Clothing prices in Bangladesh in 2026: what is pushing costs

Clothing prices in Bangladesh are being pushed up from several directions in 2026, while the prices buyers actually pay have been falling. On the cost side, electricity for industry rose by about 18–19% from June, factories have paid for diesel to keep running through power cuts, cotton is about a quarter dearer than a year ago, container freight out of Asia costs well over twice what it did in October 2025, and the government has started forming a new minimum wage board. The taka has barely moved since 2025, so it no longer softens any of this. On the price side, the average price of US clothing imports from Bangladesh fell 1.73% in January to August 2026, and the EU’s fell 8.94% in the first half. This guide gives each driver with a dated figure and its source, and what it means for the quote you receive. We checked it on 17 October 2026; read the date beside each figure.

Wages: Tk 12,500, a 9% increment and a new wage board

The legal minimum wage for a garment worker has been Tk 12,500 a month at the entry grade since 1 December 2023, about US$101 at Bangladesh Bank’s weighted average rate of Tk 123.45 on 17 October 2026. On top of it, a 9% annual increment has applied since 1 December 2024: the government added four percentage points to the 5% set in 2023, by a notification issued on 5 January 2025, The Business Standard reported. Our wages guide has the rate for each grade, how the increment works and the history since 2006.

The next reset has started. On 15 October 2026 The Business Standard reported that the Department of Labour had written to owners’ and workers’ organisations asking for nominations to the garment wage board, a body of six members. The Bangladesh Labour (Amendment) Act 2026, dated 10 April 2026, which carried over a rule first made by ordinance in 2025, requires the minimum wage to be reviewed every three years rather than five, and three years will have passed in December. Workers blocked roads in Uttara that week to demand a minimum of Tk 30,000 a month, about US$243; a BGMEA vice-president called the protests an attempt at sabotage. Tk 30,000 is a demand, not a proposal: when we checked, the board had not been formed and no rate had been put forward. On 7 October the same paper reported that the president of BKMEA, the knitwear exporters’ association, said it was not the right time to raise wages, and that the last review took about six months from forming the board to publishing the rates.

What a new minimum does to a garment price depends on how large the step is. Wages sit inside the cost of making, a line that also covers overheads. In a 2023 study of cost sheets from four Bangladeshi factories, published in the Journal of Textile Science and Technology, cost of making was 15.2% of the FOB price of a basic t-shirt and 23.5% of a woven shirt. So even if every taka of the cost of making were wages, a 10% rise in the wage bill would add about 1.5% of that t-shirt’s FOB price to the factory’s costs, and 2.4% of the shirt’s. Priced through the study’s own cost sheets, which add commercial and transport costs, the buying-house commission and the factory’s profit as percentages, it would raise the FOB price by about 1.9% and 3.0%. That is our arithmetic on the study’s figures. Construction-heavy styles feel a wage rise more than simple knits: the study counts more than forty sewing operations in the shirt and twelve in the t-shirt.

Electricity and gas: higher tariffs, and the cost of working without gas

Electricity was the largest tariff change of 2026. On 3 June the Bangladesh Energy Regulatory Commission (BERC) raised the average retail price by 16.68%, from Tk 9.11 to Tk 10.63 per kWh, from the June billing cycle; The Daily Star reported rises of 18 to 19% for small and large industries, with demand charges unchanged. A day later BERC withdrew the increase for households using up to 75 units a month, which brought the average retail price down to Tk 10.40, about 14% above the old rate; the rises for every other category, industry included, stayed in force. The president of BTMA, the textile mills’ association, told The Business Standard the rise could raise overall production costs by around 10%. That is an industry estimate, not a measured figure.

Grid gas prices for industry have not changed in 2026, as far as we found. The last step was BERC’s order of 13 April 2025, which raised gas for new industrial connections from Tk 30 to Tk 40 per cubic metre and for new captive power plants, the gas generators many factories run, to Tk 42. As bdnews24.com summarised the tariff on 1 August 2026, older industrial connections pay Tk 30 for up to half their permitted load and Tk 40 above it, and older captive users Tk 31.50 for the first half. Pressure for more is building: Petrobangla, the state gas company, paid an average Tk 31.65 a cubic metre for domestic and imported gas in the 2025–26 financial year and sold it for an average Tk 23.63; in April to June 2026, when imported gas cost more, its purchase price averaged Tk 45.79. Its mid-2026 proposal to raise prices covers gas for power stations and vehicles, not industry, and any change needs a BERC public hearing first.

