Fast Retailing Co., owner of the Uniqlo apparel chain, is closely monitoring to see if Chinese demand for its products is affected by Chairman Tadashi Yanai’s reported comment that the company isn’t using cotton from Xinjiang.

Fast Retailing shares fell initially today by as much as 4.5% before recovering slightly to 1.3% down by the time the market closed in Tokyo, following reports of a Beijing backlash against the company.

Casual wear giant Uniqlo is facing calls for a consumer boycott in China after the CEO of the clothing company's owner said it does not source cotton from China's Xinjiang, which has faced allegations of forced labour in recent years.

Uniqlo is facing calls for a consumer boycott in China after the company's boss said the Japanese clothing retailer does not source cotton from Xinjiang amid allegations of forced labour in the region.

A Chinese government spokesperson took a softer stance on the hot-button issue, and said businesses that source and manufacture in China "should not be swayed by political pressure."

Uniqlo is facing an online backlash in China after the boss of its parent company said the Japanese clothing retailer does not source cotton from Xinjiang. Fast Retailing's chief executive Tadashi Yanai said Uniqlo was "not using" cotton from the western Chinese province in a BBC interview this week.

Japanese clothing retailer Uniqlo does not use cotton from the Xinjiang region in northwest China, the company's boss said.

Chairman Tadashi Yanai said in BBC interview published this week that Uniqlo doesn’t source cotton from that region of China’s far west, where the US has restricted trade.

The boss of the company behind global fashion chain Uniqlo has told the BBC that the Japanese firm does not use cotton from the Xinjiang region of China in its products. It is the first time Fast Retailing's chief executive Tadashi Yanai has directly addressed the contentious issue.