The steep growth curve of cotton yarn imports is reshaping the supply-demand landscape of China's textile raw materials. According to public customs data, imports in June 2026 reached approximately 170,000 tons, a year-on-year increase of 54.2%. The first-half total hit 1.05 million tons, up 56.3%, and the cumulative imports for the 2025/26 season (September to June) reached 1.64 million tons, a 40.2% increase. These figures point to a clear industrial signal: imported cotton yarn is penetrating the Chinese market at a pace unseen in recent years.
For domestic spinners, this data represents a direct loss of market share. The competitive advantage of imported yarn lies in price and delivery stability. Overseas cotton prices are lower than domestic ones, and some Southeast Asian countries benefit from tariff preferences on exports to China, making the landed cost of imported yarn generally lower than that of comparable domestic products. Downstream weaving enterprises, driven by cost considerations, are accelerating their switch to imported sources for conventional varieties where special quality is not required.
Underlying Logic of the Import Surge
This round of import growth is not a short-term spike. The cumulative data for the 2025/26 season shows an increase of over 40%, indicating a sustained structural shift. Three forces are driving this trend:
- The persistent inversion of domestic and international cotton prices, with high domestic raw material costs remaining unchanged
- The continued expansion of spinning capacity in Southeast Asia, particularly in Vietnam, India, and Pakistan
- The signing of long-term contracts by some domestic weaving enterprises with overseas suppliers to lock in costs, making imports more rigid
Additionally, fluctuations in the RMB exchange rate between 2025 and 2026 have periodically reduced import settlement costs, further stimulating import orders.
Transmission Effects on the Supply Chain
The influx of imported yarn first impacts small and medium-sized domestic spinning mills. These factories have highly homogeneous products and weak bargaining power, facing pressure on both operating rates and profit margins under the price offensive of imported yarn. Some have shifted to differentiated products, such as organic cotton, recycled cotton, and high-count combed yarn, to avoid direct competition.
For weaving and garment processing enterprises, the ample supply of imported yarn objectively enriches raw material options and benefits cost control in the short term. However, over-reliance on imports introduces supply chain risks: overseas suppliers' delivery times are heavily influenced by logistics and geopolitical factors. In the event of a shipping disruption or trade friction, downstream companies could face supply shortages.
Traders are showing clear divergence. Large importers, with their capital and channel advantages, are profiting handsomely from imported yarn businesses, while small and medium-sized traders, lacking stable overseas sources and client bases, are gradually exiting this track.
Industry Response and Future Outlook
In the short term, the strong position of imported yarn is unlikely to reverse. Domestic spinning enterprises must face this reality and seek solutions through cost control and product differentiation. In the long run, the sustained growth of cotton yarn imports may force the optimization of domestic cotton target price subsidy policies to narrow the price gap.