Cotton yarn industry growth rate estimated to be 9 percent

05-May-2025 04:30 PM

New Delhi. In view of positive export market trends and favorable domestic demand, the revenue of the Indian cotton yarn industry is expected to grow by 7 to 9 percent during the financial year 2025–26, compared to 2 to 4 percent in 2024–25.

According to a leading rating agency, the volume of cotton yarn exports is projected to increase significantly this year, boosting export earnings.

Additionally, a slight improvement in cotton yarn prices is also anticipated. Last year, the industry saw some recovery in its operating margins, and this trend is expected to strengthen further during the current financial year.

The stability in the cotton yarn spread and a healthy stock of cotton maintained by the Cotton Corporation of India (CCI) are expected to ensure steady raw material supply for producers.

These projections are based on an analysis of data collected from 70 cotton yarn spinners, who together contribute 35 to 40 percent of the total revenue of the Indian cotton yarn industry.

A significant increase in Indian cotton yarn exports to China is expected this year. Export earnings account for around 30 percent of the industry’s revenue, with China alone representing about 14 percent.

However, in the financial year 2024–25, Indian exports of cotton yarn to China had declined due to an unexpected surge in cotton production in that country.

This led to an overall drop in India’s cotton yarn exports by 5 to 7 percent. Despite this, the current outlook remains optimistic due to improving international demand and stable domestic conditions.