U.S. Cotton Industry Competitiveness in the Context of the Cotton Supply Chain

Abstract

The U.S. cotton industry generates more than $25 billion in products and related services yearly, employing approximately 200,000 people in the various industry sectors from farms to textile mills (USDA, 2013a). Of the total cotton production in the United States, 75% is currently exported, leading to the importance of competitiveness of the U.S. cotton industry in a global setting. The United States has been the top cotton exporter in the world since 1989, accounting for nearly one-third of the world's cotton exports (USDA, 2013b). However, the market leadership has been consistently challenged, resulting in a significant decrease in the market share of the U.S. cotton export from 41.24% in 2004 to 26.70% in 2013 in the global cotton market (USDA, 2013b). Traditionally, the textile and apparel industries are considered an extended part of the cotton supply chain because textile and apparel industries have used and are using raw materials from the cotton industry to create final products for consumers at the final stage of the cotton supply chain (Rivoli, 2009). However, there has been little research to investigate how U.S. cotton industry competitiveness is affected in the context of the cotton supply chain. Based on this, there exists a need to understand the current competitiveness of the U.S. cotton industry, as well as how to improve this position on a global scale in the context of cotton supply chain. Therefore, the purpose of this research is to preliminarily explore factors that determine the competitiveness of the cotton industry in the context of cotton supply chain based on Porter's competitiveness factor model.