India second largest cotton yarn supplier to China

India was the second largest cotton yarn supplier to China in 2017 with a share of 19% in it’s total imports. The top suppliers, obviously, remains Vietnam with a share almost twice of India. However, there was a sharp recovery seen in imports from India in last few months of the year with India topping against all others.

However, imports from India declined 6% in volume in 2017 but was up 2.4% in value terms, implying almost 9% increase in unit price. Volume imports from India was at 390 million kgs valued at US$1,071 million, at an average price of US$2.74 a kg. China’s import from its top supplier Vietnam was 716 million kgs worth US$2,028 million at an average price of US$2.83 a kg, about US cents 9 higher than India. Two factors that prompts importing high priced yarn from Vietnams could be, one quality and two high returns on investments. Chinese companies have invested heavily in Vietnam’s textile sector and the production is bought back even at higher price which also brings in high returns in form of higher profits to producers.

China’s overall cotton import has consistently fallen over the years as it moved towards more self sufficiency in domestic market. With huge cotton reserves, raw material availability prompted domestic mills to expand and install new capacities. In 2014, it had imported 2,243 million kgs (US$6,775 million) of cotton yarn, which has shrunk to 1,983 million kgs (US$5,460 million) in 2017.

Pakistan was the third largest cotton yarn supplier to China, with a share of around 15% of China’s total imports. The average price was low at US$2.41 a kg since most yarns are of coarser counts. Total volume was 341 million kgs valued at US$821 million. Nevertheless, it was the highest supplier in 2014 with volumes at 506 million kgs worth US$1,388 million.