Cotton Yarn Prices Soar 60%: Indian Textile Industry Faces Growing Cost Crisis
India’s textile industry is facing growing cost pressure as cotton yarn prices have surged sharply, limiting the expected benefits from the country’s expanding free trade agreements (FTAs).
According to the Apparel Export Promotion Council (AEPC), cotton yarn prices have risen nearly 60% to around ₹400 per kg from ₹250 per kg in early 2026. Apparel exporters have urged the government to consider measures to regulate yarn exports and contain domestic prices.
Industry representatives say rising yarn prices and limited cotton availability are creating a serious challenge for the textile sector. Tiruppur Exporters’ Association Secretary General Kumar Duraiswamy said India is facing a shortage of around 10 lakh bales and called for extending duty-free cotton imports and increasing domestic production.
Government data shows cotton production fell to 290.91 lakh bales in 2025-26, compared with 352.48 lakh bales in 2020-21. Industry players say lower production and international market conditions are contributing to higher yarn prices.
Rising yarn costs are squeezing margins across the textile value chain. Primus Partners’ Kanishk Maheshwari said Tiruppur exporters estimate production costs have increased by up to 15%. High input costs are also raising fabric and garment costs, while exporters face difficulties passing the entire increase to global buyers.
Industry experts believe FTAs can provide valuable market access, but high input costs could reduce India’s competitiveness. They called for predictable raw-material supplies, greater flexibility on cotton imports, improved productivity, technology adoption and supply-chain efficiency.
Experts stressed that India must strengthen the entire textile value chain—from cotton and yarn to finished garments—to convert FTA opportunities into sustained export growth.
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