The price gap between imported and domestically produced cotton yarn is being repriced. In early September 2026, overseas offers from major Southeast Asian spinning nations fell across the board, while Chinese mills held firm during the traditional peak season. The resulting landed-cost differential has widened to a level rarely seen in recent years. This is not merely price volatility; it is the outcome of misalignment among global cotton costs, shipping expenses and domestic inventory cycles.
Why Overseas Offers Loosened
Feedback from traders in Guangdong, Jiangsu, Zhejiang and Fujian indicates that ICE cotton futures have undergone significant volatile corrections since late August, directly eroding the cost support for imported yarn. Meanwhile, domestic cotton prices in India and Pakistan fell for consecutive sessions in early September, further lowering the floor for South Asian spinners.
Geopolitical factors cannot be ignored. Renewed US-Iran tensions have disrupted crude oil and natural gas prices, bringing back additional costs in shipping and trade. Cotton product orders and exports from Southeast Asian countries have been noticeably constrained. To protect shipment volumes, spinners have had little choice but to concede on overseas quotations.
By category, open-end yarns and coarse-count ring-spun yarns saw relatively larger cuts, while carded yarns of C32S and above, along with medium-high count combed yarns, adjusted by smaller margins. Indian JC60S and JC80S remained weakly stable due to scarce bonded and shipment listings and persistently high costs. This suggests the core driver of this round of price cuts comes from inventory pressure and order competition in medium-low count yarns, rather than a collapse in demand across all categories.
Where Vietnamese Yarn's Competitiveness Comes From
Vietnamese OEC10S to 21S FOB and CNF offers are currently slightly lower than those from India, Pakistan and Indonesia, giving them a notable competitive edge. Coastal enterprises in Guangdong, Fujian and Zhejiang producing denim, knitted underwear, knitted fleece, home textiles, corduroy and labor protection products have shown markedly increased interest in these yarns.
This preference is no accident. End products corresponding to medium-low count yarns are largely categories balancing domestic and export demand, with highly fragmented orders and high sensitivity to raw material costs. Vietnamese yarn's combined advantages in price and delivery schedules precisely match the current export structure, where short, scattered and small orders account for a high proportion.
Notably, after some large-scale, branded spinners took the lead in cutting overseas offers, second- and third-tier brands were forced to follow suit. This tiered price reduction means overseas quotations still have惯性 downward room in the coming weeks, though the extent will depend on whether ICE cotton futures can stabilize.
The Confidence and Risks of Domestic Mills Holding Prices
Domestic cotton yarn quotations have not followed Zhengzhou cotton futures and spot cotton prices downward. A few large-scale mills even raised ex-factory prices for open-end yarn. The core reason is that after the arrival of the Golden September and Silver October peak season, mills have accelerated inventory depletion, easing short-term financial pressure and strengthening their willingness to hold prices.
But holding prices is a double-edged sword. The landed cost of imported cotton yarn continues to widen its premium over domestic quotations, making imported yarn increasingly economical for downstream weaving, fabric and garment factories. If domestic mills maintain current quotations, the recovery in demand for medium-low count Vietnamese, Indian, Pakistani and Bangladeshi yarns along the coast will strengthen further.
From a supply chain transmission perspective, active trading in imported yarn means the weaving segment is actively adjusting its raw material mix. For domestic mills, the real risk is not short-term price but the systematic substitution of medium-low count products by imported yarn in order structures.