Cotton prices in China escalate almost on a daily basis, scaring out the textile and garment industry, which have the fiber as a core crude material, according to reports from the People's Daily Monday.
Only from September to the beginning of November, prices were adjusted about 70 percent, from 18,000 yuan ($2,707) to 30,000 yuan ($4,512) per ton.
Hiking prices inevitably trigger a domino effect: Yarn prices – which have doubled, fabrics and cotton cloths follow the trend in varied degrees.
"It simply jumps in such a way that we can't help but to fear taking orders," said Yang Hua, manager of a textile company in Nantong, Jiangsu Province.
Although every year from September to March of the following year is a golden period for the industry, this year, about 60 percent of factories in Jiangsu, Shandong and Zhejiang – major cotton producing areas – have been put idle.
According to reports, Cotton-output squeeze, increase in demand, depreciation of the US dollar and speculation on hot money all are culprits in such crisis.
"But the Chinese government, realizing the seriousness of the situation, is taking measures to regulate the whole industry. However, besides governmental aid, textile companies should also try to improve their core technologies to ward off risks," said Yang Zhaohua, chairman of China Home Textile Association.
Other effect-takers of the cotton price crisis are the motor transport and aviation hygiene, which face a costs-up menace, according to reports.