In a letter to the Hon’ble Minister, AEPC Chairman Dr. A. Sakthivel expressed gratitude for the Government’s continued support and industry-friendly initiatives and drew attention to the steadily rising prices of raw cotton and cotton yarn amid supply-side constraints. The letter notes that limited stock availability with ginners and reduced arrivals have resulted in mills relying increasingly on CCI auctions. It also highlights that a substantial quantity of cotton has moved from farmers to traders, contributing to hoarding and speculative practices in the market.
Cotton yarn prices have increased by around 60 per cent, from approximately Rs 250 per kg in early 2026 to around Rs 400 per kg currently, further increasing pressure on the apparel manufacturing value chain. Rising costs of other raw materials and fuel are also aggravating the situation.
The letter further highlights the increase in exports of Indian cotton and cotton yarn to apparel-producing countries such as Bangladesh and Vietnam, following restrictions by the US on the use of Chinese cotton under the Uyghur Forced Labor Prevention Act (UFLPA). This has added to the pressure on raw material prices across the garment value chain.
As apparel exporters predominantly procure fabric from the domestic market, the increase in cotton and yarn prices is translating into higher fabric prices and, consequently, higher apparel manufacturing costs. This is affecting the competitiveness of Indian apparel exporters at a time when opportunities are expanding in international markets, particularly in new FTA markets such as the UK and New Zealand.
Need to Prioritise Value-Added Exports
Dr. Sakthivel highlighted the substantially higher value realisation and employment potential associated with exports of finished garments compared with raw cotton and yarn.
The letter notes that raw cotton fetches approximately Rs 275 per kg, while cotton converted into yarn fetches around Rs 325 per kg. In comparison, a kilogram of garments, after value addition, can fetch between Rs 800 and Rs 1,200.
The Chairman also recalled the emphasis of Hon’ble Prime Minister Shri Narendra Modi on promoting exports of value-added products such as garments rather than raw materials, given their greater contribution to value addition and employment in the country.
Dr. Sakthivel said, “We are grateful for the continued support and guidance of the Hon’ble Minister and the Ministry of Textiles. At this critical juncture, ensuring adequate availability of cotton yarn at competitive prices will help our apparel exporters remain competitive and take full advantage of the emerging opportunities in global markets.”
AEPC has humbly requested that suitable measures be considered to regulate the export of cotton yarn, specifically 20s count and above, and to stabilise prices so that cotton yarn remains available to apparel manufacturing and exporting units at competitive rates.
The Council has expressed confidence that the Hon’ble Minister’s kind and urgent intervention in the matter would provide much-needed relief to the apparel export industry and strengthen India’s ability to expand value-added apparel exports globally.
The Apparel Export Promotion Council (AEPC) has respectfully urged Hon’ble Union Minister of Commerce and Industry Shri Piyush Goyal to consider suitable measures to regulate the export of cotton yarn, particularly 20s count and above, in view of the sharp increase in yarn prices and the growing pressure on the competitiveness of India’s apparel export industry. The Council has also sought the intervention and support of Hon’ble Union Minister of Textiles Shri Giriraj Singh on the matter.
