Bloomberg reported a 30% increase in global cotton prices
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Extreme weather conditions led to a decrease in the cotton harvest in Brazil and the United States – the largest exporters of cotton, and the leader in its production, India, was forced to import this product, writes Bloomberg. As a result, cotton prices have risen by 30%, while cotton stocks continue to decline.
India is faced with the need to import cotton stocks due to heavy rains and pests, China is worried about the upcoming harvest amid intense heat, the agency writes.
The US and Brazil account for half of the world’s cotton exports. In the US, drought could see cotton production drop to its lowest level for the first time in more than 10 years. The second-largest exporter, Brazil, is also battling extreme heat and drought that have reduced crop yields by nearly 30%.
“This combination of extreme weather events caused by climate change has driven cotton prices up by as much as 30%,” the agency wrote.
About 200,000 metric tons of stock has dried up in Brazil, with production estimated at 2.6 million tons or less, according to Abrapa. Producer Bom Futuro reports a 27% drop in yield compared to the previous season.
Cotton prices are projected to rise even more in the coming months as the crop shrinks. Rising prices have already slashed the margins of clothing suppliers this year, which could push up the price of “everything from T-shirts to diapers to paper and cardboard,” the agency said.
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