Raw materials are at the heart of so much of what happens in the apparel industry. And as a result the relative health, output and price of cotton is of particular concern for many. To supplement Sourcing Journal’s ongoing market data, this episode focuses on the dominant factors impacting cotton supply and demand, how the U.S. stacks up against other cotton growing nations and the advances taking place on the sustainability front.
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Jon Devine, Cotton Incorporated senior economist, details the “volatility and uncertainty” that may lie ahead as a result of a potential change in demand in China, weather related challenges elsewhere and the escalation of the trade war between the U.S. and China:
“It looks like there’s a lot of wait and see when it comes to tariffs. The Chinese government, as part of the back and forth on tariffs, did hit US cotton with an increase of 25 percentage points on July 6th but there are a few back doors that exist in terms of possibilities for US cotton still making its way into China. China does have free trade zones, which wouldn’t be hit by tariff increases, and China also has a category of cotton imports known as processing trade. Processing trade is fiber that comes into China that’s destined for eventual export in apparel or finished textile form.”
This podcast episode is made possible by Cotton Incorporated, a not-for-profit company funded by U.S. cotton producers and importers, and whose mission is to increase the demand and profitability of cotton. Discover What Cotton Can Do.