Strong demand, appreciation of Thai baht promotes increase in Thai cotton imports

Due to the strong demand for Thai cotton yarn, Thailand’s cotton imports increased to 27,800 tons in June 2010, a year-on-year increase of 7.1%. The top three import sources are Australia, Benin, and the United States.
In addition to strong domestic demand for yarn, the rise in the Thai baht exchange rate is also a major reason for the increase in cotton imports. In June 2010, the global average cotton import cost rose to 91.48 cents/pound, the highest level in 15 years, and Thailand’s average cotton import cost increased to 85.2 cents/pound, a record high. Still, Thailand’s cotton imports increased as the baht rose to its highest level against the U.S. dollar in more than two years. International cotton prices will tend to fall in the next few months, and cotton import costs may decline.