Why You Should Care That The Cotton Crop Failed in China this Year

Because fabric prices are about to go up.

That’s the simple answer: you should care that China and Pakistan experienced massive flooding in 2010, that India had record droughts and that in the US and Russia cotton was underplanted to meet demand, because all those factors combine to create a shortage in cotton for 2011.  And if you sew or craft or work with fabric (or wear clothes, for that matter), the shortage will affect you when you make fabric purchases.

Flooding in China, 2010
Drought in India affects cotton, soybean crops

This whole issue is both complicated and sticky.  Complicated because there are an awful lot of factors involved, and sticky because there are just as many emotions.  I wanted to take a day to really delve into some of those and set out what I think is an honest assessment of what the fabric world will be seeing in coming months.  I’m so excited to be part of the crafting community, and have the chance every day to continue to do something that I truly love, and meet the sheer number of folks who are learning to sew and loving sewing and who are new to this entire nutty land we’re building.  I worry that lack of information or misinformation will derail some of those new folks, and that a price increase will turn into dissatisfied stitchers, and want to do what I can to lay it all out on the table in advance of any price changes going into effect.

No One Is Being Greedy, I Swear.

The push-back that I’m hearing the most–primarily in online forums–is that it’s “unfair” for fabric suppliers to raise their prices in 2011.  The implication seems to be that this price increase is the result of choice on the part of the manufacturers and distributors for these fabrics, and that economy (or greed, depending on how cynical the post is) is at the heart of any changes.  When I read these comments or hear someone respond this way, what I’m hearing is the reaction of someone who doesn’t want prices to go up on an item they want and need–totally honest, genuine reactions.  Keep in mind, though, that the manufacturers don’t make their money one yard at a time–they make it over time, through building a reputation and attracting strong designers and creating a demand in the marketplace for their product: beautiful fabrics.  That demand is highest when we, as the crafters and stitchers who use fabric, see other projects made with collections and covet them for our very own.  Inspiring sewing projects made by someone else (and often posted on Flickr or blogs) are the number one way I get motivated to make something new.  For the manufacturers, they are an invaluable way to get their name out into the public, and as a result, THEY WANT TO SELL YOU FABRIC.  It is not in the fabric manufacturers’ best interest to raise prices beyond the point that customers can pay, because they won’t sell enough volume for them to continue to build their brand.  While I totally get that we all push back against price increases and want to blame big businesses, in this case, that really isn’t what’s going down.

Similarly, I have seen the occasional comment indicating that customers are frustrated when they visit smaller, local fabric shops and find that prices have gone up by fifty cents or a dollar per yard.  Especially for a prolific stitcher, that can feel like a punch in the gut–and that’s not to mention the budgeting we’ve all been doing already.  Trust me, as a shop owner I can tell you the straight skinny: WE WANT TO SELL YOU FABRIC.  And just like the manufacturers and the mills and the farmers who are further up the supply chain from me as a retailer, I hate that there is less cotton to go around right now.  I feel frustrated when I get word that prices for my wholesale fabric are about to increase, because in order to stay in business, I have to purchase at a higher price, and then raise the price in the store to make room in the shop budget.

It comes down to basic economics.  Now, I took an 8 am summer session class when I did the required Economics course as an undergraduate, so I didn’t learn some of the subtler nuances, but I do remember the supply and demand curve: when there is less supply and demand remains unchanged, prices increase.  That’s not because those who have the product get greedy and decide to bilk those of us who want it.  In this case, it’s because the farmers who grew the cotton planted it with the expectation that the crop would come in at a certain volume, and they calculated their profit based on that.  Farmers, with families, who have children to feed whether the cotton crop failed or not.  Farmers with futures, who have to plant cotton again next year, and can’t do that unless they’re able to make something off their crop this year.  These guys aren’t carpetbaggers looking for easy pickings–they’re folks who want to make a living, and are struggling against an unforeseen event.

