Spinning out of control

Hot on the heels of an international wheat shortage, the world cotton market is facing a similar supply crisis due to adverse weather conditions. The resulting record prices are a boon for Egypt’s dwindling cotton farmers, but have thrown the domestic textile industry, which relies nearly exclusively on cotton imports, into turmoil.  India, the world’s second largest cotton exporter, instituted export controls in May, triggering a price rise which was further exacerbated by flooding in China, the world’s leading producer; Pakistan, the fourth largest supplier, was also affected. By December, cotton prices had reached an all-time high of more than $1.68 per pound, a near 80 percent hike on prices earlier in the year. Normally accounting for around 40 percent of the world’s cotton production, China’s production is expected to fall 17 million bales below scheduled output in the 2010-2011 season. Also the world’s leading user of cotton, the Asian