South Indian cotton yarn falls in Mumbai amid selling pressure

Introduction
South India’s cotton yarn market has seen fresh weakness recently, with prices slipping in Mumbai and Tiruppur as mills and stockists moved to clear inventory amid poor end-user demand and growing yarn imports from China. Small Tamil Nadu spinners faced particular stress, prompting short-notice price cuts in carded yarn, while combed varieties — largely supplied by larger North India mills — held a more mixed trend.

Market snapshot (key prices reported)

• Mumbai

  • 60s carded (warp/weft): ₹1,700–1,750 / 5 kg (GST extra)

  • 60s combed (warp): ₹360–365 / kg

  • 80s carded (weft): ₹1,540–1,580 / 4.5 kg

  • 44/46s carded (warp): ₹313–318 / kg

  • 40/41s carded (warp): ₹300–305 / kg

  • 40/41s combed (warp): ₹318–325 / kg

• Tiruppur

  • 30s combed: ₹300–305 / kg (GST extra)

  • 34s combed: ₹315–320 / kg

  • 40s combed: ₹320–325 / kg

  • 30s carded: ₹270–275 / kg

  • 34s carded: ₹275–280 / kg

  • 40s carded: ₹285–290 / kg

• Gujarat (cotton)

  • Seed/ginned cotton trading at around ₹68,600–69,000 per candy (356 kg); arrivals estimated 28,000–35,000 bales.

Note: market participants reported carded yarn losing ₹5–7/kg in some Tamil Nadu mills.

What’s driving the fall?

1. Weak end-user demand — downstream consumers are buying cautiously amid slower retail/offtake.

2. Mills clearing stocks — mills and stockists in Mumbai are under pressure to liquidate inventories, pushing prices down.

3. Chinese yarn imports — additional imported supply is weakening domestic sentiment and adding competition.

4. Fragmented supplier base — small spinners in Tamil Nadu react quickly to demand changes, creating volatile short-notice price moves.

5. Farmers’ behaviour — limited cotton arrivals in Gujarat and farmers’ reluctance to sell may keep raw material availability uneven, affecting regional pricing dynamics.

Quick analysis — who’s impacted and how

• Small spinners (TN): Margin squeeze from forced discounting on carded yarn; cashflow pressure likely.

• Large mills (North India): Combed yarn remains more stable but faces demand headwinds if retail stays sluggish.

• Traders / stockists (Mumbai): Inventory risk rising as holding costs and GST timing compress margins.

• Textile manufacturers / converters: Short-term buying opportunities on lower yarn prices, but must balance against uncertain demand.

• Farmers (Gujarat): Despite lower downstream yarn prices, seed and ginned cotton prices rose as farmers held back supply — creating a supply mismatch.

Conclusion

The recent decline in South Indian cotton yarn prices — evident in Mumbai and Tiruppur — reflects a classic demand-supply and sentiment shock: weak end-user buying, competitive imports and mills clearing stock. While carded yarn from small spinners is most affected (losing ₹5–7/kg in places), combed yarn supplied by larger mills shows relative stability. Market participants should balance short-term buying opportunities against persistent demand uncertainty and monitor cotton arrivals and import flows closely. For actionable next steps: mills should shore up working capital and offer targeted sales, traders should minimize inventory risk, and manufacturers should buy smartly in tranches.