In order for farmers to get paid, the price has to increase on what little cotton there is.  That price gets passed along to the mills who weave and print the fabric, then to the manufacturers who work with the designers and the mills to make the fabric beautiful.  That price increase translates to a higher cost to me as a retailer–as much as 60 cents per yard higher beginning in January 2011.  As a shop owner, and a small shop at that, I can’t put myself in a position to absorb that cost.

Think of it this way: you know the way you feel when you think about having to pay 50 cents more per yard at the fabric shop?  And you multiply that out by the number of yards you’ll need for your project?  And you feel frustrated, maybe a little disappointed or depressed?  Imagine how you’d feel if you multiplied that by 6000 yards?  Most small quilt shops, like Whipstitch, will purchase 6000 yards of fabric in the next three months, easy.  And we have to pay for it up front, whether it sells to the customer or not.  Raising prices by 50 cents a yard is, in many cases, below the increase that I’m having to absorb, and represents the minimum increase I can make and still stay in business.

Why Shopping at Your Local Fabric Shop Will Help

Most local fabric shops are like Whipstitch: we’re in this business for LOVE, not for money.  I know that no one ever, ever wants to learn that prices are going to increase on something they really can’t live without (like milk or fuel or fabric–all totally in the same category, as far as I’m concerned).  Those of us who work in fabric shops are all there because we love it–and because we’d probably be there anyway.  We all buy fabric, too, and would love to see prices stay low.  The news has been full of stories about how the failed cotton crops will affect pricing in the new year.  The word I’m getting from my manufacturers representatives (the lovely ladies and gentlemen who visit the shop to show me new fabric lines in advance so I can order them to have in stock) is that prices are going up across the board, at all the major suppliers, like Robert Kaufman, Michael Miller, Alexander Henry, and Moda.  It’s been a whisper for a while, then became a rumble last summer, and word is that January 1 the new pricing will go into effect.  Most manufacturers are quoting 4-8% increases on their cotton lines, which translates to a recommended retail increase of 40-80 cents per yard, depending on the fabric.  If you’re seeing increases at the local level of 50 cents, that’s because shops are absorbing much of the cost for you in an effort to keep prices as low as they can.

One of the best ways to meet the change head on is to support your local fabric shop. Some of the bigger box stores will either raise their prices to the maximum, or will turn to lesser-quality fabrics in order to lower their own costs, and thus keep costs low to the customer.  Your local fabric store is owned by someone who loves sewing, knows you by name, and is committed to not only retailing fabric but helping you personally.  By shopping with these locally-owned businesses, you’re getting to know your strongest advocate: the shop owner, who has the ear of the manufacturers in a way that you don’t, and will tirelessly work to keep prices affordable so you can keep sewing.  The bigger companies, unfortunately, do not have a reputation for doing the same.  As I read on one of the message boards, LadyBugPam said:

Frankly I cannot bear to touch the WM or JoAnn fabrics. I have been strictly high quality quilt shops! The prices have hiked up – but it is worth it in the long run. My quilts are made to keep. My one and only WM fabric quilt was brutally destroyed in the washer. All that work in a ball.
I shop groceries at Aldi’s – I buy discount or sale on clothing, home repairs and I keep my thermostat low in the winter and high in the summer. But my fabric habit will not suffer. My DH has a similar attitude about his beer and vehicle.

Call me crazy, but that sounds like a lady who has her priorities in order (not to mention her husband).

If you don’t have a local fabric or quilt shop near you, no worries!  The internet does.  Whipstitch will be delighted to be your online source for fabric, as will a number of other high-quality retailers.  Be aware, though, that there are gray market retailers out there: prices are lower, but they’ve cut back on other details in order to make their prices lower.  Like customer service: just look what readers of Lizzy House’s fantastic post about local quilt shops had to say about their number one requirement for repeat business–customer service.  It’s sadly missing in many places, but your local shop is delighted to have you walk in the door (virtually or in the flesh), and that’s worth an extra 50 cents or a dollar to just about anyone.  Or what about longevity?  Those gray market retailers won’t be there down the road–they can’t be, because they won’t be able to afford to stay in business.  A retailer who offers amazing service and consistent product, who you know will be there in the future, is someone you can invest in.  While some may argue, as I read in one online forum, that “the sales will start when our purchasing stops,” lower prices mean shorter lifespans for shops when it means that shop owners can’t keep the doors open any longer.  By shopping at your small, local fabric store, you’re working toward keeping the fabric you like coming out, keeping prices as low as possible while maintaining high quality, and supporting your community through something you love.

