China's cotton import market is undergoing a quiet structural reshuffle. In June 2026, total imports remained high at 110,000 tons, up 3 times year-on-year, but performance among source countries diverged sharply. Brazilian cotton's dominance is being challenged, while Australian cotton is rapidly filling the gap.
Import Volume Surges but Shows Monthly Slowdown
Customs data shows June imports fell 2.7% month-on-month, directly linked to the traditional off-season for Chinese textile mills. However, year-on-year growth remains striking due to last year's extremely low base of only 27,000 tons caused by tariff hikes. First-half cumulative imports reached 935,000 tons, up 100% year-on-year. The 3,000 yuan/ton domestic-international price gap and continued use of sliding-duty quotas are the main drivers.
Brazilian Cotton Loses Momentum: Price Advantage Fades
June Brazilian cotton imports fell 32.2% month-on-month to 44,100 tons, with its share dropping from 58% to 40%. The core reason is price: Brazilian cotton average price rose 3.3% to $1,669/ton, while Australian cotton fell 1.1% to $1,927/ton. Although Australian cotton remains about 15% more expensive, its quality advantages in length and strength now outweigh the cost difference.
Australian Cotton's Surge: From Fringe to Mainstream
Australian cotton imports soared 22 times month-on-month to 30,600 tons, capturing 28% of the market. This leap reflects stable prices, improved supply from Australia's 2025/26 harvest, and its irreplaceable role in high-end yarns. US cotton imports stood at 17,900 tons with 16% share, down 6 percentage points, as its 9.2% price increase drove buyers away.
Trade Mode Shifts Signal Behavioral Changes
General trade imports rose 1.4% month-on-month to 21,000 tons, with share up 12 percentage points to 19%. This indicates more companies are directly importing rather than using bonded zones, reflecting more rigid demand. Meanwhile, special customs supervision zone logistics remained the largest channel at 43,000 tons, but bonded warehouse trade fell 12 percentage points to 33%.
Global Supply-Demand Outlook Shifts
USDA's July report shows 2026/27 global cotton production up 2.613 million tons, led by Brazil, US, and Turkey. But beginning stocks are down, ending stocks only slightly up, and stocks-to-use ratio rises to 58.4%. Brazil's ABRAPA reports 2025/26 exports of 3.219 million tons, up 18.9%, with China still the top buyer at 767,000 tons (24% share). However, China's June purchase decline signals price sensitivity.