The Nude Bomb  

Posted by Big Gav in , ,

The first generation biofuel disaster seems to be having another unexpected side effect, with the surge in grain prices causing cotton farmers to shift away to more lucrative crops. I'm going to make the first call of "peak clothing" and sit back to await the first doomer theories about the problems that will afflict an entirely nude society.

From the BBC - "The end of cheap clothes is near".

Food prices have shot up in response to a surge in crop prices. Now consumers should get ready for clothes prices to follow suit.

US cotton consumption is set to fall 6.5% from last year to less than a million tonnes whilst EU consumption is expected to fall 11% to about 460,000 tonnes, the Economist Intelligence Unit (EIU) predicts. At the same time, they are hit by more expensive raw materials and by soaring oil prices, which make their factories more expensive to operate and which pushes up the cost of shipping to foreign markets. In India, the weaving industry is in crisis. In China, the textile sector is squeezed. And, yet again, the root cause of their problems can be found in America.

In the US, ever more cotton farmers are switching to more lucrative crops - soybeans, corn, and wheat - whose market prices are rising even faster. The prices of these crops have been pushed higher by a mixture of subsidies, growing demand from biofuel producers and market speculation. "Cotton is taking its cue from whatever the other [commodity] markets are doing," according to a US commodities broker. "They set the tone for a lot of the things taking place in this market."

As a result of the shift by farmers, "the cotton harvested area in the USA is projected to decline by a further 15%" in the year ahead, predicts the International Cotton Advisory Committee (ICAC). That would bring the cotton acreage in the US to 9.5 million acres, down from 10.8 million in 2007 and from whopping 15 million acres in 2006. "It is obvious that [cotton] prices will be higher," ICAC says. This year, global cotton prices are set to rise more than 8% to 80 cents per pound, ICAC predicts. Financial market professionals think the rise could be even steeper.

Cotton shortages first emerged last year, when global demand for cotton exceeded global supply by about a million tonnes. In spite of the US shift towards competing crops, this year, the global cotton harvest is set to grow 3%, as major producer regions such as China, India, Australia, Brazil and West Africa are raising production.

Globally, supply growth is thus outstripping demand growth; cotton mill use is set to grow by just 1% this year. But even so, supply is not growing fast enough. This year's production level is expected to peak at 26.9 million tonnes of cotton, compared with demand for 27.5 million tonnes, the ICAC predicts.

But costly cotton is only one factor hitting clothing manufacturers. "It all comes down to energy," explains Bradley George, head of commodities and resources at Investec Asset Management. "We are basically short of power in the world right now." Hence, it is not only a question of whether land should be used to grow crops for food or cotton. It is also a question of how much energy should be used to produce clothes in factories.

Fertiliser costs are also soaring, adding to raw material costs, and the credit crunch is adding to the squeeze as low-margin clothes manufacturers are finding it harder to raise finance.

Of course, I can't let the opportunity pass to invoke the ghost of Maxwell Smart - maybe he can save us ?


Anonymous   says 1:41 PM

Peak clothes! That's a classic Big Gav. My personal horror story is Peak Vindaloo and Butter Chicken. If that happened, I'd lose about 50% of my calorie intake, and cease being the man I am today. ;-)

Driving huge gas guzzling SUV's is now quite literally taking food out of the mouths of people. If I had a bushel of corn for every middle aged woman I see stumbling out of an oversized SUV at the grocery store...

Anonymous   says 11:31 PM

Its obviously a plot by godless "liberals" to undermine the moral fabric of 'our civilisation tm' by uncovering our modesty and inflaming desire. At last the true agenda of the "global warming" proponents is revealed!


Driving huge gas guzzling SUV's is now quite literally taking food out of the mouths of people.

Not only that, but there is apparently a risk that it will prevent them replacing the shirts on their backs.

Lets hope no-one invents a clothes to biodiesel process to speed this up...

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