Cotton Market

Cotton is a natural fiber harvested from the cotton plant. Cotton is very important it is one of the oldest fibers used by humans, and we know this because traces of cotton have been found that are dated back at least 7,000 years. Cotton is also one of the most used natural fibers today by consumers from all social classes and nations. Cotton is mainly used to make clothing items but it has numerous uses and a variety of applications. There is a large demand for cotton so thousands of acres of land are dedicated to the growing of cotton globally (Smith). Since cotton is a widely used commodity it has a very large market; in 2007 cotton was grown in as many as 90 countries the main ones being China, India, the USA and Pakistan. These four countries accounted for approximately three quarters of world output in 2007 (Anderson). Since cotton is a highly demanded commodity it has a rather large market and this is why the government is constantly making changes in order to make this market more successful. The government continually makes price adjustments to cotton to be able to stimulate the growth of the production. There is more than enough cotton to go around but there was a fear that the supply would be less than the demand, it is a relief to see now that the supply is on its way to doubling what it was in previous years. “Since the beginning of the 1940s, world cotton consumption has increased at an average annual growth rate of about 2% which was about equal to the growth of production” (Smith). The 2010/11 U.S. cotton forecasts shows a higher production which will include the use of domestic mills and increased exporting of cotton. According to Lowell production is around 18.5 million bales which is nearly 52% above last year’s cotton production this may be based on the fact that there has been an increase in the uses of the cotton belt which is southern regions in the united states where cotton is predominantly grown.
The demand for cotton has dropped during...