South India’s yarn prices dip in Mumbai amid textile market slump

South Indian cotton yarn prices in Mumbai have fallen sharply this week, dropping an estimated Rs 5 to 8 per kg due to heavy selling pressure from spinning mills. The price slump is a direct result of weak demand from the downstream garment and weaving sectors, which are grappling with a significant inventory backlog. With readymade garment units slowing down production, fabric lifting has become sluggish, causing yarn stockists to offload inventories quickly and accept lower realizations.

This domestic drop is heightened by a challenging global export environment; India's apparel exports have seen recent declines, compounding the pressure on the entire textile value chain. Spinning mills are struggling to maintain margins, particularly smaller units facing tight cash flow due to the slow pace of recovery and delayed payments from buyers. Industry analysts note that while the market is currently bearish, the long-term outlook remains cautiously optimistic, provided global economic recovery and domestic festive demand materialize to absorb the current excess supply. The current pressure highlights the high vulnerability of the domestic cotton yarn segment to fluctuations in global textile trade.