• Home
  • News
  • Business
  • California’s drought might lift clothing price tags

California’s drought might lift clothing price tags

By Angela Gonzalez-Rodriguez

loading...

Scroll down to read more

Business |ANALYSIS

As a result of the ongoing drought across California, main cotton production state together with the two Carolinas, denim retailers are cutting down water usage and exploring alternative, water-saving ways to manufacture clothing. Nevertheless, pricing of jeans and other fashion staples might rise in the next months should this drought continue, warn the industry.

The drought has not yet pushed Pima prices higher, thanks to a holdover of supply that still exists overseas and elsewhere, but higher prices could be coming.

"There's going to be some major impacts into our company, primarily as a result of the water problems that California is having," said to CNBC News Jeff Shafer, CEO of Agave Denim, which makes and processes denim jeans and other apparel in LA area factories and laundries. "I expect laundries will have less water available to them and will likely have price increases, or surcharges for water consumption."

California’s Pima cotton crop acreage is expected to decline for a fourth straight year to 110,000 acres, down from more than 250,000 acres five years ago, according to a USDA forecast provided to MarketWatch by trade group Cotton Inc.

California represents about 95 percent of the US Pima cotton – that used for denim and other clothing fabrics - production. It´s worth knowing that approximately 75 percent of the premium denim market comes from Southern California, according to the California Fashion Association, an industry trade group.

Pima cotton that is used in dress shirts and sheets, said Jon Devine, senior economist at Cotton Inc., as published the ‘Wall Street Journal’. “This is going to affect the Pima prices,” he said.

Levi’s, Guess, True Religion...looking for alternative denim production methods

Amongst other major fashion players subject to suffer the consequences of a longer-than-expected dry period are American Apparel, which is headquartered in Los Angeles and has cutting, sewing, knitting, manufacturing, dyeing and finishing facilities in the area; Agave, Guess, True Religion and Trina Turk.

California’s governor Jerry Brown ordered a 25 percent cut of the state’s water use through mandatory reductions on hundreds of local water supply agencies. “People should realize we are in a new era,” Brown said back then.

The four-year long California drought has moved the likes of Levi to take the helm in the quest for new procedures that save water and are more environmentally friendly. The veteran denim brand has been a pioneer in campaigning for a better usage of water in the textile industry, promoting the idea that jeans only need washing after 10 wears, the average American consumer washes after two wears.

American Apparel
Denim
Guess
Levi's