According to the National Council of Cotton, world cotton prices are now about 50% more than last year at this time – from about 60 cents per pound to 90 cents per pound – and will likely increase further in the coming months. With T-shirts the top-selling item in the ad specialty industry, suppliers, already feeling the pressure of the increase, are advising distributors to prepare for costs on apparel to climb in the next few months.
“By late summer and early fall distributors will start to see across-the-board price increases,” says Anthony Corsano, CEO and president of Anvil Knitwear (asi/36350), though he could not say exactly how much costs would increase by. Corsano suggests that distributors order supplies for orders as soon as they can to lock in lower prices where possible.
Gary Adams, vice president of economics and policy analysis for the National Council of Cotton, agrees, saying that distributors, “have to anticipate what their needs are going to be as much as possible so they’re not caught short or unaware.” Adams says that not only has the price gone up, but as corn and soybeans have become more profitable crops to produce, and regions like India have curbed their exports, the supply of available cotton has gone down. “We are seeing those higher prices moving up the textile processing chain – yarn prices are higher than they were a year ago, and eventually that’s going to make its way up to the retail level.”
Echoing this sentiment, Garry Hurvitz, president and CEO of Counselor Top 40 supplier Ash City (asi/37127), recently sent a letter to customers outlining the current apparel pricing environment and specifically pinpointing cotton as a raw material cost that was increasing. In the letter, Hurvitz wrote, “Specifically impacting our cotton based apparel is the worldwide shortage of this product and with yarns being more difficult to obtain, we are seeing production delays and material cost increases everywhere.”
