Cotton yarn in India has risen about 60% in 2026. Raw cotton is up about 24% in six months. If you buy clothes, this reaches you soon. Here is what is happening, in plain numbers.
What moved
- India's cotton crop fell 2.35% to 290 lakh bales (170 kg each) in 2025-26.
- Raw cotton prices rose about 24% over the six months to September 2026.
- Cotton yarn, the thread fabric is knitted from, rose about 60% this year.
The 31 October deadline
To ease supply, the government removed the 11% import duty on raw cotton from 1 June to 31 October 2026. Mills and exporters have asked for six more months. Farmers want the window closed, because cheap imports during harvest push down what they are paid.
Both sides have a point. If the waiver ends, mills lean harder on domestic cotton in a short crop year, and yarn prices have little reason to fall. If it is extended, fabric costs may steady, but growers carry the cost.
Why tax will not save the price
Since 22 September 2025, clothing up to ₹2,500 a piece carries 5% GST and anything above carries 18%. That cut helped shoppers last year. It does nothing for the cost of the cloth itself, which is where this year's increase sits.
What to expect
Brands have three choices: raise prices, use less or cheaper cotton, or absorb the cost. The second is the one you cannot see. A tee that quietly drops from 210 gsm to 180 gsm looks the same on a hanger and very different after ten washes.
What we are doing
When our next batch is costed, we will publish what the cotton cost us and what that means for the price.