Weekly Cotton Market Update – Week 9, 2026

RoDTEP cut jolts textile exporters:
Industry associations urged the government to reverse or substantially restore the RoDTEP cut after rates for cotton yarn were reduced from 3.4% to 1.7% FOB, effective 23 February 2026. They said the move hits confirmed export orders and comes just as India is looking to gain from the India-US and India-EU trade deals, with the textile value chain linked to more than 50 million jobs. The issue matters because weaker export rebates can quickly squeeze spinning and textile margins tied to cotton-based production. This suggests policy uncertainty is now becoming a competitiveness risk just when exporters were hoping for a demand-led recovery.

CCI cuts cotton selling price again:
The Cotton Corporation of India (CCI) reduced 2025–26 crop selling prices again by ₹700–₹1,100 per candy of 356 kg, after a previous cut of ₹1,400–₹1,700 per candy on February 10. The move came as MSP procurement reached 98.9 lakh bales of 170 kg, while trade sources said market prices were still ₹500–₹1,000 below CCI levels; imported cotton was quoted at ₹52,000–₹54,000 on port delivery, and domestic prices in Maharashtra and Gujarat were around ₹7,600–₹7,700. The cut matters because CCI’s pricing now has to compete with both domestic spot markets and import parity to move stocks. Net-net, large procurement without matching offtake is forcing a price reset that could shape mill buying behaviour in the weeks ahead.

India-US pact keeps cotton debate alive:
A Reuters explainer said the interim India-US trade framework may lower barriers on some farm goods, but India resisted a broad opening of agriculture. On cotton, it noted India’s 11% import duty could pressure domestic prices if duty-free access expands, though the impact may stay limited because only extra-long staple (ELS) cotton imports are allowed and that too under quota. This matters because the cotton issue is less about bulk imports today and more about how India balances farmer price protection with mill demand for ELS fibre. That likely means trade policy will remain selective, with pressure concentrated in speciality fibre segments rather than the entire market.

RoDTEP cut drags yarn prices lower:
Cotton yarn prices fell 1% to 2% across India by the end of the week, with declines of ₹2–₹5/kg in South India, around ₹3/kg for 30-count carded yarn in Mumbai, and around ₹4/kg for 40-count combed yarn. Capacity utilisation at several spinning units slipped to 75–80%, versus more than 85% in stronger export phases, while fabric and garment buyers stayed cautious on fresh orders. This matters because softer yarn prices and lower mill utilisation directly weaken near-term realizations across the cotton value chain. Expect mills to stay defensive on raw cotton buying until export incentives, cotton prices, and apparel demand show clearer direction.