If You Love It, Go Ahead and Get It

The short, immediate answer for you is this: if there’s something out right now that you really want and love, go ahead and grab it for yourself.  After the first of the year, it will likely cost a little bit more.  It’s possible that this has farther-reaching implications than we realize: even the larger manufacturers are considering raising their clothing prices for off-the-rack clothing in 2011.  If prices don’t come back down in the coming year, we might find that economic reasons for sewing our own clothing are back in vogue.  Having some yardage on-hand that you purchased at 2010 prices will be very handy then, indeed.  Over the long term, my answer to the question of how to manage the cost of fabric is this: shop locally, make it possible for those of us a little closer to the manufacturers to advocate on your behalf to get prices to stabilize.  Build a relationship with a shop owner, in person or online, so that the two of you can forge ahead together and ride it all out in stitchy harmony.  I want to see you sewing for a long, long time to come–and I’m looking forward to seeing what you make!

At Whipstitch, we’re doing our best to absorb what we can of the cost of rising fabric prices.  Our 2010 prices on fabric will remain in place for all inventory currently in the shop.  In-coming fabrics will be priced at an increase as they arrive in 2011.  I sincerely welcome your feedback and suggestions, and would love to personally answer any concerns you might have!

Looking forward to hearing from you,

Deborah

27 Comments on “Why You Should Care That The Cotton Crop Failed in China this Year

  1. What a fair and honest assessment. As a retailer myself (maternity and baby boutiques) I absolutely appreciate how transparent you are choosing to be. It’s true that in this economic climate no one is trying to get rich – we’re trying to stay open!

  2. Thank you for your post. As a consumer, it is good to hear. I think so often when prices go up it feels like how the price of gas goes up and down seemingly arbitrarily. This is totally different. Thank you for being open and honest. I have a new understanding and won’t complain when prices go up.

  3. Thank you for sharing this information. CHEERS!
    My husband and I try to make efforts to support local business as much as possible. We feel much better handing over our hardwon earnings to a local entrepreneur over a big box retailer. I work for a family owned private company, and there is a great difference in our business than the experiences I had working for multi-national public companies. I’d rather pay a local business owner who cares about their employees and customers than fork over my cash to Walmart!

    Sure, that means we pay more for our dogfood, but it’s worth it to feel good getting high quality nosh from a local man who truly loves animals and is passionate about our dog’s nutrition. Likewise, it’s fun to shop in your store and see you and your employees get excited about projects we talk about and are planning with your merchandise. (I was there on Monday!) Erm, not that I’m comparing your fabrics to dogfood, erm…

    Anyway, thanks for being passionate about sewing and sharing your craft with us and for caring about your customers. THAT is why you will be successful and have loyal customers no matter what the economy does to prices.

  4. Thank you for taking the time to write this very thoughtful post. On the whole, I think you do a great job of laying out the very real issues that stem from the cotton crop situation and assessing it from the perspective of a retailer and fabric lover. However, I think the consumer’s perception of greed, as presented here, is a little off. I fully recognize that retailers have very little control over pricing — they buy at wholesale from manufacturers at set prices and they need to earn a profit. I’m not shocked by the fabric prices at my local quilt shop or my favorite online “locals.” I can’t always afford it, and have to use my budget wisely, but I understand the pricing.

