Introduction

Thailand is one of the countries which participates in the complete textile industry chain from upstream to downstream. The country possesses large, medium and small-scale industries for synthetic fibres as well as natural fibres. Thai manufacturers are more focused on the in-house production of cotton yarn and fabric with increasing modern technology and machinery.

Thailand meets the standards of the European Union and the United States of eco-friendly wet processing practices. Manufacturers use chemicals which are not harmful either to humans or to the environment. The researchers of the country are well-known in the world of textile and fashion industry, developing innovations such as anti-bacterial fabrics made from polyester mixed with coconut charcoal powder, heart rate monitoring jackets, solar-powered jackets, anti-bacterial nylon socks, anti-bacterial/anti-dust mite/herb-coated bed sheets and special jackets for extremely cold weather.

Cotton Production

The cotton production in Thailand is not significant as the returns are not attractive as compared to the returns from other field crops like corn. Total production of cotton in the country is less than one per cent of total demand. The government of Thailand does not promote the production of cotton and does not provide any kind of incentives to farmers. Also, the plantation of all transgenic (biotech) plant varieties, including cotton has been banned in the country. As the cotton production is not much significant in the country, the manufacturers of cotton yarn and fabric are more focused in the cotton imports for domestic consumption and export purpose.

Thailand Cotton Statistics

Source: TexPro & USDA

Cotton Import and Export

The cotton import of Thailand was 255.83 thousand tonnes in MY (marketing year) 2018/19, rose from 250.17 thousand tonnes in MY 2017/18 with a growth rate of 2.26 per cent. It is expected to increase to 269.56 thousand tonnes in MY 2021/22 with a CAGR of 1.76 per cent from MY 2018/19 in anticipation of gradual increase in cotton and cotton-blended yarn production. The total domestic cotton consumption in the country was 255.83 thousand tonnes in MY 2018/19 and expected to move up to 271.06 thousand tonnes in MY 2021/22 with a CAGR of 1.95 per cent from MY 2018/19.

This slower growth of cotton business is in line with the expected slower economic growth of the country in MY 2019/20. According to the Bank of Thailand, the country's economic growth in 2019 was revised down to 3.80 per cent from the previous forecast of 4 per cent. It was lower than the 4.10 per cent economic growth of 2018 due to reduced export growth caused by slower global economy. In addition, the Thai economy is expected to grow by 3.90 per cent in 2020 which is still slower than the economic growth in 2018. Thus, cotton exports of Thailand are not significant.

Cotton Imports by Supplier Countries

Source: TexPro & USDA

The US, Brazil and Australia are the major suppliers of cotton to Thailand. The total import of cotton from the US was 90.29 thousand tonnes in MY 2018/19 and expected to move up to 115.33 thousand tonnes in MY 2021/22 with a CAGR of 8.50 per cent. An import of cotton from the US is expected to increase as the medium-scale spinning mills have started diversification of cotton yarn production from coarse-count yarn to medium and fine-count yarn, and domestic coarse-count yarn cannot compete with imported yarn.

Machinery for Thailand's Textile Industry

Source: TexPro & USDA

Cotton Yarn Production

Source: TexPro & USDA

Cotton yarn accounted for 30 to 40 per cent of the total yarn production of the country and it is expected to surge consistently in the future. The cotton yarn produced in 2018 was 287.14 thousand tonnes and it is expected to increase to 309.22 thousand tonnes with a CAGR of 2.50 per cent from 2018. 

The continuous increase in production of the cotton yarn indicates the re-opening of previously closed spinning mills. According to the Ministry of Industry's Department of Industrial Works of Thailand, the number of operational spinning mills have increased to 166 mills in the second half of 2018 compared to 161 mills in the same time span in 2017.

Cotton Yarn Import

Source: TexPro & USDA

India, China and Vietnam are the major cotton yarn suppliers for Thailand which together contributed to approximately 90.32 per cent of the total cotton yarn imported in the country in MY 2018/19.  Cotton yarn imported from India and Vietnam was 18,072.92 thousand tonnes and 7,934.23 thousand tonnes respectively in MY 2018/19 and is expected to grow to 30,073.46 thousand tonnes and 14,585.22 thousand tonnes in MY 2021/22 with a CAGR of 18.50 per cent and 22.50 per cent respectively from MY 2018/19.    

Cotton Yarn Export

China, South Korea and Japan are the major cotton yarn export destinations for Thailand which together accounted for 82.89 per cent of the total cotton yarn exported from the country. Cotton yarn exported from the country has decreased due to increase in the production and export of cotton fabric and garments.

Source: TexPro & USDA

Cotton Fabric Production

The share of cotton fabric in total fabric production of the country remained at 41.49 per cent in 2018 and it is expected to increase in the future. The cotton fabric produced in 2018 was 205.11 thousand tonnes and it is expected to reach to 311.94 thousand tonnes with a very high CAGR of 15 per cent from 2018. 

Source: TexPro & USDA

Cotton Fabric Import

Source: TexPro & USDA

China and India are the major cotton fabric suppliers for Thailand which together contributed to approximately 91.20 per cent of the total cotton fabric imported in the country in MY 2018/19.  Cotton fabric imported from India was 10,042.53 thousand tonnes in MY 2018/19 and is expected to grow to 22,063.43 thousand tonnes in MY 2021/22 with a CAGR of 30 per cent from MY 2018/19. The fabric import has been increasing with increasing garments production particularly from India and Vietnam. The quantity of imported cotton fabric is only 15-20 per cent of the quantity of cotton fabric produced locally.

Cotton Fabric Export

Myanmar, Bangladesh, Japan, South Korea, Cambodia and Vietnam are the major cotton fabric export destinations for Thailand which together accounted for 59.63 per cent of the total cotton fabric exported from the country. Cotton fabric exported from the country to South Korea has been increasing with a very high CAGR of 20 per cent.

Source: TexPro & USDA