India's domestic cotton prices remained relatively stable in the second half of 2025. Although the new cotton harvesting season (October–December) may bring short-term supply pressure, fluctuations in international oil prices and competition from chemical fiber substitutes will limit upward momentum. Currently, India's cotton stock-to-use ratio is at a neutral level. Unless extreme weather events or sudden changes in export policies occur, cotton prices are unlikely to form a strong unilateral trend, resulting in a mild cost transmission effect on yarn.
Domestic textile and apparel consumption in India is constrained by inflationary pressures. Downstream weaving mills are operating at rates between 65% and 70%, with procurement mostly consisting of small orders based on rigid demand, making it difficult to support a significant increase in yarn prices. Export orders have become a key variable, as import demand for Indian cotton yarn (especially medium and low-count yarn below 40s) from countries such as China and Bangladesh will directly influence price fluctuations. If competing production regions like Vietnam or Pakistan encounter supply issues, Indian yarn export prices may receive a short-term boost. Additionally, as December approaches the tail end of Western Christmas orders, the momentum for new external demand may weaken, shifting market focus toward spring 2026 restocking.
Fluctuations in energy costs (electricity prices) may affect the capacity utilization of yarn mills in northern India. Factory inventories are currently at moderate levels, and a decline in operating rates could trigger localized supply tightness. Whether the Indian government adjusts cotton export tariffs or yarn export rebate policies will become a potential source of price volatility. For mainstream yarn varieties (30s carded), prices are expected to remain within the range of $3.85–$4.05 per kilogram (FOB North India), with short-term fluctuations not exceeding 3%. High-count combed yarn (above 60s), supported by orders from international brands, exhibits stronger price resilience and may strengthen slightly to $5.2–$5.4 per kilogram. In early December, as procurement activity slows, prices may experience a slight correction.
Buyers may adopt a strategy of "batch procurement and securing long-term agreements with quality suppliers" to avoid chasing prices during concentrated demand. Producers should monitor the trend of substitution by chemical fibers and appropriately adjust their product mix to mitigate the impact of cotton yarn price fluctuations. Overall, the North Indian cotton yarn market will enter a "low-volatility game phase" by the end of 2025. Close attention is advised to procurement dynamics in China and adjustments in India's domestic energy policies.
