In July 2026, China imported approximately 160,000 tons of cotton yarn, a month-on-month decrease of 10,000 tons but a year-on-year surge of 53.9%. This striking contrast signals that despite monthly fluctuations, imported cotton yarn is penetrating the domestic market at an accelerating pace. Cumulative imports for the first seven months reached 1.21 million tons, up 56% year-on-year, approaching 70% of last year's total. Imported yarn is no longer a supplementary source but is becoming one of the mainstream choices for downstream weaving.
The Industrial Logic Behind the Import Surge
The sustained surge in imported cotton yarn is not driven by a single factor. From the cost perspective, overseas major cotton-producing regions maintained significant price advantages in the 2025/26 season, with landed prices of yarn from India, Vietnam, and other countries consistently lower than domestic products of the same count, with the price gap widening to over 1,000 yuan per ton at times. For weaving enterprises, raw material costs account for more than 70% of total costs, and a 1,000-yuan gap is enough to determine order allocation.
More noteworthy is the structural change. Cumulative imports for the 2025/26 season (September 2025 to July 2026) reached approximately 1.8 million tons, up 40.6% year-on-year, with the growth rate accelerating compared to the previous season. This indicates that import growth is not a short-term inventory replenishment but a long-term trend of industrial chain division. Domestic ring-spinning capacity is under dual pressure from high costs and low profits, with some small and medium-sized spinning mills operating at less than 60% capacity, while downstream weaving clusters are increasingly accepting imported yarn.
Transmission Effects on Domestic Spinning and Weaving
The surge in imported yarn directly impacts the profit margins of domestic spinning. Domestic 32-count pure cotton yarn prices continued to decline in the first half of 2026, while imported yarn prices remained relatively firm, further undermining the cost-performance of domestic yarn. For spinning enterprises focusing on conventional counts without differentiated products, the risks of order loss and inventory accumulation are intensifying.
However, for the weaving sector, the stable supply of imported yarn brings diversification of raw material options. Procurement managers in Guangdong, Jiangsu, and Zhejiang weaving clusters reported that imported yarn offers stable consistency and bleachability, particularly suitable for large-scale, standardized grey fabric production. This means weaving enterprises can switch sources more flexibly and gain stronger bargaining power amid price fluctuations.
Another hidden impact is the change in supply chain resilience. Over-reliance on imported yarn also exposes domestic weaving to risks from overseas logistics, exchange rates, and trade policy fluctuations. During the second quarter of 2026, when ocean freight rates rose temporarily, some factories relying heavily on imported yarn experienced significant delivery delays. This lesson has prompted some enterprises to reassess the ratio of domestic versus imported sources.
Practical Recommendations
For Procurement Teams - Establish a dynamic price comparison model between imported and domestic yarn, tracking the price gap for major counts weekly. When the gap narrows to within 500 yuan per ton, prioritize domestic sources to reduce supply chain risks. - Sign long-term agreements with 2-3 overseas suppliers, locking in at least 60% of annual procurement volume, with the remainder sourced on a spot basis to balance price volatility and delivery flexibility. - Monitor exchange rate trends and increase forward hedging operations during RMB appreciation windows to reduce import cost uncertainty.
For Foreign Trade Enterprises - Adjust product mix toward high-count, blended, and functional yarns, avoiding the conventional count range where imported yarn dominates, and build competitive barriers through differentiation. - Expand overseas contract manufacturing cooperation, leveraging the cost advantage of imported yarn to establish weaving capacity in Southeast Asia, forming a synergy of "overseas spinning + domestic weaving." - Strengthen inbound quality inspection of imported yarn and establish a blacklist system for suppliers to prevent batch issues from affecting export order fulfillment.
The sustained high growth of imported yarn data is essentially a microcosm of the global textile chain cost restructuring. For domestic enterprises, rather than passively enduring the impact, it is wiser to proactively adjust positioning and find their own value fulcrum in the new division of labor within the industrial chain.