cotton industry | News & Insights | Textile Industry

Cotton Trade Is Up 10% This Year but Shipping Problems Loom

Published: February 3, 2024

Author: TEXTILE VALUE CHAIN

FOR IMMEDIATE RELEASE

Date Posted: February 1, 2024

Washington, DC — Shipping problems are once again plaguing the cotton and textile industry, although not nearly to the degree the supply chain suffered through during the Covid pandemic. Finished goods will be affected more than raw cotton, making the situation particularly painful for merchants and mills.

Geopolitical unrest in the Red Sea area has driven shipping prices significantly higher in recent months, with trade routes between West Africa and Asia and between Europe and Asia being impacted the most. Other negative impacts include:

Longer delivery times due to the rerouting of ships could lead to order delays and cancellations.
Higher shipping costs will add to the already-high inflation.
Products will take longer to reach the markets — an especially big problem for seasonal textiles and apparel.
If high shipping costs spread to other regions, the entire cotton trade will be affected.

There are two silver linings in this dark cloud, however:

The cotton and textile industry has experience in overcoming logistical problems, as it did during Covid and the blockage of the Suez Canal.
Despite the challenges, global cotton trade is up more than 10% over last season.

Price Projections
The Secretariat’s current price forecast of the season-average A index for 2023/24 ranges from 81.02 cents to 103.61 cents, with a midpoint at 90.88 cents per pound.For the most up-to-date statistics, please refer to the Data Dashboard. It is updated with new data constantly and that new information is immediately reflected in the Dashboard, making it a valuable, up-to-date resource all month long. You can view a video tutorial on how to use the ICAC Data Dashboard on the ICAC’s YouTube page here.

Please note that the cotton balance sheets have been moved to the ICAC Data Dashboard. This ensures that the season balance sheets are always up-to-date and available whenever you need them. This also helps to reduce errors because the data is compiled directly from our database. We have included them in this PDF report, but we strongly encourage you to obtain all data from the Dashboard.

If you are a subscriber to Cotton This Month, please access your account with your user name and password here. To subscribe to Cotton This Month, please click here.

Please contact the author, ICAC Data Scientist Matthew Looney, with questions on this report.

The next Cotton This Month will be released on March 1, 2024.

About the International Cotton Advisory Committee (ICAC)

Formed in 1939, the ICAC is an association of cotton producing, consuming and trading countries. It acts as a catalyst for change by helping Member governments maintain a healthy world cotton economy; provides transparency to the world cotton market by serving as a clearinghouse for technical information on cotton production; and serves as a forum for discussing cotton issues of international significance. In addition, Members can take advantage of the ICAC’s global network of cotton researchers, whose expertise covers the supply chain from farm to textile manufacturing, and have free access to its cutting-edge technologies like the voice-based app and virtual technology cotton training program. Committed to ensuring cotton’s continued sustainability, the ICAC is the only intergovernmental commodity body covering cotton that is recognized by the United Nations.