Competition from Synthetic Fibers and Its Impact on the Future of Cotton

Cotton is one of the most important textile fibers in the world, and the United States is a major producer and exporter. But, cotton is losing its attractiveness and is faced with unique competitive forces, which are threatening its place in global textile markets.  

With this as background, we have been analyzing the impact of competitive forces/threats faced by the US cotton sector using the framework of Porter’s five-force analysis. The five forces that are being analyzed include, the threat from existing other major cotton exporters, the threat from new entrants, the threat from substitutes for cotton, the bargaining power of buyers like China and the bargaining power of suppliers of inputs to cotton cultivation.

In this paper, we focus on the threat posed by synthetic fibers to global cotton markets. As the global consumption of synthetic fibers has already surpassed the consumption of cotton, it is important to understand what factors impact the buyer propensity to substitute cotton and whether there are any favorable trends for cotton use in the future. We analyze the micro and macro economic factors that impact the production and consumption of synthetic fibers. The study also aims to understand the economics of production of synthetic fibers and compare it with economics of cotton fiber production. Gaining an understanding of the manufacturing process of synthetic textile fibers and the associated supply chain management helps us in chalking out better strategies for the cotton sector. Many experts have emphasized that the cotton sector worldwide has to innovate, create new products, new ideas and new technologies to deliver value to the cotton consumer (Lyon, 2014). We expect that the findings of our study will help identify how we may keep cotton as a preferred choice for buyers in the face of the competition from synthetic fibers.