Future of cotton

Future of cotton

Future of cotton and textile sales in the world

Prices of cotton have kept on the same range since October, 2015 with stocks at high levels, which will continue influencing on prices. However, it is the first time in 5 years that the worldwide production will not cover the total demand, which will decrease the total stock slightly, but the total demand of production for this fiber is not high enough to affect the price.

The main producer of cotton nowadays is India, and worldwide, cotton represents only a third part of the textile that is consumed. In Europe, synthetic fibers are still representing a 4% total of the textile consumption.

“Cotton is the main fiber to produce denim, which is used to manufacture garments which are more popular each day, the low price of cotton can be helpful to offer more competitive prices to our customers”, said Salomon Juan Marcos Villarreal, president of Grupo Denim, an enterprise dedicated to manufacture garments mainly made of denim.

The demands of the emerging economies in Asia is still strong, but the growth rate is diminishing significantly, plus some tensions on the Chinese market, such as the falling on competitiveness of cotton costs are causing a regrowth of business risks on this sector. On the more developed economies, the Europeans are slowly going back to buy confection, while that in North America, this sector is growing up significantly.

In North America, the cotton production is the third more important in the world, and it is actually facing a deceleration to the Chinese demand linked to the importation restrictions. United States used to be one of the main providers for China.

In Canada, the sectorial risk needs to be watched, the slowdown of energetic investments is affecting the economy and the increasing rate of unemployment is starting to cause tensions on the household incomes, which might mean reducing the amount of money destined to clothes expenses.

“There are different factors that are causing a deceleration on the demand of textiles, and clothes; however, this is nothing more than a batch as many more we had seen or will have to go through in the future on this industry”, added Salomon Juan Marcos Villarreal.