India’s cotton yarn prices jump 60% to about Rs 400 per kg, squeezing textile margins as FTA benefits lag
AI Market Summary
Indian cotton yarn prices have surged ~60% since early 2026 amid weaker cotton output and an estimated supply gap, tightening raw-material availability for spinners and downstream apparel makers. Exporters report up to ~15% higher production costs and limited ability to pass through increases, implying margin compression and potential order competitiveness risks despite improved market access from FTAs. The news highlights near-term supply-side stress across the cotton-to-apparel chain.
Impact level
● Medium
Affected assets
NCCOCOTTON2USD/USDT-0.18%
AI Insight · NCCOCOTTON2USD/USDTAI Insight
▼ Bearish
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India’s cotton yarn prices have risen 60% since early 2026 to about Rs 400 per kg, lifting costs across the textile chain. Provisional government data show cotton output at 290.91 lakh bales in the 202526 season, down from 352.48 lakh bales in 202021, contributing to an estimated shortage of around 10 lakh bales. Tiruppur exporters say the surge has pushed production costs up by as much as 15%, tightening margins. The industry is also grappling with concerns that recent free trade agreements may not translate into gains if input costs remain elevated.
