Cotton prices have hit an all time high as demand from China coupled with shrinking global supplies of the commodity continues.
The price of cotton has gone above $2 (£1.24) a pound for the first time, prompting fears of further rises in the price of clothing, as cotton mills attempt to buy ahead of the deadline for March deliveries.
Cotton prices have risen more than 40% since the beginning of the year mainly due to increasing demand from the world’s biggest fibre consumer, China, combined with shortages bought about because of poor cotton crops in Pakistan and export restrictions in India.
Some clothing manufacturers such as Levi Strauss have already raised prices, while retailers such as H&M have blamed a drop in recent profits on the soaring cost of cotton.
Earlier this year the Swedish fast fashion chain said its profit before tax in the three months to November 30, was down 11% on a year earlier.
Prices are expected to ease next week, after the deadline for March deliveries has passed, but the market could see a further hike when the deadline for May contracts approaches.