May's imported cotton yarn data reveals a notable structural divergence despite a monthly decline. According to customs statistics, China imported approximately 172,200 tons of cotton yarn in May, down 14.03% from April but up 71.75% year-on-year. The growth is far from uniform: Pakistani yarn has emerged as the primary driver, posting over 80% year-on-year growth, while traditional suppliers Vietnam and India both saw significant sequential declines.
Three Drivers Behind Pakistani Yarn's Counter-Trend Growth
Pakistani cotton yarn imports in May reached about 21,310 tons, flat month-on-month but surging 80.36% year-on-year, far outperforming Vietnam (down 11.83% month-on-month) and India (down 29.38%). This divergence is no coincidence. The sustained depreciation of the Pakistani rupee against the U.S. dollar has directly lowered export costs, giving Pakistani yarn a pricing edge over Southeast Asian alternatives. Meanwhile, weak domestic textile demand in Pakistan has pushed mills to redirect capacity toward exports, intensifying price competition.
Another critical factor is the redistribution of geopolitical orders. Conflicts in the Middle East have redirected some low-margin, low-count textile and garment orders from Southeast Asia back to China. These price-sensitive orders align well with Pakistani yarn's cost advantage. The growing 'two-way trade' in cotton yarn and fabric between China and Pakistan further reinforces this trend: Pakistani yarn benefits from stable cotton blending, shorter shipping distances, and more reliable delivery timelines compared to Vietnamese or Indian yarn.
Open-End Spinning Faces Dual Pressure, Siro-Spun Remains Bright Spot
In contrast to Pakistani yarn's overall performance, open-end spinning yarn is undergoing a significant adjustment. Feedback from weaving mills and traders in Guangdong, Jiangsu, Zhejiang, and Shandong indicates sluggish inquiries and transactions for both bonded and forward open-end yarn, with prices from Vietnam, Indonesia, Malaysia, and India continuing to edge lower. This dual pressure stems from a temporary lull: Southeast Asian transfer orders are winding down, domestic winter-spring orders have yet to materialize, and market concerns over potential U.S. tariff hikes under Section 301 investigations are keeping buyers cautious.
Pakistani 8S-21S siro-spun yarn, however, has maintained relatively active shipments. This category offers a balance of cost and quality in the low-count segment, effectively absorbing demand that has shifted away from open-end spinning. For small and medium-sized domestic weaving mills, siro-spun yarn delivers better fabric appearance and dyeing performance than equivalent-count open-end yarn, making it a preferred substitute in the current environment of short, urgent orders.
Wait with Cash or Stock Up?
A Zhejiang-based textile trading company reports that Pakistani cotton prices have corrected sharply since mid-June, while mill operating rates have rebounded as energy and power supply constraints ease, further increasing export pressure. The medium-term depreciation trend of the rupee suggests Pakistani FOB quotes still have room to decline. Domestic traders face a delicate balancing act: slow port inventory turnover ties up capital, yet further price drops could widen the safety margin for replenishment.
Looking ahead, the 'origin substitution' trend in the imported cotton yarn market is accelerating. Vietnamese yarn, constrained by high raw material costs and partial order backflow to China, will struggle to regain high growth. Indian yarn faces volatility from domestic cotton prices and export policy uncertainties, ceding market share to Pakistani yarn. If Pakistan can maintain its current price competitiveness and address occasional blending instability, it is well-positioned to further penetrate China's low-count yarn market.