By  on June 7, 1994

NEW YORK -- With the dramatic increases in prices of raw cotton over the last year, man-made fiber producers are mobilizing for what they see as an opportunity to build market share. But they'll have to act quickly.

Starting in March 1993, prices for raw cotton began a rapid rise and last week zoomed past 82 cents per pound, a level that hasn't been seen in five years.

Manufacturers of polyester, rayon and acrylic -- cotton's three chief man-made-fiber competitors -- say that the price situation, along with product and technological advancements in their individual industries, could help them eat into cotton's 57 percent retail market share on a fabric-weight basis. That 1993 figure is based on consumer data garnered by National Purchase Diary, Port Washington, N.Y., a consumer research group.

At the end of 1993, according to industry executives, polyester's share of the market was 25 percent; rayon, 3 percent, and acrylic, about 5 percent.

Still, they also know the window of opportunity might only be open briefly. A larger cotton crop that's been predicted for next season could drive cotton prices back down. According to the National Cotton Council, next year's crop could rise to 17.7 million bales from the current 16.2 million bales. As reported, world cotton production last year fell to 76.7 million bales from 82.8 million bales in 1992, primarily due to insect infestation, disease and weather problems in three key cotton producing regions: China, India and Pakistan.

"If we should get even more increased acreage, you could start seeing some falloff in prices," said Jess Barr, an economist with the Council. Executives at manufacturers of man-made fibers also note that sales of cotton products have been bolstered substantially by the efforts of Cotton Incorporated, the research, advertising and promotional arm of U.S. cotton growers. Of Cotton Inc.'s 1993 budget of $45.1 million, nearly $22 million was earmarked for advertising and promotion.

"There's no question -- when there is a change in prices, either up or down, there are decisions to be made by mills," said Ira Livingston, Cotton Inc.'s vice president of U.S. marketing. "However, there is no correlation in price changes in raw cotton and cotton market share. Prices have gone from the low-60-cent range all the way into the 90-cent range without having an effect.

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