‘LVMH of China’ Faces Disruption to Its Cotton Supplies

Shandong Ruyi is facing serious disruption to its access to cotton supplies after the company, once hailed as the “LVMH of China”, was placed on an industry blacklist that will halt much of its trading in the commodity with major global groups, the Financial Times reported. Details from a recent arbitration case with a Bangladeshi group, in which Shandong Ruyi was ordered to pay compensation but has not, have also shone a spotlight on the extent of the Chinese company’s difficulties in paying off debts. The Liverpool-based International Cotton Association added Shandong Ruyi this month to its list of companies that have failed to pay arbitration awards connected to corporate disputes. That will bar association members, which include many of the cotton industry’s largest traders such as Cargill and Louis Dreyfus, from trading with the Chinese textile group. Read more