Fluctuations in international cotton prices impact Vietnam’s textile industry
According to Vietnam’s “Economic Times” report, due to factors such as climate and planting technology, Vietnam’s cotton output is low. 90% of the cotton required by the country’s textile industry depends on imports, and the average annual growth in demand is about 10%. In 2010, Vietnam imported 360,000 tons of cotton, with an import value of US$700 million. In 2011, it is expected to import 400,000 tons, with an import value of approximately US$1 billion. Since 2010, cotton prices in the international market have experienced violent fluctuations from sharp increases to rapid declines, which has directly affected Vietnam’s textile industry. When cotton prices rise, Vietnamese textile companies import large quantities of cotton to stockpile supplies. In April 2011, cotton prices suddenly fell, and enterprises were caught off guard. The cotton yarn produced previously was difficult to sell because of its high cost, resulting in serious losses. In order to reduce costs, garment processing enterprises searched for cotton substitutes. The demand for cotton yarn decreased, further exacerbating the difficulties of textile enterprises. .
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