Pakistan's Open-End Yarn Gains Ground: Cost and Order Dynamics Reshape Import Structure

The landscape of China's imported cotton yarn is quietly shifting. According to the General Administration of Customs, China imported approximately 172,200 tons of cotton yarn in May 2026, down 14% month-on-month but up 72% year-on-year. The headline figure remains robust, but the monthly decline signals a cooling in restocking demand. More striking is the structural divergence: imports from Vietnam and India fell by 12% and 30% respectively, while Pakistani cotton yarn surged 80% year-on-year, defying the downward trend.

Structural Shift: Pakistan's Cost Advantage

Although Pakistan accounted for just 12.37% of total imports, its growth trajectory stands out. The depreciation of the Pakistani rupee has lowered the dollar-denominated cost of its yarn, while improved energy supplies have boosted mill utilization rates, increasing export pressure. Additionally, some low-to-mid count orders relocated from Southeast Asia due to Middle East tensions have flowed to Pakistan, further bolstering its market share.

Open-End Yarn Under Pressure, Siro Yarn Shows Resilience

Feedback from textile hubs in Guangdong, Jiangsu, Zhejiang, and Shandong indicates that open-end yarn is facing headwinds. Inquiries and transactions for bonded and forward cargo have slowed, and FOB/CNF/CIF quotes from Vietnam, Indonesia, Malaysia, and India are edging down. In contrast, Pakistan's 8S-21S siro yarn shipments remain relatively stable, supported by consistent cotton blending and shorter transit times. A trading firm in Zhejiang noted that Pakistani cotton prices have fallen sharply since mid-June, and mills are keen to export, but buyers are holding out for even lower prices.

Short-Term Gains vs. Long-Term Risks

Pakistan's current momentum relies on two factors: the tail end of order relocations from Southeast Asia and domestic export incentives. Both are temporary. The relocation wave is fading, and domestic winter-spring orders have yet to materialize, suggesting that incremental demand may peak within two months. A more persistent threat comes from U.S. trade policy, with potential tariff hikes under Section 301 expected in July, which could dampen overall import activity. Traders are already becoming more cautious with forward commitments.

Practical Recommendations

For Buyers - Monitor Pakistani cotton prices and rupee exchange rates; current levels still offer room for further declines. Consider phased purchasing to average costs. - Siro yarn from Pakistan offers clear cost-performance advantages for low-count applications; prioritize it over Vietnamese or Indian equivalents. - Prepare for a potential pre-tariff rush in July by securing shipping space and schedules early.

For Exporters - Take advantage of the current dip in Vietnamese and Indian open-end yarn quotes to renegotiate long-term contracts. - When sourcing from Pakistan, establish robust quality control standards, especially for cotton uniformity and tensile strength. - Keep a close watch on Middle East geopolitical developments, as they will continue to influence order flow into the second half of the year.