In May 2026, China imported 172,200 tons of cotton yarn, down 14.03% month-on-month but up 71.75% year-on-year. A notable structural shift: Pakistani yarn imports edged up 0.01% month-on-month and surged 80.36% year-on-year, while imports from Vietnam and India fell 11.83% and 29.38%, respectively. This resilience is not accidental but driven by multiple industrial factors.
The Underlying Logic of Pakistani Yarn's Rise
The core driver of Pakistani yarn's competitiveness lies in exchange rates and costs. The continuous depreciation of the Pakistani rupee against the U.S. dollar has lowered export prices, making Pakistani yarn more attractive in the global low-count segment. Meanwhile, easing energy supply crises in Pakistan have raised mill operating rates, increasing export pressure. Stable cotton blending and shorter shipping distances offer Chinese fabric mills better delivery control and quality consistency. Conflicts in the Middle East have also redirected some low-margin apparel orders from Southeast Asia back to China, indirectly boosting demand for Pakistani yarn. Weak domestic demand in Pakistan has further pushed mills to focus on exports.
Signals from Falling Volumes and Prices in Open-End Spun Yarn
Customs data and market feedback show that open-end (OE) spun yarn is facing simultaneous volume and price declines. FOB/CNF/CIF quotes from Vietnam, Indonesia, Malaysia, and India have been trending down, with inquiries and transactions for bonded and forward cargo slowing significantly.
Three factors explain this:
- The transfer order wave from Southeast Asia is winding down, reducing short-term demand;
- Domestic winter-spring orders have yet to materialize, leaving demand without support;
- Expectations of U.S. tariff hikes under Section 301 in July have curbed importers' willingness to stock up.
In contrast, Pakistani 8S-21S siro spun yarn shipments remain relatively resilient, highlighting its irreplaceability in specific categories.
Reactions from Industrial Clusters and Procurement Adjustments
Fabric mills and yarn traders in Guangdong, Jiangsu, Zhejiang, and Shandong report a cautious procurement stance. Amid falling OE yarn prices, some mills are holding cash, waiting for opportunities to replenish Pakistani yarn. A Zhejiang-based textile import-export company noted that sharp declines in Pakistani cotton prices, combined with rupee depreciation expectations, offer more room for negotiation in future purchases.
Regionally, Guangdong's denim cluster has rigid demand for low-count OE yarn, while Jiangsu and Zhejiang's home textile and apparel fabric makers focus more on siro spun yarn supply stability. Pakistani yarn holds competitive advantages in both segments.
Long-term Impact on Southeast Asian Spinning Landscape
Pakistani yarn's sustained growth is reshaping the country structure of China's cotton yarn imports. Vietnam and India have long dominated the top two spots, but Pakistan's share is rising fast. In May 2026, Pakistani yarn accounted for 12.37% of total imports, close to India's 13.02%.
This trend implies:
- Vietnamese spinners will see further profit compression in low-count segments, potentially forcing a shift to higher counts or differentiated products;
- Indian yarn, hampered by domestic cotton price volatility and export policy uncertainty, will lose competitiveness;
- If Pakistan maintains its currency and energy cost advantages, it could become a pricing center for low-count cotton yarn within 6-12 months.