US tariff concerns slowdown cotton trade in North India

The ongoing ambiguity surrounding US tariffs on Indian textile imports has created a cautious environment for traders and manufacturers. Businesses are hesitant to commit to large-scale purchases or sales until the full implications of these tariffs become apparent. This "wait and watch" strategy, while prudent for individual businesses, is collectively contributing to the slowdown in trade volume across North India's vital cotton yarn sector.

Cotton yarn trade across North India has experienced a notable slowdown as buyers adopt a wait-and-see approach, awaiting clearer directives regarding potential US tariffs. This uncertainty is creating ripples throughout the region's textile market.

In Delhi, cotton yarn prices have seen an increase of Rs X per kg, a direct consequence of rising raw cotton costs. Conversely, the Ludhiana market has remained largely stagnant, characterized by persistently low demand. The recycled yarn trade in Panipat, a key hub for home textiles, is also facing weakness due to the pervasive tariff uncertainty impacting overall market sentiment.

The escalating price of cotton is a significant factor contributing to the current market sluggishness. This surge is attributed to two primary reasons: the restrictive auction terms imposed by the Cotton Corporation of India (CCI), which are limiting market access for buyers, and a dwindling supply of private cotton stock. Both factors are contributing to a tightening of supply, thereby fueling further price increases.