Posted on August 10, 2025
The yarn industry, a vibrant cornerstone of crafting and textile production, is facing new challenges and opportunities in 2025 due to sweeping U.S. tariffs on imports. Whether you’re a knitter, crocheter, or a small business owner running a local yarn store, these changes are likely to affect your sourcing, pricing, and creative projects. In this blog, we dive into the latest tariff developments, their impact on the yarn market, and what local and international news is saying about the future of yarn. Let’s unravel the details
Understanding the 2025 Tariffs: What’s Happening?
In early 2025, the U.S. implemented significant tariffs on imported goods from numerous countries, with rates ranging from 10% to 50%. These tariffs, part of a broader trade policy under the Trump administration, aim to address trade imbalances and encourage domestic production. However, they’re causing ripples across industries, including textiles and yarn. Here’s a snapshot of the key tariff changes affecting yarn:
- Synthetic Yarns and Fibers (HTS Codes 5401 and 5402): As of February 2025, tariffs on man-made filament yarns (HTS 5401) and staple fibers (HTS 5402) have increased costs by 25% for imports from Canada and an additional 10% from China. These materials are critical for industrial applications like cable manufacturing and consumer products like knitting yarns.
- Cotton Yarn and Apparel: Approximately 95% of apparel sold in the U.S. is imported, with major suppliers like China (30%), Vietnam (13%), and India (8%) facing tariffs of 20-25%. This directly impacts cotton and blended yarns used in knitwear and clothing production.
- De Minimis Exemption Ending: Starting August 29, 2025, the U.S. will eliminate the $800 duty-free threshold for small shipments, known as the de minimis exemption. This change hits small yarn shops and online retailers like Shein and Temu, which previously relied on this exemption to keep costs low.
These tariffs, set to take effect on August 7, 2025, for 69 countries, are creating a complex landscape for yarn importers, manufacturers, and consumers.
Local Impact: Yarn Shops Feel the Squeeze
Local Impact: Yarn Shops Feel the Squeeze
Local yarn stores across the U.S. are bracing for the impact of these tariffs, as yarn is often sourced globally from countries like China, India, Vietnam, and Turkey. In Roanoke, Virginia, shop owners like Robin Ferguson of Knittin’ Coop and Ellie Boylan of House Mountain Yarn Company are navigating rising costs. Ferguson has stopped ordering certain product lines to avoid tariff-driven price hikes, while Boylan was caught off guard by a $19 bag jumping to $35 due to unexpected tariff fees on Chinese-made goods.
Boylan noted the challenge of balancing affordability with quality: “I want to make crafting accessible, but with tariffs, that’s in jeopardy.” Even when sourcing from U.S. brands, many yarns rely on foreign bases or components, such as knitting needles manufactured in China but distributed through American companies. This interconnected supply chain means that even “buy local” strategies aren’t tariff-proof.
In San Francisco’s Chinatown, small businesses that sell specialty yarns alongside other goods are also struggling. A 145% tariff on Chinese imports has led to price spikes on essentials like teas and sauces, and yarn shops fear similar impacts. Assemblymember Matt Haney highlighted that these tariffs could devastate iconic neighborhoods reliant on imported goods, with some stores seeing sales drop by 20%.
International News: A Global Yarn Market in Flux
Globally, the yarn market is reacting to the U.S. tariffs with a mix of concern and adaptation:
- India’s Cotton Yarn Market: In North India, cotton yarn prices in markets like Delhi, Ludhiana, and Panipat have remained stable, but demand is subdued due to a 25% U.S. tariff on Indian exports. Buyers are delaying orders or seeking discounts, wary of reduced competitiveness compared to countries like Bangladesh, which secured a lower 20% tariff.
- Polyester Industrial Yarn: : The polyester yarn market saw significant price fluctuations last week due to tariff uncertainty, though volatility has since narrowed. Importers are exploring alternative suppliers like Vietnam (54,812 metric tons imported in 2023) and South Korea (31,569 metric tons) to offset the 35% tariff on Chinese polyester yarns.
- Trade Negotiations: Countries like South Korea and the EU have negotiated lower tariffs (15% each), while Mexico secured a 90-day reprieve to maintain its 25% tariff rate. China faces a looming August 12 deadline to finalize a trade deal, with a potential 55% tariff if talks fail. These negotiations could reshape global yarn supply chains.
The International Textile Manufacturers Federation warns that these tariffs will significantly disrupt apparel and textile imports, particularly since the U.S. relies heavily on foreign yarn and fabrics.
What This Means for Yarn Enthusiasts and Businesses
For crafters, the tariffs could mean higher prices for your favorite yarns, especially those imported from Asia or made with foreign components. A skein of merino wool or cashmere might see a 10-20% price increase, as seen in the knitwear industry. Small yarn shops, already operating on slim margins, may have to pass these costs on to customers or limit their inventory, potentially reducing variety.
However, there’s a silver lining. The tariffs are spurring interest in domestic yarn production. While U.S. capacity for synthetic yarns is currently limited, some manufacturers are modernizing facilities to capture market share. This could lead to more “Made in the USA” yarns in the future, though scaling up will take time and investment.
Tips for Navigating the Tariff Landscape
- Explore Local and Regional Yarns: Support indie dyers and U.S.-based yarn companies, but check their sourcing—some use overseas bases. Local yarns may cost more upfront but could avoid tariff-driven spikes.
- Stock Up Strategically: If you rely on imported yarns, consider purchasing before August 29, when the de minimis exemption ends, to lock in current prices.
- Stay Informed: Follow trade news on platforms like TariffCheck.org for real-time updates on tariff rates and exemptions. Coffee and cocoa may be exempt, so keep an eye out for potential yarn exemptions too.
- Diversify Your Stash: Experiment with yarns from countries with lower tariffs, like South Korea or the EU, to balance cost and quality.
- Advocate and Connect: Join crafting communities to share tips and advocate for policies that support small businesses and affordable yarn access. Local yarn stores are gathering places—support them to keep the community thriving
Looking Ahead: A Resilient Yarn Community
The 2025 tariffs are undoubtedly shaking up the yarn industry, from local shops in Virginia to global markets in India and China. While higher prices and supply chain shifts pose challenges, they also open doors for innovation and domestic growth. As crafters and business owners, staying informed and adaptable will be key to keeping your projects vibrant and your shelves stocked.
What are your thoughts on these changes? Are you seeing price hikes at your local yarn store, or are you exploring new sourcing options? Share your experiences in the comments below, and let’s keep the conversation going! For the latest updates, subscribe to our newsletter or follow us on social media.
Sources: U.S. Census Bureau, International Textile Manufacturers Federation, TariffCheck.org, local news reports
