Shoppers warned era of cheap clothes at an end

Over the past few years the UK market has been flooded with cheap clothing from abroad, leading to a "wear it for one season only" mentality to fashion.

But yesterday Next, the UK's second biggest fashion retailer, warned that rocketing cotton prices could lead to almost double digit price hikes.

The group, second to Marks & Spencer on the UK high street, said retail prices could rise by as much as eight per cent in the first three months of 2011 and could go even higher in the spring.

Fashion retailers across the sector have raised the alarm over prices in recent months, including budget clothing giant Primark.

Cotton prices are running at record highs as global supplies have tightened after the devastating floods in Pakistan – one of the world's largest cotton growers – and wet weather in China, which is another major exporter.

The price hike will come at the worst time for retailers, with the New Year VAT hike to 20 per cent already making clothes more expensive.

Many retailers fear that the 81bn of spending cuts announced by the Government last month, as well as tax rises and a slowing housing market, will also hit consumer demand.

Last week Marks & Spencer said the Christmas trading period would be "hard fought, but OK", while earlier this week John Lewis raised its forecast for second-half sales growth.

While shoppers will find it hard to cope with the price increases, environmental groups have been calling for a change to the throwaway attitude to clothing.