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India’s COVID crisis may lead to global shortage of cotton

Posted May 26, 2021

 

ST. CLOUD, Minn. – India has been hit with a new variant of COVID-19, and it’s spreading fast. While the U.S. may be improving with the recent distribution of vaccines, Indian citizens –especially in urban areas – are struggling to find hospital beds, oxygen tanks and struggling to survive.

 

Although the virus had previously made its way through India, an average of 295,000 people each day have contracted the new variant dubbed the “double mutant” since the end of April.

“We are calling it Tsunami COVID,” said King Mukherjee, president and founder of Global Impex USA, based here. “People were not social distancing, they were not wearing masks, nothing. So it was business as usual and all of a sudden … the cases started rising dramatically, drastically.”

 

All of Asia’s outbreaks are hitting major global supply chains that could lead to greater inflation in the U.S. This sudden surge of the new variant has heavily affected India’s fabric manufacturing and the global textile industry.

 

Sarvesh Jain, a representative from Mamta Global Trading based in Sangli, Maharashtra India, said the virus impacted India’s entire domestic supply chain.

 

“After six or seven years, this is the highest price for cotton,” Jain said.

 

Supplies from India have been delayed, making cotton more likely to be added to the growing list of commodities that are becoming harder to obtain in the future. Current commodities that are difficult to obtain include gas, steel, microchips and more.

 

“Shortage or delay in supply will happen if countries go into complete lock down,” said Mike Sanders, the national marketing manager for Akron, Ohio-based business Schott Textiles, Inc. “There will be no workers in fields to pick up cotton and less people to run the looms.”

 

India is the largest cotton supplier in the world, meaning its COVID crisis is affecting all companies in the textile trade.

 

“When India's supplies go down – and it is going to go down drastically in the coming months – I personally feel there is going to be even more shortages, and the price is going to go even higher,” Mukherjee said. “I think around three to six months time, there will be a big shortage gap.”

 

Most recently, Gujarat, a state of India, has been hit by the most powerful cyclone in two decades, Cyclone Tauktae. The cyclone forced over 200,000 people to evacuate and killed over 100 people. A second cyclone, Cyclone Yaas, will most likely hit eastern India, forcing more than a million people to evacuate.

 

“All of this is affecting the supply chain, the cotton supplies, the factory production,” Mukherjee said. “Our containers right now, they’re stuck on the boat … there are four thousand containers and shipments stuck there because of the cyclone.”

 

Jain also mentioned that high fuel prices in India and a lack of migrant workers have contributed to the rise in cotton prices, and may lead to a shortage in the future.

 

Mukherjee’s company, Global Impex USA, partners with Umed Group, a global fabric manufacturer based in India that has had to delay fabric shipments and manufacturing due to the spread of the new COVID-19 variant.

 

Global Impex USA is a Minnesota-based textile solutions company. It was founded in 2017 by Mukherjee and Bob Gazich, two professors from College of Saint Benedict, St. John’s University. From the beginning, said Mukherjee, the goal was to provide young college students from all diverse backgrounds the opportunity to learn about business in general and the textile trade in particular.

 

When they started in 2017, they only had one student intern. Now, the company has grown to a team of 20 interns from St. John’s, St. Cloud State University, University of Minnesota – Twin Cities and Duluth, University of Wisconsin-Madison, University of Michigan, University of St. Thomas, DePaul University and Sonoma State University. All of their interns are working remotely from Minnesota, Michigan, Boston, Chicago, San Francisco, Puerto Rico and more. Their team also includes international students from India, Sri Lanka, Italy and Vietnam.

 

Source: Global Impex USA

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