What Drives Cotton Prices Up?

The main reason is that global supply is decreasing, demand is expanding and natural is happening.

Cotton producers in major Asian countries and in the Near East have cut off the supply of global cotton, and cotton prices have risen to the highest level in 15 years, despite the growing demand for cotton products.

First of all, severe frost and bad weather occurred in China. China is the biggest cotton producing country and consumer country in the world. China's cotton is damaged, forcing China to expand its imports and make up for the demand gap.

Meanwhile, India, the world's second largest cotton producer, has restricted cotton exports after floods and bad weather in China, aiming to protect domestic supplies and control domestic market prices.

In addition, another big producer, Pakistan, suffered devastating floods, causing serious damage to cotton in Pakistan.

As global competition led to price declines, cotton production in the United States also declined year after year.

The demand for cotton fabrics in the middle class of China and other developing countries has been expanding, and cotton has suddenly become a hot selling commodity.

Cotton prices have risen by more than US $1 / pound over the past 40-50 cents / pound over the years.

Most American cotton exports to China are exported to the United States in the form of garments, sheets and bath towels.