The larger cost has been the energy factories could not get. When gas or grid power ran short, factories paid for diesel to keep machines running, and lost hours of production. In Chattogram, The Business Standard reported on 2 May 2026, the director of one garment factory said it used to need about Tk 19,000 of diesel a day in summer, with about two hours of power cuts, and now spent about Tk 40,000 a day, with three to four hours of cuts and diesel 15% dearer. In the same report a former BGMEA vice-president said higher freight charges, inland depot charges and transport fares had pushed overall production costs up by more than 20% in two months. The US Department of Agriculture’s office in Dhaka reported in April that gas shortages had cut spinning mills’ capacity to 40% and raised their overhead costs by 30%. These figures come from the industry, not from audited accounts, but they point the same way. Our sourcing risks guide covers what the shortage does to delivery dates and how buyers plan around it.

The taka: steady, so it no longer cushions rising costs

Bangladeshi garments are sold in US dollars, while wages, electricity and gas are paid in taka. When the taka falls, those taka costs shrink in dollar terms, which in past years absorbed part of each wage rise. On 8 May 2024 Bangladesh Bank moved to a crawling peg and the dollar went from Tk 110 to Tk 117 in a day, Prothom Alo reported. On 14 May 2025 the governor said the rate would from then on be set by market forces. Since then it has hardly moved: Tk 121.69 at the end of August 2025, according to Bangladesh Bank’s figures reported by The Daily Star, and Tk 123.45 on 17 October 2026. That is a fall of about 1.4% in the taka, so in 2026 a rise in taka costs reaches a dollar price almost in full.

The exchange rate does not move the dollar cost of what factories import: cotton, yarn, much of their fabric, trims and the liquefied gas that fills the gap in supply are bought in dollars. The earlier fall still weighs on factories, though. USDA’s Dhaka office reported in April that the taka’s sharp depreciation had cut working capital by an estimated 35%, making it harder for smaller factories to open letters of credit for raw materials. For a buyer in Australia, Canada, New Zealand, the UK or Europe, the exchange rate that moves your own cost is your currency against the dollar, not the taka.

Cotton: about a quarter dearer than a year ago

Bangladesh grows very little cotton and imports nearly all it spins. USDA’s Dhaka office forecasts imports of 7.7 million bales in 2026/27 against a crop of 153,000 bales, so world prices reach a Bangladeshi fabric price directly. The Cotlook A Index, the benchmark price for cotton delivered to mills in the Far East, stood at 90.65 US cents a pound on 8 October 2026, as published in USDA’s Weekly Cotton Market Review. The same report put the US base-quality spot price at 75.08 cents for the week, against 60.88 cents a year earlier, and the ICE December futures contract at 79.94 cents, against 64.47 cents in October 2025: rises of 23% and 24%. Earlier in the year cotton was cheap: merchants quoted lint cotton to Bangladeshi mills at an average 82 cents a pound in February 2026, 2.62% less than a year before, USDA reported.

Fibre is only part of what fabric costs. Spinning, knitting or weaving, dyeing and finishing make up the rest, and those stages are where the energy costs above land. Fabric itself was between 38% and 52% of the FOB price of the four basic garments in the 2023 study. Spinning mills hold one to two months of cotton stock, USDA reports, so a move in the cotton price reaches yarn and fabric within a season, not overnight. Synthetic fabrics follow oil and chemical prices instead; this guide does not track them. Our cotton traceability guide covers where the cotton comes from.

