into yarn and thread.
  8. The stylish face masks we use are also made of cotton.
  9. Used in making cloth bags, seed bags and used as packaging material.
  10. Bed sheets, curtains and other made ups are made of cotton.

Cotton is widely used in every angle of our lives. Due to rising wages in industrialized nations, the majority of cotton consumption has transferred to emerging nations. As a result of rising labor costs, emerging nations like China and Asia, who have a plentiful supply of labor, are now processing cotton instead of the developed ones, which has reduced or even eradicated their rivalry.

The pricing of cotton nowadays

In the aftermath of the Russia-Ukraine conflict, an unusual increase in freight costs, and the US drought, cotton prices soared to levels not seen in more than a generation. As a result, readymade garment (RMG) manufacturers in Bangladesh would see their revenue suffer.

According to media sources, cotton output has decreased as a result of the drought in Florida, US, and the abundant rain in India, and as a result, cotton prices have increased by as much as two times in some nations over the course of a year.

In March 2022, it was seen that the price of the plant fibre had reached 1.3171$ for every pound or about 453 grams and it was the highest since July 2011. Because of the pandemic, the economy was devastated so the moment the lockdown was up, the cost of the key textile raw material rose in the international market to the rising demand.

Bangladesh is completely reliant on imported cotton to support its primary export-generating industry, therefore when cotton prices soared on the global market, the cost of manufacturing for garment makers and exporters will increase. The rise in cotton prices will be heavy on Bangladesh.

According to importers and millers, cotton prices would increase more if the war continued. In the end, this will boost the production costs for clothing manufacturing by increasing the price of yarn in the local marketplaces.

The exporters will be in a tough position as a result because even while their costs of production may increase fast, they might not be able to increase their pricing with their foreign customers because the procedure includes extensive bargaining.

Experts have already predicted that the cotton price will also rise locally because it is the main raw material for yarn production. Even though Bangladesh has its own cotton farm, it’s not enough for the huge production of garments. Including the war and outrageous hike in shipping costs, China’s large-scale cotton purchases from foreign markets, the US drought, and speculation are partly to blame for the cotton price increase.

But the good news is recently the cotton price is declining as the demand has slowed down a bit. According to importers, from the end of June, the cost of cotton has decreased by $0.30 to $0.35 per pound during the past three weeks. In the next few days, it might decline much more.

The price is anticipated to decrease as the cotton harvest season approaches since there is no chance of significant production losses. The cost of cotton is anticipated to decline to a manageable level, according to importers. The country’s primary export industry, the clothing industry, has benefited from the ongoing decline in cotton prices. Nevertheless, the nation’s textile spinning mills now have to sell every kg of yarn at a cheaper price of $0.70 in a matter of just two months.

The experts said that cotton prices have grown abnormally during the last year, owing mostly to increased demand. The demand for cotton is currently declining, along with the demand for clothing. Cotton is becoming less expensive as a result. Experts also said that Globally, and particularly in the US and EU, there is rising inflation, which has led to people buying fewer garments. Because of this, customers are placing fewer orders.

Cotton is very essential in the Bangladesh economy considering a huge chunk of money comes from the garments industry. If the cotton price rises, it affects our economy greatly. It’s great news that the price is declining slowly.