Signs of Dynamic Change as Blockchain and AI Help Trace Xinjiang Cotton

There are indications of a change in the dynamics of the global textile industry on the ground due to the entry into force of the US embargo on cotton from the Xinjiang region. This is because international brands are able to monitor and implement a comprehensive and effective ban on cotton produced in the Xinjiang region using the latest technologies like blockchain and artificial intelligence (AI).

Several companies like TrusTrace, SupplyShift, and TextileGenesis have developed technologies that use blockchain and AI to trace the supply chains of fashion brands. Brands can use the platforms provided by these companies to power all of their purchase orders and certifications. Industry sources said brands must show a full digital chain of custody to conclusively prove the absence of Xinjiang cotton. If a brand perfectly controls its supply from the farm, it will not be impossible to trace a gene using the latest technologies.

An industry expert said Fibre2Fashion“US authorities have complete information on the genes of cotton produced in Xinjian. Technology has facilitated the traceability of the gene throughout the value chain. He said that if an exporter buys yarn from any country , and if the raw material, i.e. the cotton of a particular batch of yarn, is from the Xinjiang region, then the gene of origin is fully traceable. IA, tech companies can conclusively prove that a particular batch of yarn or garment is made from cotton produced in the Xinjian region of China or not.

There are indications of a change in the dynamics of the global textile industry on the ground due to the entry into force of the US embargo on cotton from the Xinjiang region. This is because international brands are able to monitor and implement a comprehensive and effective ban on cotton produced in the Xinjiang region using the latest technologies like blockchain and artificial intelligence (AI).

Industry sources have indicated that there is a sense of unease among exporters who use raw materials imported from various countries. If the gene from the Xinjiang region is found in finished products at US ports, authorities will impose a heavy fine. Therefore, a number of tech companies have geared up to provide services to apparel brands in the US market. These brands trace the entire value chain with the help of technology companies. These brands import garments from various exporting countries and therefore need to monitor supplies not only from China but also from other countries, as exporters may use raw materials imported from any other country.

China’s cotton ban has already influenced cotton prices. Chinese cotton is losing ground due to slowing demand. While the export of fabrics, yarns and cotton produced in other countries is growing. It is therefore highly possible that the global textile value chain will undergo a paradigm shift due to this development.

With 24.73% market share, China was the largest apparel supplier to the United States in 2021. According to TexPro, the Fibre2Fashion market analysis tool, Vietnam (17.26%), Bangladesh (8.33%), India (5.11%) and Indonesia (4.04%) were the other four main suppliers to the United States. However, China’s share fell to 20.90% in the total US apparel imports of $49.755 billion in the first half of 2022. On the other hand, the share of the next four apparel supplying countries increased over the period. Vietnam’s share increased to 18.28%, Bangladesh’s to 9.65%, India’s to 6.47% and Indonesia’s to 6.07%. Thus, China’s declining share of US apparel imports leads to an increase in the share of other Asian countries, indicating a dynamic change in global textile production and trade.

Fibre2Fashion (KUL) News Desk


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