Freight: the Suez route is reopening, but rates are far above 2025

An FOB price stops at the port in Bangladesh, so freight is not in it. It is in a CIF or DDP price, or on your forwarder’s invoice, and it has moved more than any other cost in the past year. Drewry’s World Container Index stood at US$4,485 per 40-foot container on 15 October 2026, against US$1,687 on 16 October 2025. Shanghai to Rotterdam was US$3,522 (US$1,669 a year earlier), Shanghai to Los Angeles US$7,884 (US$2,195) and Shanghai to New York US$10,075 (US$3,236). Drewry does not index Chattogram. Bangladeshi cargo usually connects at a hub such as Colombo or Singapore onto these same mainline services, so read the index for direction, not as a rate for your booking. In April, USDA’s Dhaka office also reported emergency fuel surcharges of US$320 per 40-foot container after the de facto blockade of the Strait of Hormuz from 28 February 2026.

One change may ease rates. BIMCO reported on 14 October 2026 that container ship capacity through the Suez Canal averaged 753,000 TEU a week in the first two weeks of October, against 1,457,000 in the same weeks of 2023: the first time transits have passed half their level from before the Red Sea attacks. Ships that no longer sail around the Cape of Good Hope shorten voyages to Europe and the US east coast and free capacity, but nobody can date a full return. Transit times by port are on our US, UK and EU market pages, and our sea vs air guide shows when air is worth paying for.

Duty: the US adds 10%, Europe and the UK hold for now

Duty is paid on arrival, so it changes your landed cost rather than the factory’s price. Since 24 July 2026 the United States has charged a Section 301 tariff of 10% on products of Bangladesh, with listed exceptions, against 12.5% on products of China and Vietnam, according to the US Trade Representative’s notice in the Federal Register; our US tariff guide gives the total by garment. Bangladesh is scheduled to leave the UN’s least developed country category on 24 November 2026. ECOSOC asked the General Assembly to act on Bangladesh’s request for a longer preparatory period before that date, and the UN’s LDC portal recorded no decision when we read it on 17 October 2026. Duty-free access does not end on that date: the European Commission says Bangladesh keeps Everything But Arms at least until the end of 2029, and under the UK’s Developing Countries Trading Scheme a graduating country has three years before it moves to Enhanced Preferences. Our LDC graduation guide sets out each market.

What buyers are paying: unit prices have fallen

Import statistics show prices moving the other way. The average unit price of US clothing imports from Bangladesh fell 1.73% in January to August 2026, a smaller fall than China’s 9.93%, according to OTEXA data reported by The Business Standard on 7 October. In the EU, imports from Bangladesh fell 16.43% to €8.64 billion in the first half of 2026, with volume down 8.22% and the average unit price down 8.94%, according to Eurostat data reported by The Financial Express on 16 August. A unit value mixes products, so a fall can mean buyers chose cheaper styles as well as paying less for the same one; our US imports analysis explains the measure.

Factory owners say the gap is coming out of their margins. On 7 October BKMEA’s president said production costs were rising without matching prices from buyers, and in April USDA’s Dhaka office expected continued pressure from buyers for lower unit prices. For a buyer, a squeeze like this shows up in two ways: requests to reprice at the next order, and quieter savings, such as a lighter fabric, a cheaper mill or an unapproved subcontractor. Our red flags guide and factory verification guide show how to check for them.

What this means for your quote

• Ask how long the price holds, and what it assumes. A quote is built on today’s fabric, trims and wages. If your goods will be made after a new minimum wage could take effect, agree in writing whether the price holds, and fix the unit price, currency and dates in a purchase order before production starts.
• Compare on the same shipping term. Freight is the cost that has moved most, so a CIF or DDP quote from last year is out of date, while an FOB price is not affected. Our FOB vs DDP guide explains the difference.
• Approve fabric early. Fabric is the largest line in the costing and the one exposed to cotton and energy prices. The sooner it is booked, the sooner its price is settled, and the sooner the stage most exposed to gas shortages starts.
• Price the landed cost, not the factory price alone. Put the FOB price, a current freight quote and your market’s duty into the landed cost calculator, and for goods landing after 2029 try the duty that would follow graduation as well.
• Question a price that has fallen while costs rose. If a quote for the same specification is lower than last season’s, ask what changed: the fabric weight, the mill or the factory doing the sewing.

Our starting prices for 15 product categories, confirmed on 19 September 2026, are in our cost guide with the cost sheet behind them, from US$4.50 for a basic t-shirt. Every quote is priced for a particular style, quantity and date. Tell us what you want to make: we reply within one working day, and our own orders start at 500 pieces per style and colour.