There seems to be no end in sight of the current deterioration in the price of cotton. According to media reports, the prices have been falling since May due to the oversupply in the USA, the third largest cotton producer in the world. Whereas a pound of cotton still cost around 0.90 US Dollars (approx. 0.76 Euros) three months ago, the current price is 0.64 US Dollars (approx. 0.49 Euros). That corresponds to a price decline of around 30% and is only nine Cents more than the last all-time low five years ago.
Because the harvest forecasts for this year are very optimistic and the production in the biggest US cultivation state Texas is due to increase again thanks to the favourable weather conditions, a continuation of the price decline is anticipated, experts are reckoning with an all-time low of 0.50 US Dollars/pound. At the same time, the decline in demand for cotton is having an further effect on the price deterioration: Particularly China, the biggest cotton importer in the world, is importing less cotton because the warehouses are full. Poor economic forecasts are further stifling the consumers’ demand for textiles.