    When I think of greed, I think of it at the level of the manufacturers. Why? Because while they too need to make a profit to stay in business, they don’t lower the wholesale price when the cotton crop is abundant and thus their costs are lower. There are years of plenty and years of scarcity, but their prices don’t rise and fall; they merely rise. A true supply and demand curve would show falling prices in years of cotton oversupply, but I have yet to see that happen. Thus the sense of indignation of price increases relates (at least for me) in the manufacturers decision to raise prices in years when the cotton crop is in demand, but not to lower prices in years in which the cotton crop is flush. If I saw a pattern of price fluctuation rather than an upward curve of price increases, I would have no problem with the manufacturers decision this year as it would, indeed, follow the price curve. But it doesn’t. And, in fact, solid business practices at the level of manufacturing would allow for cotton prices to fluctuate without affecting the retailer or the consumer as manufacturers would anticipate different crops and prices, build it into their price models, and only need to adjust moderately over time rather than take a big jump one year and simply leave it in place even if there is too much cotton next year.

    I want to be clear that I don’t in any way blame retailers for this as they have to deal with prices as set from above. The flexibility exists at the level of manufacturing but profit motives/greed (and this is where I do think there is systemic greed built into the system, not individuals gleefully grinning about how they are taking advantage) preclude thinking like this. My beef is with those who could absorb a loss this year because they were extra profitable in past years and will be again in the future. This is not the local or online retailer, from whom I will continue to buy fabric albeit less fabric.

    • 2hippos–

      I think you have a valid point. I will say, though, that the manufacturers have delayed and delayed any price increase for months–there was talk that it would come about last summer, but they really worked not to have that happen. The information I’m getting direct from them indicates–states, in some cases–that they have been absorbing the rise in an effort to bide their time, hoping cotton would go back down and all would even out. It hasn’t, and prices are rising, but I believe they sincerely hoped that wouldn’t happen. I think you have a very fair point that while gasoline tends to fluctuate, the pricing we see in fabric is much more likely to go up and stay up, and that’s both a valid argument and a genuine criticism, one that I haven’t heard any of the manufacturers address.

      Thanks for taking the time to point out another side to the issue–like I said, it’s complex and with so many levels and factors involved, it’s challenging to really see a full picture.
      Deborah

  5. Thanks for your response Deborah. It’s good to hear that manufacturers actually attempted to delay the price increase; more transparency about this sort of issue would, I think, be beneficial in showing consumers that even if the price curve only rises, the rise has at times been delayed.

  6. Thanks for posting this, Deborah! Over the past couple months, I’ve been tweeting links to articles about this. It’s a sad and shocking fact that the devastation to the cotton crops was unlike any ever seen before, and it was not something that could have been planned for and strategized about in any kind of pricing model. In fact, cotton prices have historically been kept so much lower than they should have been in the first place (where farmers don’t truly earn a living wage regardless of natural disasters) that there isn’t anywhere to casually absorb a loss or add a price increase – it’s economically inelastic and bumps will most def be felt. From where I’m standing, as a manufacturer of my own organic cotton fabrics, I see a lot of other issues that were intentionally working against this system to begin with – which then makes a legitimate obstacle that much more unavoidable and magnified.

    I appreciate your honesty and perspective in this post!

  7. Great post, Deborah. A very thoughtful and well-considered explanation of a sobering situation.

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  9. Thank you for helping myself and others to understand the situation ahead of us.Thank you for explaining why prices may be higher for fabric shoppers like myself. There is a larger choice in fabrics and prices online compared to local shops, even with shipping, but I will try to support my local shops as you suggest. Thank you for this information.

  10. I was wondering if/when you would talk about the cotton crop failure, and I am so glad you did! Of course prices will rise, but it’s really helpful to me as a sewing consumer to know that a 50 cent per yard hike is really about the shop biting the bullet instead of the consumer. It just makes me want to come to Whipstitch and buy even more from you. That, plus your continually awesome selection and really unreal good customer service. Thanks for being there.

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  12. Thank you so much for taking the time to educate us on this subject. I will share this information with others.

    Helen
    Denver

  13. I just ordered 100 metres of cotton and the price was up from my last purchase in the fall. My profit margin is lean already, so I may have to raise my prices. FYI — check out this blog, I like to follow it. Always has interesting and informative articles about the textile industry:

    http://www.rantoshak.blogspot.com/

  14. You are such a smart gal deborah, thanks for this. I love this sort of simple breakdown of such a complex issue. Thank you!

