Xinjiang cotton industry shows resilience as US blacklist fails to rattle traders

A cotton-ginning mill owner in southern Xinjiang dismissed the latest US import blacklist additions as unlikely to significantly affect the sector, signalling a sharp reversal from the anxiety that gripped the region's textile industry four years earlier.

In late July, Washington added 43 Chinese companies to its import blacklist over forced labour allegations in Xinjiang Uygur autonomous region, targeting several well-known food and apparel brands. The announcement triggered what the mill owner described as a "surprisingly calm" local response.

Industry rebounds after years of disruption

"At least for Xinjiang cotton, I feel the industry has weathered the storm," said the mill owner, who requested anonymity. He contrasted the muted reaction to the "panic triggered four years ago, when Xinjiang cotton became a geopolitical flashpoint between Washington and Beijing".

The region's cotton processing capacity has expanded substantially, with local processing rates now reaching 30 to 40 per cent—levels the mill owner characterised as "remarkably high". Development spans the full supply chain, from spinning and weaving to printing and dyeing, with companies "steadily expanding their scale," he added.

Diversification blunts sanction impact

The shift in confidence reflects years of export diversification by Chinese textile firms and a changing power balance between Washington and Beijing, particularly since the trade war that escalated last year. Chinese industries now appear to respond to US sanctions "with greater resilience and confidence," according to the report.

The mill owner's assessment captures what may be a broader transformation in how Chinese manufacturers view Western trade restrictions. "It felt like a sudden batch of companies was added out of nowhere … but it shouldn't have much of an impact on the sector," he said of the July blacklist expansion.

Source: South China Morning Post