Pakistani Yarn Gains Ground: Shifting Dynamics in China's Cotton Yarn Imports, Open-End Spinning Under Pressure

In May 2026, China imported 172,200 tons of cotton yarn, down 14.03% month-on-month, but imports from Pakistan reached 21,310 tons, edging up 0.01% from April and surging 80.36% year-on-year. Pakistan was the only major source country to post positive monthly growth, while Vietnamese and Indian supplies fell 11.83% and 29.38% respectively.

Drivers Behind Pakistan's Growth Pakistan's strong performance is no accident. The Pakistani rupee's continued depreciation against the U.S. dollar directly lowered export prices, boosting competitiveness. Weak domestic demand also pushed mills to seek overseas outlets, with China as the top destination.

Geopolitical factors also played a role. Conflicts involving the U.S., Israel, and Iran redirected some low-margin, low-count textile orders from Southeast Asia back to China. These orders are highly cost-sensitive, and Pakistani yarn fits their price and quality profile. The bilateral trade in cotton yarn and fabric has deepened, supported by stable cotton blending and shorter shipping distances.

Open-End Yarn: Volume and Price Both Fall In contrast, open-end spinning yarn is suffering a dual decline. Weaving mills and traders in Guangdong, Jiangsu, Zhejiang, and Shandong report sluggish inquiries and deals for bonded and forward cargoes.

The immediate cause is the tail end of order transfers from Southeast Asia, coupled with the absence of domestic winter-spring orders. More critically, expectations of new U.S. tariffs under Section 301 in July have made buyers cautious. FOB/CNF/CIF quotes from Vietnam, Indonesia, Malaysia, and India have edged down, but transactions remain thin.
## Supply Chain and Price Outlook
Pakistan's domestic cotton prices dropped sharply in mid-June, and with power supply improving, mill operating rates are rising, adding to export pressure. This suggests further downside for Pakistani yarn prices. A Zhejiang trading firm noted that some traders are waiting for better buying opportunities, expecting Q3 imports to climb.

For Chinese mills, Pakistani yarn's cost advantage is reshaping procurement. 8S-21S siro-spun yarn is still moving steadily, showing resilience in low-count segments. The weakness in open-end yarn reflects a market aversion to high-cost, high-tariff varieties.

Practical Recommendations ### For Buyers - Monitor the Pakistani rupee's exchange rate; consider locking in forward contracts during depreciation cycles. - Delay restocking of open-end yarn until July's tariff policy is clear to avoid inventory losses. - Increase substitution of Pakistani yarn for Vietnamese and Indian low-count yarn, especially 8S-21S siro-spun.

For Trading Companies - Adjust import mix to favor Pakistani yarn, leveraging China-Pakistan FTA benefits. - For orders diverted from Southeast Asia, explore blending Pakistani yarn with domestic yarn to balance cost and quality. - Stay updated on U.S. Section 301 developments and negotiate risk-sharing clauses with downstream clients.