Clothiers Contend With Crisis In Cotton ...In today's New York Times, there is an insightful article on the impact that high cotton prices is having on the apparel makers. Supplement to the Toronto Star, Page 8.
Here are some of the comments from this half page article by Stephanie Clifford;
"The Bon-Ton chain is raising prices on its private-label fashions items by as much as a dollar this spring, and prices will go up further next fall. And it is switching from 100% cotton in items like sweaters to more acrylic blends. Levi's says it has already increased prices and may push then further north next year. And Hanesbrands, the maker of Champion, Hanes and Playtex, says price increases will be in place by February, and prices could go up further if cotton prices remain where they are".
"The problem is a classic supply and demand imbalance. with the price of cotton rising almost 80% since July and prices are expected to remain high".
"World cotton production is unlikely to catch up with consumption for at least two years," said Sharon Johnson, senior cotton analyst with the First Capital Group, in an e-mail.
"So far, it has shocked even the most veteran trader," said Mike Stevens, an independent cotton analyst in Mandeville. Louisiana, in an e-mail. "It has resulted in panic buying by the mills worldwide in order to ensure that they can keep their doors open."
"We may be training a new generation to be far more accepting of synthetic fibers, which is likely to hurt cotton's market share in the long run", said Ms Johnson, the analyst with the First Capital Group.
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(I own Barrick Gold Shares too YTD + 45%)
Have a great day all.
Don't forget to do your Christmas clothing shopping early this year!
Cheers,
Nighthawk