The United States has witnessed a dramatic increase in cotton exports to India in recent months, driven by a unique convergence of global trade dynamics, domestic production shortfalls in India, and shifting tariff landscapes.
Between February and April 2025, U.S. upland cotton exports to India surged to 155,260 running bales, a staggering six-fold increase compared to 25,901 bales shipped during the same period in the previous year. This rise marks the highest export volume in the last two and a half years.
Key Export Data
| Time Period | U.S. Upland Cotton Exports to India (Running Bales) |
|---|---|
| Feb–Apr 2024 | 25,901 |
| Feb–Apr 2025 | 155,260 |
| Year-over-Year % Increase | > 498% |
What’s Driving the Surge?
Several interlinked factors are contributing to this significant uptick in exports:
1. Trade Conflicts and Tariff Realignments
- The ongoing trade dispute between the U.S. and China has redirected American cotton from Chinese markets to alternate destinations.
- China’s imposition of 125% tariffs on U.S. goods has made Indian buyers more appealing to American cotton exporters.
2. Price Dynamics
- A decline in global cotton prices, particularly U.S. upland cotton, has made American fiber more competitively priced.
- Indian mills, facing squeezed margins and a need for quality fiber, have turned to U.S. suppliers to meet demand.
3. India’s Production Woes
- India has transitioned from a net exporter to a net importer of cotton due to declining yields.
- The Cotton Association of India (CAI) has revised its domestic production estimates downward, highlighting a significant shortfall.
- India faces an expected domestic production deficit of 2.5 million bales for the 2024/25 season.
Tariff Relief and Type of Cotton Imported
India’s cotton import patterns are also shaped by its tariff structure:
| Type of Cotton | Duty in India | Remarks |
|---|---|---|
| Extra Long Staple (ELS) | 0% | Exempt from duty; preferred for imports |
| Short Staple | 11% | Subject to import duty |
- India predominantly imports ELS cotton from the U.S., which is used in high-quality textile manufacturing and benefits from a 10% duty exemption, further boosting imports.
Outlook: Doubling Imports in 2024/25
Looking ahead, India’s cotton imports are projected to double in the 2024/25 season, with rising domestic consumption and continued supply constraints. This situation positions the U.S. as a vital supplier for India’s textile and garment sector, especially as the Indian market seeks consistency in both volume and quality.
Conclusion
The surge in U.S. cotton exports to India reflects a reshaping of global trade flows, where geopolitical tensions and domestic agricultural performance play pivotal roles. With India’s production under pressure and its import appetite growing, the U.S. cotton industry stands to gain substantially in the months to come.
Glottis Limited 
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