On July 10, 2026, multiple Shandong-based cotton yarn mills released quotes for 21S and 32S high-spec ring-spun knitting yarns, revealing a pronounced price divergence. The spread between the highest and lowest quotes for the same specification reached 1,600 RMB/ton, while some suppliers' prices for the two counts nearly converged. This is not mere market noise but a signal of shifting profit distribution and demand structure along the textile chain.
Cost Logic Behind the Divergence
The data shows 21S yarn quotes ranging from 22,800 to 24,400 RMB/ton, and 32S from 24,500 to 26,400 RMB/ton. Guanxing Textile quoted 21S at 22,800 and 32S at 24,500, a spread of 1,700 RMB. Weifang Guanjie quoted 21S at 24,400 and 32S at 25,400, narrowing the gap to 1,000 RMB. In contrast, Shandong Hongyang Chemical offered 32S at 26,400 without a 21S quote, hinting at a premium-market focus.
This divergence stems directly from uneven raw cotton cost pass-through. The fluctuating spread between Xinjiang cotton and imported cotton has widened cost gaps among mills. Mills using lower-cost reserve cotton hold a pricing edge on 21S, while those relying on imports maintain higher 32S prices. Public data shows that as of early July, the spot price of Grade 3128B cotton edged down 0.8% month-on-month, but the premium for high-grade cotton remained intact, explaining the wider 32S range.
Mill-Level Responses: Inventory vs. Order Book
The quotes also reflect divergent strategies within the Shandong textile cluster. Guanxing and Weifang Jinyi adopted conservative pricing, with a 21S-32S spread under 1,600 RMB, suggesting higher inventory pressure and a volume-over-price approach. Weifang Guanjie and Runfengda held firmer lines—Guanjie's 21S at 24,400 was 1,600 RMB above peers, either signaling recognized quality premiums or passive price support due to weak orders.
For downstream knitwear makers, this means rising procurement cost uncertainty. The elevated 32S quotes suggest that mid-to-high-end fabric demand has not yet collapsed, but the low-price competition on 21S signals overcapacity in low-count yarns. If this trend continues, the substitution effect of ring-spun yarn for open-end yarn may accelerate, as open-end holds a cost advantage below 21S.
Practical Implications for Buyers and Exporters
The current quote environment demands a revised supplier evaluation strategy. Simple price comparison may mislead—low-cost 21S could come from reserve cotton stocks with questionable consistency, while high-priced 32S may include brand premiums or special processing. Exporters, in particular, must note that overseas buyers increasingly demand strict yarn count and strength specifications; price differences can directly affect garment pass rates.
For Buyers - Build a multi-supplier cost matrix: calculate fabric yield per ton of yarn, not just unit price. - Prioritize transparent suppliers: Guanxing, which lists both 21S and 32S, offers easier production stability assessment. - Beware of extreme spreads: if a mill's 21S is 8% or more below market, request sample testing for evenness.
For Exporters - Include raw material fluctuation clauses in contracts: if cotton prices swing over 5%, reopen pricing to avoid margin lock-in. - Diversify sources for 32S and above: Shandong's divergence may push orders to Jiangsu and Henan; line up backup suppliers now. - Leverage the current 21S low-price window: if you have low-count yarn orders, consider increasing purchase volumes, but keep inventory turnover under 45 days.
Price divergence is the market's self-correction mechanism. For cotton yarn traders, transaction data over the next two weeks will matter more than the quotes themselves. TexCircle will continue tracking price linkages across the three major yarn-producing regions—Shandong, Jiangsu, and Henan—to provide sharper decision-making insights.