Cotton prices affect clothing prices or rise again

The cotton price that cooled after the end of the policy regulation at the end of 2010 has once again warmed up. “The cotton ** has risen in contrarian conditions recently, the international cotton ** has risen for three consecutive days, and domestic cotton ** has re-entered an important juncture of 30,000 yuan/ton.” Personages predict that the trend of cotton prices running at a high level will continue after the Spring Festival. In 2011, the price of clothing is bound to rise.

Although cotton prices have been steadily declining under the control in the second half of 2010, in the end-sales segment, apparel prices have continued to soar. According to the annual reports of listed companies of apparel, the ex-factory price of garments has generally been raised, ranging from 10% to 20%, due to the rising costs of raw materials and labor. Although the current price of cotton has fallen from its high level in 2010, due to the expected increase in the price of cotton, the price of clothing in 2011 is still “uplifted”.

Concerns over market supply and the recent weakening of the US dollar once again boosted the rebound in the cotton futures market. Although with the Spring Festival holiday approaching, the domestic cotton spinning and weaving companies have gradually increased the number of suspensions and holidays, and there is no possibility that there will be a continuous rise before the holiday, but the long-term bullish trend of cotton prices is unchanged. Industry sources said that under the combined forces of multiple peripheral factors, the trend of cotton prices has become a consensus.

“The fall and winter price of 2010 is generally higher than 10%.” Insiders pointed out that most of the brands with market foundation can pass the pressure of rising raw materials through price increase, new product strategy and so on. However, in the event that price changes are still unable to keep up with the increase in costs, the industrial upgrading of textile and garment companies is imminent. “The volatility in cotton prices has made many small and medium-sized textile companies realize that it is necessary to increase the technological content and added value of products.”