  15. This was such an informative, well written post. Thank you for the information as well as the transparency.

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  17. Awesome post – very informative and well written. I posted it to my shop’s facebook because I found it so interesting. (My shop is Something Sewn.)

    Also, I will be using that line on my husband that I will only switch to lesser fabrics if he plans to drink Bud Light.

  18. i agree wholeheartedly with what you write … it’s vital to support your local fabric/quilt shop … however, today i was in the shop and saw a lot of extra staff in the fabric bolts, the end caps, etc … asking what was going on, inventory, or???, the head salesperson told me they were taking off the old prices and putting on new ones …..

    hmmmmm ….

    so i asked why and she said, *because the price is going up … now* …. i, knowing, of course, that this current fabric was already paid for by the retailer, asked her if this was not a bit early and shouldn’t they consider this *old stock* and only raise prices on the new stuff (not due in for a while) … her response: *well, that’s the way business does it and that’s the way it is!!!* …..

    maybe *business does it* like that, but i will not give them any more of my business …

    i feel, like your last line says, *At Whipstitch, we’re doing our best to absorb what we can of the cost of rising fabric prices. Our 2010 prices on fabric will remain in place for all inventory currently in the shop. In-coming fabrics will be priced at an increase as they arrive in 2011!* …

    this is more than fair and i’m expecting to pay that raise in price (i LOVE, LOVE, LOVE my quilting cottons!!!), but i will not pay what is in some cases a more-than-30%-increase in price — flannel, quilters flannel, raised from $7.44 a yard yesterday to $10.00 a yard today …. when i was in yesterday, why didn’t they announce, post a notice that 04 february 2011 prices would rise …

    i feel cheated and violated … they are the only quilt store in yakima, washington — craft warehouse — and, other than online, we are stuck here … we can drive 2.5 hours to seattle and incur the expenses of an all-day trip to the *big city* and all that entails (meals out, major parking expenses, not to mention the gas at $3.05 at costco, or we can purchase online and forget the local shop ….

    i’m sure i’m not the only one here in yakima who feel thus … i hope they realize what they have done to their loyal customers … basically, ripped us off ….

    sorry for the vent, but not all retailers are fair or nice ……

  19. Pingback: True Up | All Fabric, All the Time » Blog Archive » Textile Stew: 2/9/11

  20. Pingback: Link: All About Cotton Prices with Deb from Whipstitch | Fabric Shoppers Unite

  21. Wow Deborah. Thank you so much for explaining all of this. I knew that prices were to be going up because I had heard it from several of my favorite shop owners. But I never knew that the cotton crops in Asia had failed due to flooding and drought. I just never made the connection. I always have, and always will chose to purchase from, and support small business, especially my favorite fabric shops. I have a rather enormous stash of fabric, both purchased and gifted over the years. But I still try to purchase fabrics that I simply must have. Beautiful fabrics are art and should be valued as such. Thank you for putting it all out on the table so I have good information to share with my husband when he whines about my buying more fabric! I am supporting business!

  22. Thanks so much for this informative and compelling post, Deborah, on so many different levels. Bear with me, as this is not going to be brief.

    I must agree with 2hippos’ argument on one level. I will also debate a couple of points from the stand-point that I am a long-time seamstress and know my “sewing stuff” well.

    There is no doubt you write this as an ethical retailer who loves quality fabric, and cares deeply about customers and the stability of the fabric industry. Unfortunately, not all retail fabric or quilting shop owners (especially those who have survived the long, declining economy) think along the same lines, and neither does the American textile industry in general. Even well-meaning sewing organizations fail to be all that considerate when they charge a fortune for annual conventions where it’s acceptable to make light of “feeding our fabric addictions.” Let’s not forget the outrageous cost involved in sewing machines today and enormous shipping costs to get supplies on-line.

