06/05/2020 – Standstill of the cotton and textile industry — auf Deutsch lesen
Covid-19 leads to record downward adjustments
The rapid global spread of the Covid-19 pandemic and the protection measures implemented in this regard lead to massive turnover losses of companies.
The April USDA forecast has world cotton consumption down 1.65 mn tonnes (or 6.4 percent) from last month. It represents a loss of about 3-and-a-half weeks of global spinning or about 16 percent of the expected spinning March through July based on the March USDA forecasts. While spinning and other manufacturing sectors in China have begun to recover to some extent, reductions in consumption this month are reported across all consuming countries of note such as India, Bangladesh, Pakistan and Vietnam.
Cotton prices have declined significantly in recent weeks, with the nearby ICE futures contract falling below 50 cents for the first time in over a decade. Yet, on April 22, nearby futures have slightly recovered to 56.28 cents.
ITMF has recently conducted a survey among ITMF Members and affiliated companies and associations about the impact of the Corona-pandemic on the global textile value chain, especially on current orders and expected turnover in 2020. In total 700 companies from around the world participated. Worldwide, current orders are down by -31percent on average .The results show that companies in all regions of the world suffered significant numbers of cancellations and/or postponements of orders. On world average, the turnover in 2020 is expected to be -28 percent lower than in 2019.
Sources: USDA WMT Cotton April 2020, ITMF
Newsletter No. 49 (April 2020) – Special Edition