Mumbai, 29 Sep (Commoditiescontrol): India's cotton yarn imports have surged nearly three-fold this marketing year (MY21-22) so far, as higher costs of locally sourced yarn amid exhausting cotton stocks have encouraged textile millers/weavers to look for cheaper source elsewhere.
As per the data tabulated and analysed by Commoditiescontrol, cotton yarn imports have gathered steam from April onwards, when the textile mills sourced 214.98 thousand kg of cotton yarn, slightly lower to year ago level of 247.07 thousand kg.
Millers/weavers resorted to imports since they faced danger of rendering their capacity idle. The imported cotton yarn was available at Rs 30/kg cheaper to domestically produced yarns, a local source informed.
Trade set-up turned favourable for millers/weavers as cotton yarn prices in overseas markets nosedived. This downfall was trigerred by US decision to impose a ban on imports of cotton and cotton products produced in Xinjiang due to alleged human rights violations and forced labour in the region.
The ban came into effect from June 2022 this year. Cotton and cotton yarn prices have witnessed a sharp fall in China following the ban. This worked in favour of Indian cotton yarn importers.
It may be noted that India has the world’s second largest spinning capacity, after China. India produces 4.7 mt of spun yarn of which 3.4 mt is cotton yarn.
Meanwhile, industry experts said that Chinese cotton yarn, even if it was produced from cotton from the Xinjiang region, can be consumed for products manufactured for domestic and non-US international markets.
Vietnam has emerged top source for cotton yarn imports in India. So far, 10758 thousand kg of cotton yarn is being important from the ASEAN country.
Although, direct imports from China remains miniscule, but some industry sources believe that the cotton yarn being imported by consumer industry is produced from Chinese cotton. Oman is another big source of cotton yarn supplies for Indian textile millers.
Mundra port received higher number of cotton yarn cargo during the period under review followed by JNPT and Madras port. Vizag, Tuticorin, Cochin, Ahmedabad ports too remain fairly busy so far handling cotton yarn cargo.
The country is witnessing cotton yarn imports for the first time. This was forced by fears of huge weaving capacity rendered idle. Industry observers say the spinning industry in India is currently operating at half of its installed capacity due to lower demand. They expect imports to continue for sometime.
(By Commoditiescontrol Bureau; +91-22-40015513)
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