Pakistani Yarn Breaks Through as Open-End Spinning Faces Pressure: Import Cotton Yarn Landscape Shifts

China's imported cotton yarn market reached a critical inflection point in May. Total volume contracted 14% month-on-month but still surged 72% year-on-year. The real story lies in the structural shift: Pakistani yarn is seizing market share from Vietnam and India at an accelerating pace, while open-end spinning yarn faces a price and volume downturn.

Why Pakistani Yarn Is Surging

Customs data shows China imported approximately 172,200 tons of cotton yarn in May 2026. Pakistani yarn arrivals totaled 21,310 tons, nearly flat month-on-month but soaring 80.36% year-on-year. This growth far outstripped Vietnam (down 11.83% month-on-month) and India (down 29.38% month-on-month). Pakistan's share of total imports has risen to 12.37%, approaching India's 13.02%.

Pakistani mills are grappling with weak domestic demand and a persistently depreciating rupee. The rupee's medium-to-long-term decline against the dollar has lowered export prices, boosting overseas sales. Meanwhile, improved energy and power supply has raised mill operating rates, increasing output and export pressure. Bilateral trade facilitation policies between China and Pakistan are also reducing transaction costs.

Open-End Spinning's Struggles and Southeast Asian Order Retreat

In contrast to the active market for Pakistani siro yarn, open-end spinning yarn is cooling. Weaving mills and yarn traders in Guangdong, Jiangsu, Zhejiang, and Shandong report sluggish inquiries and transactions for bonded and forward cargo open-end yarn. FOB/CNF/CIF quotes from Vietnam, Indonesia, Malaysia, and India continue to edge down.

Two factors are at play: first, the wave of apparel orders transferred from Southeast Asia to China is winding down, which had heavily consumed low-to-mid count open-end yarn; second, domestic winter-spring orders have not yet materialized. The supply-demand gap for open-end yarn is narrowing, weakening price support.

July Tariff Risks and Procurement Window

Expectations of US tariff hikes on Chinese imports in July, based on Section 301 investigation results, are dampening speculative buying of imported yarn. Some traders are holding cash, waiting for lower entry points for Pakistani yarn. A Zhejiang-based textile import-export company notes that Pakistani cotton prices corrected sharply in mid-June, increasing mill export pressure, but buyers prefer to wait for even lower levels.

For buyers, the key is to assess whether Pakistani yarn's cost advantage is sustainable and where the price floor for open-end yarn lies.

For Buyers - Monitor Pakistani cotton price trends and rupee exchange rate movements; if cotton prices continue to correct, the procurement window for 8S-21S siro yarn may widen further - Defer large open-end yarn purchases until Southeast Asian mills cut prices to clear inventory, but allow 1-2 months for shipping - Review product categories subject to potential US tariff hikes in July to avoid landed cost surprises

For Exporters - Pakistani exporters should leverage China-Pakistan trade facilitation policies to accelerate two-way flows of yarn and fabric, locking in renminbi settlement advantages - Vietnamese and Indian mills need to shift product mix toward higher-count, higher-value varieties to avoid direct price competition with Pakistan in low-to-mid count segments - Monitor capacity redistribution as Southeast Asian orders fade; some open-end capacity may shift to local markets or emerging destinations like Africa and Bangladesh