Wednesday, June 18, 2025
spot_img
spot_img
HomeTechnical ArticlesKnow HowExcess supply and prolonging trade war with China is affecting the cotton market

Excess supply and prolonging trade war with China is affecting the cotton market

spot_img

Seshadri Ramkumar, Texas Tech University, USA

Productive, albeit stressful conversations, occurred today at the Lubbock-based Plains Cotton Grower (PCG), Inc., about the current trade situation with China, which is impacting the production agriculture in the United States. More importantly, discussions on how the cotton market with excess supply is being affected with China not being a player due to the prolonged trade dispute between the United States and China occupied the center stage. With the cost of inputs rising, increase in production coupled with slow demand, cotton farmers are starting to think about alternate strategies. Producers vocally expressed frustration with the dispute lingering so long without an end in sight.

“Tariffs are good for no one,” stated Darren Hudson, professor of agricultural economics at Texas Tech University. Supply is relatively high compared to demand, added Hudson. Farmers who gathered agreed that the trade issue with China primarily centered around intellectual property rights has been going on for over 2 decades, and therefore finding a resolution is complicated. A solution to the dispute is in the interest of agribusiness, particularly cotton, as China is a major importer of U.S. cotton.

Availability of financial resources in these tough times is critical. Market planning and getting   control over costs of inputs and operational costs are some of the strategies that need greater attention. “This emphasizes the need for savvy business calculations and cost-effective practices stressed,“ Steve Verett, executive vice president of PCG and a well-respected leader in the cotton industry. With the expectation that there will be increased cotton acreage in the United States in 2019, the supply-demand situation is going to play a pivotal role in the cotton sector this year.

Currently, China and Turkey are not active buyers, stated one cotton merchant. Although there is demand for good grade at 70 cents, low grade cotton prices linger around 65 cents. The cotton price and demand situations are being seriously watched as producers have started preparing the land for this year’s cotton planting in West Texas.

YOU MAY ALSO LIKE

LEAVE A REPLY

Please enter your comment!
Please enter your name here

spot_img

Join Our Weekly Newsletter

- Advertisement - spot_img

Upcoming Events

 

Simillar News

Recent Random

Warm Felicitations from BKMEA to the Newly Elected BGMEA Board

On behalf of BKMEA President Mohammad Hatem and the BoD, BKMEA Executive President Fazlee Shamim Ehsan extended heartfelt congratulations to the newly elected Board...

Strengthening Global Solar Partnerships-BSREA and ABSOLAR

BSREA Officials, We are proud to announce that the Bangladesh Sustainable and Renewable Energy Association (BSREA) has officially signed a Memorandum of Understanding (MoU)...

Factors Affecting Fabric Air Permeability and the Importance of Air Permeability Testing

What is Air Permeability? Air permeability refers to the ability of a fabric to allow air to pass through it under a given pressure difference....