    I admire your optimism in urging us to meet the change head on by “supporting our local fabric shop.” It begs the question, however: “Exactly how will the average American fabric consumer solve an enormous global issue when the entire US textile industry won’t step up, speak up, and save the industry from itself first? Perhaps the consumer would be a little bit more optimistic if there ever was a time he or she could truly rely on one “local fabric store” (that’s assuming we all have one), without having to go to “several sources” to purchase “all the necessary ingredients” to finish “just one single project.” How do you propose we solve that first?

    I do not wish to make light of the floods in India and China or the hard-working farmers who barely survive the toils of the cotton fields. I must draw the line, however, when we blame mother-nature for our “inconveniences or misfortunes.” Rather, I feel strongly that this is an inevitable consequence of irresponsible behavior “at home” once again. We shrug it off with another beer, but on a more serious note, it all goes back to our nation’s “gifting” of all manufacturing to “cheaper” sources, without much foresight that our own survival depends immensely on manufacturing “at home.” To make matters worse, our nation has abandoned the vital “Plan B”, which, in this case would have been to grow “ample” cotton at home, in case “Plan A” in China and India went belly up! Ultimately, that is the real reason we should care and worry about this. Everything else we “need at home” and don’t manufacture “at home” may very well succumb to the same ill-fated destiny. The fashion industry, after all, has always been a good indicator of things to come.

    Let’s also not ignore the fact that China and India are wealthier now as a result of manufacturing in their own countries and consumers there are now reaping the harvest of the seeds they planted with our help. Simply put, consumers there are now enjoying their own buying power at “pre-export” prices, resulting in a very explainable “shortage” here. I found it quite ironic a few months ago, when an Etsy customer from Hong Kong conveyed to me that she was looking to place a custom order from me because “it is cheaper for her to order from the US.” The tables have turned, and this is now the story of the Ant and the Grasshopper!

    Lastly, I must also agree with your “Guest’s” reply and speak up for those of us who simply “do not have a reliable local fabric store to support.” I live in a metropolitan area, but I too have to travel 120 miles or pay an exorbitant amount of postage to get the “fine fabric” I need to make custom “keepsake” products. Many “brick and mortar” fabric stores around my area have closed. I have no choice but to absorb ever-increasing “miscellaneous” costs involved in keeping my customers happy and, at this rate, my business will not survive “riding out this never-ending American Storm.” For the past 3 years, I have done exactly as you suggest: to “build a relationship with [many] shop owner[s], in person or online, so that the two of [us] can forge ahead together and ride it all out in stitchy harmony”. Let me assure you once again, NONE of these nice people have gone an extra mile to help with my needs for consistent and reliable sewing supplies. Inevitably, I see the look on their face or hear the silence in their voice when I give them my tax ID number and tell them I am an Etsy seller. Perhaps they have all been mis-guided by the only link you and the entire sewing industry seem to refer to about “Grey Market” sellers. I’m not sure. The average consumer, however, may not realize that the over-simplified “policy” written by Oliver-S applies to the sale and use of their own patterns. It is not necessarily the true definition of a Grey Market seller. But taken literally, or out of context, those words do a great disservice to many amazing, legitimate and hard-working sewers and sellers at Etsy and other creative on-line venues. Good seamstresses, custom boutiques, on-line boutiques and all those who love fabric creations are the retail fabric shop and pattern/fabric designer’s best friend in advertising. You won’t find better allies than that! But, none will benefit from this debate in “stitchy harmony” if we don’t start supporting each other seriously first. So, while you and other shop owners have the “ear of the manufacturers in a way that we don’t”, please do consider working tirelessly with Congress, as a first step, to turn the manufacturing tables back around where they belong — at home!

  23. Pingback: Rising prices of cotton…and everything else : Harper Academy

  24. It’s true! I didn’t read all of the comments, but we have close friends that operate a thread mill in southern India, and believe me…they are feeling the pinch as well. The supply has indeed shrunk!

    • Thank you so much for sharing this info! We don’t hear much from folks who are on-the-ground, just from what the media relay to us, so it’s good to get a more first-person account.

  25. …and here it is 2013… not greedy? Ha! Has the price of fabric gone down? Raw cotton is back to where it was early 2010…