BY JESSICA LIM

EVERYTHING cotton from underwear

to school uniforms is becoming more
expensive.
The reason: high cotton prices across
the globe, brought on by floods in major
producing countries in the last growing
cycle. Small and mid-range manufactur-
ers and retailers of cotton products,
faced with a more expensive raw prod-
uct, have been stretched thin. They now
have to raise prices, they say.
NP Marketing, which makes and sup-
plies uniforms to about 30 kindergartens
and childcare centres, has upped prices
for a quarter of its customers. Its new
prices, which are up to 20 per cent high-
er, apply to customers who make smaller
orders, with other customers to be affect-
ed progressively.
A set of PE shorts and T-shirt, for in-
stance, now costs $9.50, up from $8.50
last month.
Prices have also edged up at Vee Gar-
ments Enterprise, Asia Garment Manu-
facturer and Sing International, three
other uniform makers.
Home-grown lingerie brand E2 Linge-
rie, which buys cotton fabric and makes
it into underwear in its factories in Chi-
na and Taiwan, is also increasing prices
for its cotton underwear by 20 per cent
next month.
The 16-outlet chain, which sells its
cotton panties at between $5 and $12 a
pair, sells tens of thousands of them eve-
ry month.
Its merchandising manager Tan Ai
Kiok said: Our cotton underwear are
made of almost pure cotton, with a bit of
spandex. We have to increase prices be-
cause costs have gone up too much.
Fabric retailers have also raised their
prices.
Chinatown fabric shop Lye Nai
Shiong now sells bales of cotton at $1.50
a yard, up from $1.20 last week. Owner
Janet Wong said she will soon raise the
price by another 30 cents.
Prices will go up again for our new
stock, she said. Her suppliers have al-
ready told her they will be raising prices.
At smaller supermarket chains like
Golden Bamboo Brothers Supermart,
which has outlets in Pasir Ris and Bedok,
prices of cotton wool, swabs and sani-
tary pads are also set to rise.
Its owner, Mr Winston Neo, said sup-
pliers had told them prices will be going
up soon.
An imbalance between supply and de-
mand has pushed benchmark cotton pric-
es up by more than 80 per cent since the
beginning of the year.
Several factors are in play, said indus-
try watchers.
Besides the floods in Pakistan and
north-eastern China shrinking stocks,
current supplies are low because demand
for cotton was weak during the reces-
sion, and much less cotton was planted
then. As for demand, cotton consump-
tion in Asia is on the rise.
First Capital Groups senior cotton an-
alyst Sharon Johnson, speaking to The
Straits Times from Atlanta in the United
States, said: Inventories ran low and
prices began to escalate. The situation es-
calated like a snowball rolling down a
hill. World cotton production is unlikely
to catch up with consumption for at
least two years.
She has this piece of advice to offer:
If people want cotton products, its
best they buy them now, instead of pay-
ing a premium later.
Most retailers are likely to start in-
creasing their prices in the first quarter
of next year, she added.
Larger companies tend to ink con-
tracts for cotton in advance, with
locked-in prices. It takes three to six
months for raw cotton to go through the
manufacturing chain: It has to be spun in-
to yarn first, then made into cloth,
which is loaded onto ships to be trans-
ported around the world.
It looks like a matter of time before
the big apparel-makers raise prices too.
Already, some big American players
such as Hanesbrands, The Jones Group
and VF Corp have announced that they
will raise prices for their clothing early
next year, by as much as 10 per cent.
Other brands like Levi Strauss & Co
and Marks & Spencer are holding prices
steady for now.
A Marks & Spencer spokesman said:
All retailers are currently facing in-
creased cost pressures from rising cot-
ton prices. Most of the industry expects
prices to go up in six to 12 months.
A Levi Strauss spokesman said in an
e-mail: We contract for fabric and fin-
ished products in advance, so pricing
changes in the marketplace would not be
visible to consumers until roughly six to
12 months later.
Some consumers are already stocking
up.
Ms Stella Lim, 48, is now glad that
when her youngest child entered kinder-
garten last year, she decided on the spot
to buy three extra sets of uniforms.
This means I dont have to pay more
for uniforms, the mother of three said.
Now Id better quickly go buy other
things like jeans.
Ms Johnson predicts that more syn-
thetic and blended clothing products will
make their way to shop shelves soon.
Its much easier for companies to
gear up and produce synthetic fibres to
keep prices under control. You are going
to see a lot more blended fibres like ny-
lon and polyester being used in the mar-
ket, she said.
limjess@sph.com.sg
Home-grown lingerie brand E2 Lingerie is one of the manufacturers and retailers increasing their prices following the spike in the value of raw
cotton. Some big apparel-makers are set to raise prices too, while others are absorbing the higher costs for now. ST PHOTO: TED CHEN
Floods, supply-demand
imbalance trigger hike;
lingerie prices up too
Uniforms to cost more
as cotton prices soar
TOMORROW IN
Rich pickings
next year
for
wedding
industry
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THE STRAITS TIMES SATURDAY, NOVEMBER 13 2010 PAGE B8