Night session data on June 26 sent a clear signal: cotton yarn (2609) closed at 22,210 yuan/ton, up 0.52%; cotton (2609) at 15,730 yuan/ton, up 0.32%; while polyester staple fiber (2608) fell to 6,936 yuan/ton, down 0.14%, and bottle-grade chips also dropped 0.21%. This divergence is not random—it reflects real-time cost transmission and procurement strategy shifts across the textile supply chain.
Cotton strength: supply contraction and restocking in industrial clusters
Cotton and cotton yarn gains are backed by fundamentals. China Customs data shows a tight quota release for cotton imports in 2026, while Xinjiang’s new-season planted area has shrunk by an estimated 3%-5% year-on-year. In weaving hubs like Shengze and Nantong, medium-sized mills began actively building cotton yarn inventories in mid-June to lock in relatively low costs. This restocking behavior amplified the night-session rally.
Notably, cotton yarn outpaced cotton (0.52% vs. 0.32%), indicating a marginal recovery in spinning margins. For mills with self-blending capabilities, the current cotton-to-yarn spread is near a three-month low, opening a hedging window.
Polyester weakness: crude oil drag and high inventory
The decline in staple fiber and bottle chips stems from upstream pressure. Brent crude fell below $75/barrel during the week, dragging down PX and PTA cost support. Although PTA edged up 0.04% in the night session, spot market activity remained sluggish. Industry data shows polyester plant finished goods inventory averaged 22 days as of June 25, above last year’s level; downstream weaving mills are purchasing on a hand-to-mouth basis.
The spread between 1.4D polyester staple fiber and grade 3128B cotton has widened to over 8,000 yuan/ton, a historical high. This gap is prompting some mills to increase cotton ratios in blended yarns to lower overall raw material costs.
Transmission: substitution effect and procurement windows
The cotton-polyester divergence is triggering chain reactions. Traders in Keqiao report rising inquiries for pure cotton greige fabrics, while orders for polyester-cotton blends are shortening. This suggests apparel brands may be adjusting fabric compositions for fall/winter collections in response to price gaps.
This pattern may persist through mid-July. Key watchpoints include:
- Xinjiang cotton squaring stage weather in early July
- Polyester plant operating rate cuts (current ~88%)
- Downstream fabric mill inventory days (currently ~12 days, below the 15-day safety line)