Cotton yarn prices jump 60%; exporters seek export curbs
Cotton yarn prices have surged 60% to Rs 400 per kg, pushing AEPC to urge curbs on exports of 20s count and above as raw material costs erode garment makers' competitiveness.
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Apparel exporters have asked Commerce Minister Piyush Goyal to consider regulating cotton yarn exports, citing a roughly 60% price surge that is squeezing margins across the garment value chain.
Apparel Export Promotion Council (AEPC) Chairman A Sakthivel, in a letter to the minister, said rising raw cotton and yarn prices stem from supply-side constraints. Limited stock with ginners and reduced arrivals have pushed mills to rely increasingly on Cotton Corporation of India (CCI) auctions, he said. A substantial quantity of cotton has moved from farmers to traders, contributing to hoarding and speculative practices.
Cotton yarn prices have risen from about Rs 250 per kg in early 2026 to around Rs 400 per kg currently, Sakthivel said. The AEPC urged the government to consider measures to regulate exports of yarn, particularly 20s count and above.
The letter also flagged rising costs of other raw materials and fuel. Sakthivel pointed to increased exports of Indian cotton and yarn to Bangladesh and Vietnam after US restrictions on 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," he said.
Higher apparel manufacturing costs are hitting Indian exporters at a time when opportunities are expanding in new free-trade agreement markets such as the UK and New Zealand, the letter said.
Sakthivel contrasted the value of raw exports with finished garments. Raw cotton fetches about Rs 275 per kg, while cotton yarn brings roughly Rs 325 per kg. A kilogram of finished garments, after value addition, can fetch between Rs 800 and Rs 1,200.
The difference in employment potential is equally stark, he argued, without providing specific job figures. The AEPC's request is a direct appeal to keep more of the cotton value chain inside India's borders.
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