Cotton price has dropped below 60 cents, lowest since 2009. If the price drop continued, cotton farmers will certainly seek other alternatives. Evelyn Nguleka, the head of the farmers union in the southern African country, said that dramatic fall in incomes has made farmers’ life “increasingly difficult,” according to the Financial Times.
As many may know, one of the reasons for the price drop is a result of the excessive stock in main export countries, a.k.a. China. China reportedly holds 60 percent of the current global cotton inventories. China’s pushing this stock cotton to the market at a lower price forces the market price to be lowered to be competitive.
Some industry experts say that the price won’t recover until the cotton stockpile runs down, in additional to cutting the global production, according to the Financial Times.