China's cotton yarn imports decline for three consecutive months in Q2

I. China's cotton yarn imports totaled 96.6kt in Jun

According to the latest customs data, China's cotton yarn imports in Jun 2024 dropped to around 96.6kt, a decrease of about 7,300 tons compared to May, and a decrease of 28.8kt compared to June of last year. Since the second quarter of this year, the import volume of cotton yarn in China has shown a trend of three consecutive decreases. From Jan-Jun 2024, China's total import of cotton yarn reached 701.4kt, still higher by 83.5kt compared to the cumulative import volume of the same period last year.

II China's cotton yarn imports by origin in June 2024

China's cotton yarn imports are sensitive to price. In recent months, as U.S. cotton prices continue to decline, Vietnamese yarn has been steadily expanding its market share, aided by the zero tariff policy. Vietnamese cotton yarn arrived in June totaled approximately 50kt, a decrease of 3.8kt from May, maintaining a market share of around 52%. Among them, the volume back flowing to Chinese market by Chinese-funded mills accounts for a significant proportion. The import volume of Pakistani yarn rose slightly to 12.8kt in June, making up about 13% of the total. Imports of Uzbekistani cotton yarn, however, have experienced more significant fluctuations due to the shipping cycle, with China's cotton yarn imports in June falling to around 9.1kt, capturing 9% of the market and ranking third. Additionally, Indian yarn has seen a relative decline in export competitiveness after the local government raised the Minimum Support Price (MSP) for cotton. In June, Indian cotton yarn arrived was only about 5.8kt

III China's cotton yarn imports by structure in Jun 2024

Since the beginning of 2024, the proportion of coarse-count yarn in China's cotton yarn imports has been steadily increasing. Due to the low-price competition from domestic cotton yarn, the import volumes of carded ring-spun cotton yarn 32s and 40s have significantly declined compared to last year. In June, the import proportion of carded single yarn below 8s was nearly 1/5, totaling approximately 18.7kt; the import proportion for carded single yarn 8-25s was 50.63%, totaling 48.9kt; the import proportion of carded single yarn 30-47s dropped to below 10%, totaling only 9,022 tons. The import proportion of combed single cotton yarn 8-47s slightly increased to 14.51%, totaling approximately 14kt.

In June, most of the imported open-end yarn and siro-spun yarn below 8s are mainly originate from Vietnam and Pakistan, while imported carded single yarn 8-25s is mainly originate from Vietnam, Bangladesh, and Pakistan. Among carded single yarn 30-47s, Uzbekistani yarn accounts for 56.3%, with approximately 5,133 tons arrival; while among combed yarn 30-47s, over 4,300 tons are imported from Vietnam, while only approximately 749 tons are originated from India.

IV. China's blended cotton yarn imports in June 2024

In contrast to the ongoing decline in the import volume of cotton yarn, the import of blend cotton yarn has shown relative stability. In June 2024, China's imports of blended cotton yarn totaled around 12.3kt, showing a slight decrease of approximately 1.3kt compared to May, the overall volume remains above the average import level of the previous year. Imported blended yarn is primarily used for producing apparel orders with traceability requirement in China and competes in a slightly different market segment than domestic cotton yarn, particularly with a slight shortage in the supply of combed CVC yarns. However, the overall import profit levels remain thin. The inflow of cotton blend yarn imports in June was concentrated in the Yangtze River Delta and the Pearl River Delta regions, with Zhejiang Province accounting for 36.65%, Guangdong Province for 28.13%, and Fujian Province for 12.34% of the total imports.