Cotton yarn prices jump 60%, clothes industry seeks export curbs

New Delhi, August 29: Apparel exporters have urged Union Commerce and Industry Minister Piyush Goyal to consider measures to regulate cotton yarn exports, particularly 20s count and above, citing a sharp rise in yarn prices and its impact on the competitiveness of India’s apparel industry.

Apparel Export Promotion Council (AEPC) Chairman A Sakthivel, in a communication to Goyal, said rising prices of raw cotton and cotton yarn, driven by supply-side constraints, were putting increasing pressure on the apparel manufacturing value chain.

According to the AEPC, limited stock availability with ginners and reduced arrivals have forced textile mills to increasingly depend on auctions conducted by the Cotton Corporation of India (CCI).

Sakthivel also said a substantial quantity of cotton had moved from farmers to traders, contributing to hoarding and speculative practices in the market.

“AEPC has urged the minister to consider suitable measures to regulate the export of cotton yarn, particularly 20s count and above, in view of the sharp increase in yarn prices and the growing pressure on the competitiveness of India’s apparel export industry,” he said.

Cotton yarn prices have risen by around 60 per cent, from approximately Rs 250 per kg in early 2026 to around Rs 400 per kg currently, according to the council. The increase, coupled with higher costs of other raw materials and fuel, is further aggravating cost pressures for apparel manufacturers.

The AEPC also pointed to a rise in exports of Indian cotton and cotton yarn to apparel-producing countries such as Bangladesh and Vietnam following US restrictions on the use of Chinese cotton under the Uyghur Forced Labor Prevention Act (UFLPA).

“This has added to the pressure on raw material prices across the garment value chain,” Sakthivel said.

He said rising apparel manufacturing costs were affecting the competitiveness of Indian exporters at a time when opportunities were expanding in international markets, particularly in emerging free trade agreement (FTA) markets such as the UK and New Zealand.

The AEPC further argued that exporting finished garments generates substantially higher value realisation and employment compared with exports of raw cotton and yarn.

It noted that raw cotton fetches around Rs 275 per kg, while cotton converted into yarn fetches approximately Rs 325 per kg. In contrast, a kilogram of finished garments can fetch between Rs 800 and Rs 1,200 after value addition.

The exporters therefore stressed the need for policy measures that ensure adequate availability of cotton yarn for domestic apparel manufacturers while supporting the growth and competitiveness of India’s garment exports. PTI