The South Indian cotton yarn market is currently facing a slowdown due to weak monsoon demand and restricted liquidity in the textile sector. Key production hubs like Tiruppur and Mumbai are witnessing reduced buying interest from weavers and garment manufacturers, forcing traders to offer discounts. Despite this, overall price levels have remained largely stable, supported by limited trading activity.
Industry sources report that spinning mills have adopted a cautious approach, scaling back procurement in line with falling order volumes. Meanwhile, downstream demand remains subdued both in domestic and export markets, especially from major destinations such as the United States and the European Union. Labour shortages—exacerbated by seasonal factory closures and religious observances—have added further strain on production and sales.
Cotton prices have softened slightly, but this has not translated into stronger yarn buying due to continued market uncertainty. Mills remain hesitant to adjust yarn prices upward without a corresponding rise in demand.
Looking ahead, market participants are cautiously optimistic about a possible rebound around mid-August, when festive demand and seasonal garment orders typically resume. However, many believe a clearer recovery will only emerge if fresh export and domestic orders materialize.
In the meantime, liquidity concerns are prompting mills to seek improved credit terms and explore cost-saving alternatives, including blending cotton with viscose or synthetic fibers. The market remains watchful, with hopes pinned on a stronger second half of the year.
