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    Global Markets: Cotton – Turkey Textile, Product Exports Spur Record Consumption

    Cotton harvest. ©Debra L Ferguson

    Turkey’s 2021/22 cotton consumption is forecast at a record 8.5 million bales and use is expected to grow more than 10 percent, well above the 3 percent consumption growth forecast for the world. Turkey is forecast to contribute a significant portion of the world’s record 2021/22 consumption, behind only India in its year-over-year increase of 0.8 million bales. Logistical advantages, changes in global retailers’ sourcing strategies, and duty-free access to the European Union (EU) are supporting robust cotton product and textile exports.

    Despite global issues with ocean freight, Turkey’s location is ideal relative to other cotton product and textile exporters. Turkey is near European and Middle East markets, with the EU being the world’s second-largest importer of cotton products. Turkish exporters can also ship by rail or truck versus relying solely on ocean transit. Additionally, Turkey’s Customs Union with the EU means that most textiles and clothing products can be exported duty-free to the EU and European Free Trade Association countries.

    Outside of logistics, EU and U.S. retailers are actively restructuring their supply chains to rely less on manufacturers in Asia (particularly China). The United States is the world’s largest importer of cotton products, and U.S. retailers are seeking to comply with the U.S. Withhold Release Order (WRO) on products containing any derivative of Xinjiang cotton. Compared with China and other major exporting countries in South and Southeast Asia (e.g., Bangladesh, Vietnam, and Cambodia), Turkey’s supply chain from lint to finished fabric is mostly absent of Xinjiang lint.

    Turkey cotton product and textile exports are booming despite widespread economic concerns. These include exchange rate fluctuations, rising energy costs, electricity cuts, cotton prices more than doubling (in local currency), and slower tourist activity (a significant contributor to domestic economic growth). Although the lira’s plunge makes cotton lint imports and other inputs more expensive, the lower-valued currency also makes textile and product exports more affordable for foreign buyers.

    Despite these economic headwinds, lower priced exports continue to surge. With global retailers seeking alternative sources outside Asia and with Turkey’s logistical advantages, these factors provide a strong foundation for 2021/22 consumption and beyond.

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