COTTON FIBRE The most noticeable factor throughout
2003 has been the continued increase in the cost of raw cotton
fibre, and subsequently cotton yarn and fabric. In October
2001 Cotton Outlook reported a Cotton 'A'
index of 34.95 cents/lb. For January 2004 the rate was 75.90
cents/lb, a rise of 117% in little over two years.
CURRENCY CONVERSION As most textiles raw materials are
bought internationally in US Dollars, currency movements have
a a strong impact on yarn and fabric prices. There has been
a significant weakening of the dollar.
(12/01/04 - £=$1.85 from $1.59 at the start of 2003.)
The Euro has risen from $1.03 to $1.28 in the same period.
While this is good news in terms of raw materials costs, it
presents a major problem for manufacturers hoping to export
to the USA.
Source: Yahoo Finance
CHINA A major feature of textile markets
in 2003 is the continued emergence of China as a manufacturing
country. Very few markets have been unaffected by the massive
volume of goods produced and exported from China. The importation of cotton fibre
into China to support the manufacturing was a major factor
in forcing up the price of cotton fibre.
The GATT agreement to remove textile quotas at the end of
2004 is likely to enable further inroads for Chinese exports
into Western textile markets.
