Assuming that we are getting back to “normal,” my question is whether we can infer any influence in the upstream direction. That is, does the slight downtrend in yarn and apparel prices say anything about the likely trend for cotton prices?

Here we are no longer talking about passing along cost increases. Rather, we are talking about how the supply and demand for yarn (reflected by yarn price) translates back to the derived demand for cotton fiber.

The theory would be that weakening demand for cotton apparel and/or excess supplies of yarn are reflecting in reduced consumption of cotton fiber. One manifestation of this may be the lighter weight and lower cotton content of imported apparel, a trend that has persisted since the 2010/11 price spike. To my knowledge, nobody has done the proper causality testing to see if the current data reflect the upstream influence of weak yarn and apparel markets. 

In the meantime, it just leaves me wondering a bunch and worrying a little.

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