Money is made of cotton

Once Valledupar's main economic produce; Cotton

Image via Wikipedia

Did you know that U.S. paper currency paper is composed of 75% cotton (and 25% linen)?

Each note (depending on its denomination) has a life expectancy of between 2 and 6 years.

The U.S. Mint prints approx. 38 million paper notes per day. Annually, the weight of this money would equal 28 million pounds (or 12.7 million kilograms or the weight of seventy-four Boeing 747 airplanes).

Proportionately, cotton should account for 21 million pounds of this weight which is less than 0.5% of the annual U.S. cotton production alone.

More practically, approx. 55 trillion pounds of cotton is produced around the world globally. India and China are the two largest producers accounting for nearly 60% of this crop.

Some of the supply and demand story includes: cotton’s demand increases when developing countries grow richer (and most of these nations are in tropical climates), India and Pakistan are 2 of the world’s top 4 producers (where political tensions are on the rise) and it’s water intensive.

The price of cotton spent most of the past 30 years trading between 50 cents & $1 per pound, however commencing mid-2009 up to April 2011, the price rose from 60 cents to above $2 per pound.

In the past 3 months, the price of cotton has halved to US$1.03 per pound.

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