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Press Releases
2022-01-25  download as PDF Download this press release in Adbobe Acrobat format | download as DOC Download this press release in Microsoft Word format
Apparel supply chains hit by perfect storm as costs rise on multiple fronts

Global apparel supply chains are under pressure as prices of fibres and other textile materials rise, energy costs soar and costs of freight escalate, according to "Talking strategy: apparel supply chains hit by perfect storm as costs rise on multiple fronts", a 6-page report from the global business information company Textiles Intelligence.

The global cotton priceas measured by the Cotlook A Indexalmost doubled between April 2020 and December 2021, from 64 US cents/lb to 120 US cents/lb.

Finished goods have been taking longer to reach their destinations as shortages of containers and outbreaks of COVID-19 have halted operations and caused delays at ports. In fact, in many destination ports, the average median times spent by containers in depots—referred to as "dwell times"—reached near-record levels in 2021 as a result of severe congestion.

To add to the apparel industry's woes, companies importing apparel and other textile products into the US market which contain materials sourced from Xinjiang province in China face a new hurdle as a result of the Uyghur Forced Labor Prevention Act (UFLPA).

Under the UFLPA, companies which want to continue importing goods made in Xinjiang must provide "clear and convincing evidence" that the goods in question were not manufactured with forced labour. This places the onus on companies rather than customs officials.

However, global apparel supply chains are notoriously complex and it is often impossible to trace the origins of materials used in the manufacture of a garment. This will make it immensely difficult for companies to guarantee with confidence that the products they are supplying do not contain materials sourced from Xinjiang province in one form or another.

To ensure that they comply with the UFLPA, apparel brands are likely to play safe and source from locations which they can be confident do not use materials made in Xinjiang province. This would limit significantly the amount of cotton available for their products because Xinjiang province accounts for around 90% of the cotton produced in China and for 20% of the cotton produced worldwide.

In this scenario, the amount of cotton available to apparel brands could be reduced by 20% or more and, as a result, it is likely that cotton prices would rise. Ultimately, such a rise could lead to significantly higher apparel prices in retail stores.

"Talking strategy: apparel supply chains hit by perfect storm as costs rise on multiple fronts" is available for purchase from the global business information company Textiles Intelligence and costs 160 + VAT (UK), Euro290 (Europe, Middle East or Africa) or US$385 (Americas or Asia Pacific). To purchase this report, visit https://bit.ly/3tEu2Pc

The report is also available in Issue No 49 of Global Apparel Markets. Other reports published in Issue No 49 of Global Apparel Markets include: "Prospects for the textile and clothing industry in Pakistan, 2022", "Global apparel markets: product development and innovations, January 2022", "Global apparel trade and trade policy: leading textile and clothing exporters and key import markets, 2022", "Global apparel markets: business update, January 2022".

Global Apparel Markets is published four times a year by Textiles Intelligence. Each issue provides an independent and worldwide perspective on the global textile industry.

A year's printed subscription to Global Apparel Markets costs 945 + VAT (UK), Euro1,645 (Europe, Middle East or Africa) or US$2,120 (Americas or Asia Pacific). An electronic supplement is also available; please contact Textiles Intelligence for details. Single issues and multi-report packages are available on request. To purchase a subscription to Global Apparel Markets, visit https://bit.ly/3Aqs8mE

For further information about all Textiles Intelligence publications, please visit https://www.textilesintelligence.com


Emily Burke

Senior Editor


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