Declining Cotton Prices Is Expected Increase Work Orders

Cotton and yarn prices are falling in the international and local markets. On June 28 cotton was traded between $0.92 to $1.09 per pound in markets, while last month cotton was traded between $1.31-$1.32. Falling prices are expected to reduce production costs and as such many local Bangladesh garments exporters are expecting work orders to increase from December.

High cotton prices were a major barrier for many international retailers. They put a large portion of their orders on hold. Now as the prices are coming down, they are expected to increase orders.

Low prices of cotton will enable local manufacturers to supply items at a competitive price, this will prompt buyers to place big volumes of work orders, said Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association.

If the current low cotton prices continue for the next few months, yarn prices will go down further. Currently, 30 corded yarn is being sold between $4.45-$4.60 per kg. Comparatively, in February and March, it was around $5.25-$5.30 per kg.

Mohammad Ali Khokon, president of Bangladesh Textile Mills Association, said “local manufacturers have already bought all the needed cotton for yarn till October at higher prices and once China starts buying cotton in bulk cotton prices will increase.”