24-04-2025
Weavers expect cheaper Chinese rayon yarn amid US tariffs
At Palladam, located 40 km from Coimbatore city, weavers who produce rayon fabrics are looking forward to yarn that costs ₹8 to ₹10 per kg less than what is available in the market now. Powerloom weavers in Erode district, who also produce rayon fabric, are similarly hopeful.
With US President Donald Trump imposing a 145 % tariff on Chinese goods, Chinese viscose yarn is expected to be available at the weaving clusters in Tamil Nadu at prices lower than the yarn spun at textile mills in the State.
Govindaraj of the Shuttleless Loom Cloth Manufacturers Association informed The Hindu on Thursday that several traders have reportedly booked Chinese yarn, which will be available to weavers at approximately ₹8 per kg less than Indian yarn. However, the weavers will not receive a credit period for payment and will have to purchase large quantities of yarn. As a result, the actual price difference will be around ₹4 per kg less than Indian yarn. He noted that this situation will have an impact on viscose textile mills.
Velusamy, President of the Palladam Job Working Powerloom Unit Owners Association, said the imported yarn is likely to arrive only after a month, since the traders have only just begun placing orders. While smaller weavers may lack the resources to import directly, larger weaving units are expected to take advantage of the price differential.
A viscose spinner in Pallipalayam explained that the landed cost of Chinese viscose yarn had dropped from ₹192.17 per kg on April 1 to ₹185.06 per kg on April 23, while yarn produced in India costs ₹197 per kg. The price of Chinese yarn is cheaper by nearly ₹12 after the US levied reciprocal tariffs.
In 2023, India imported 77,765 tonnes of viscose yarn, the quantity of which reduced to 22,237 tonnes in 2024. Between January and March this year, India imported a total of 4,317 tonnes of viscose yarn. Domestic spinners can produce 2,200 tonnes of viscose yarn a day.
The yarn will land in India next month and the imports will go up again in 2025.
'The raw material (fibre) to spin viscose yarn is produced by only one company in India, and with a monopoly, this company determines the fibre price. Further, there are Quality Control Order (QCO) restrictions for fibre imports. Fabric imports attract a duty of 20%, and hence, there is not much import of fabrics. It is the spinning industry that is hit because there are no QCO restrictions for yarn imports,' the spinner said.
The viscose yarn producing textile mills have called for restrictions on Chinese yarn imports and demanded the removal of QCO on viscose fibre or levy of the QCO norms on yarn too.
