Shandong Cotton Yarn Market Shows Price Divergence: Spread Between 21S and 32S Widens, High-Count Yarn Under Pressure

A noteworthy signal is emerging in the Shandong cotton yarn market: the price spread between 21S and 32S ring-spun knitting yarn is widening. On July 10, multiple Shandong mills quoted high-grade 32S knitting yarn at 24,500-26,400 RMB/ton, while 21S ranged from 22,800-24,400 RMB/ton. The spread has expanded from the typical 1,000-1,500 RMB/ton to nearly 2,000 RMB/ton, reflecting uneven demand downstream.

Price Divergence: The Pricing Logic for Different Yarn Counts Is Changing

Looking at specific data: Shandong Guanxing Textile quoted 21S at 22,800 RMB/ton and 32S at 24,500 RMB/ton, a spread of 1,700 RMB/ton; Weifang Guanjie Textile quoted 21S at 24,400 RMB/ton and 32S at 25,400 RMB/ton, a spread of 1,000 RMB/ton; while Shandong Hongyang Chemical's domestic 32S reached 26,400 RMB/ton, creating an even wider gap. Notably, the 32S quotation range spans 1,900 RMB/ton (24,500-26,400), compared to just 1,600 RMB/ton for 21S (22,800-24,400), indicating greater pricing divergence in the 32S market.

What does this divergence mean? 32S, as a mainstream knitting yarn, is directly tied to apparel orders. The widening spread may reflect rising raw material costs (e.g., high-quality cotton) for higher-count yarns, but also suggests that downstream buyers are demanding stricter quality standards for 32S, allowing premiums for high-grade products. In contrast, the narrower 21S spread indicates more homogenized competition in the lower-count segment, giving buyers greater bargaining power.

Shandong Industrial Cluster Reaction: Mills Adopt Different Pricing Strategies

As one of China's key cotton yarn production bases, quotes from mills in Weifang and Guanxian are market bellwethers. In this round, Weifang Jinyi Yarn and Runfengda Textile both quoted 21S at 23,200 RMB/ton and 32S at 24,800 RMB/ton, a spread of 1,600 RMB/ton—close to the industry average. But Shandong Hongyang Chemical's 32S at 26,400 RMB/ton exceeded other regional mills by 1,000-1,900 RMB/ton, possibly due to different raw material batches, quality certifications, or customer profiles.

For buyers, this means the price gap for the same yarn count across suppliers has exceeded 10%. With cotton prices relatively stable (Q2 2026 average around 15,500 RMB/ton), mill profit margins are already thin. This pricing divergence may indicate some mills are raising prices to pass on costs, while others maintain low prices to defend market share. Such strategic divergence will accelerate the survival-of-the-fittest process within the cluster.

Downstream Transmission: How Knitting Mills and Fabric Traders Should Respond

Cotton yarn price fluctuations directly impact the knitted fabric segment. If 32S knitting yarn's main transaction price stays above 25,000 RMB/ton, raw material costs for jersey and T-shirt fabrics will rise about 5%-8% year-on-year. Garment factories with forward orders that haven't locked in yarn prices risk margin erosion.

Conversely, 21S quotes remain relatively stable (22,800-24,400 RMB/ton), benefiting producers of sweatshirts, casual pants, and other heavier fabrics. As the spread widens, some buyers may adjust product mix to increase 21S usage for cost control, potentially dampening 32S demand further and creating a counterbalancing effect.

Practical Recommendations

For Procurement Teams - Focus on the quotation range for high-grade 32S yarn; if the spread exceeds 1,500 RMB/ton, prioritize suppliers quoting 24,500-25,000 RMB/ton to avoid overpaying for brand premiums. - For 21S, adopt a multi-supplier comparison strategy; the reasonable range is 22,800-23,200 RMB/ton. Consider alternative suppliers if quotes exceed 24,000 RMB/ton. - For long-term orders, sign a 3-month price lock agreement with mills before end-July to hedge against potential price hikes during the traditional peak season in August-September.

For Foreign Trade Companies - Build a 5% price elasticity buffer into 32S knitting yarn export quotes, as overseas buyers are more price-sensitive for higher-count yarns. A widening spread could shift orders to lower-cost regions like Pakistan or Vietnam. - Increase promotion of 21S products, especially for Middle Eastern and African markets, where price competitiveness is stronger than Indian yarn (currently ~24,000 RMB/ton for Indian 21S). - Monitor Shandong mill operating rates closely: if the pricing divergence persists beyond one month, it may signal cash flow pressure for some smaller mills, presenting opportunities to negotiate lower prices for inventory yarn.