Rising polyester prices make cotton desirable again
With polyester and cotton prices converging, world consumption of cotton is forecast to increase by
5% to 24.5 million tons in 2014/15.
Consumption in Asia is expected to grow strongly in 2014/15, led by China’s 5% increase to 7.9 million tons. India’s consumption could grow by 6% to 5.4 million tons.
After international cotton prices spiked in 2010/11, many spinners decreased the share of cotton in yarn in favour of greater use of polyester. At the start of 2013, the gap between cotton and polyester prices widened.
Polyester prices remained fairly stable for most of 2013 until dropping to in April this year.
During the same period, international cotton prices climbed higher, reaching
99 cents per pound at their peak. However, the situation changed significantly in July 2014, with the Cotlook A index falling to 80 cts/lb while polyester has climbed back up to around 73 cts/lb. The price of cotton in China has also fallen from around 141 cts/lb during most of 2013/14 to around 126 cts/lb in the last few weeks.
