In May 2026, China's cotton yarn imports totaled 172,200 tons, a sharp 14.03% decline month-on-month, but still an impressive 71.75% increase year-on-year. While the overall volume remains high, a structural shift is underway: imports from Vietnam and India fell 11.83% and 29.38% respectively, while Pakistani yarn imports reached 21,310 tons, flat month-on-month but surging 80.36% year-on-year, making it the only source market to buck the trend.
This shift is driven by multiple forces. First, geopolitical tensions—the US-Israel-Iran conflict has redirected some low-margin, low-count apparel orders from Southeast Asia back to China, benefiting Pakistan. Second, the Pakistani rupee's sustained depreciation against the US dollar gives its mills greater pricing flexibility. Third, weak domestic demand in Pakistan has pushed mills to export more, while improved energy supply has boosted capacity utilization. Fourth, the China-Pakistan cotton yarn trade channel has matured, with stable cotton blending and shorter transit times offering clear advantages over Southeast Asian suppliers.
In contrast, the open-end spinning market is under pressure. Mills and traders in Guangdong, Jiangsu, Zhejiang, and Shandong report sluggish inquiries and transactions for both bonded and forward open-end yarn. The fading of Southeast Asian transfer orders and the absence of domestic winter-spring orders have dampened demand. Additionally, expectations of new US tariffs under Section 301 in July are curbing stockpiling. Prices for open-end yarn from Vietnam, Indonesia, Malaysia, and India have already edged lower.
For buyers, this creates a window of opportunity. Pakistani 8S-21S SIRO yarn remains competitive, and the recent drop in Pakistani cotton prices further improves its cost-effectiveness. However, the open-end market may be nearing a bottom, suggesting that buyers should lock in prices before a potential rebound.