Report Title - "High-level Fluctuations, Awaits New Cotton Listing" [1] Report Industry Investment Rating - No relevant content provided Core Viewpoints - The cotton market is expected to fluctuate strongly in the short term due to tight spot markets, an improved macro - environment, and consumption expectations for the "Golden September and Silver October." As new cotton is set to be listed in late September with a significant increase in production, there will be a game between cotton farmers and ginners. It is predicted that ginners will purchase relatively cautiously, and there will be greater pressure when a large amount of new cotton is listed around the National Day. The price in September is expected to fluctuate at a high level, and enterprises can seize the opportunity to hedge for new cotton. The basis is expected to remain strong. The cotton yarn market mainly follows cotton prices but faces greater pressure later due to intense industrial chain competition and declining exports [61]. Summary by Directory 1. Market Trend Review - In August, Zhengzhou cotton prices fluctuated at a high level. The tight spot market supported prices, while the expected large increase in Xinjiang cotton production in the new year suppressed the market. Macro - factors such as the Fed's interest - rate cut expectations, a phased Sino - US agreement, and an improved domestic macro - environment were favorable for commodity prices. With the consumption expectations of the "Golden September and Silver October," cotton prices remained high. Cotton yarn mainly followed cotton prices, but due to obvious over - capacity, spinning profits were significantly compressed, and the pressure would increase with the continued expansion of Xinjiang's production capacity [7]. 2. Supply - side Analysis 2.1 Global Supply - Demand Balance - According to the USDA's August global cotton supply - demand forecast report, in the 2025/26 season, global cotton production, consumption, import, and export volumes were all adjusted downward month - on - month, and the ending inventory decreased. In the 2024/25 season, the total global cotton production was expected to be adjusted downward month - on - month, consumption to increase, and exports to decrease, and the ending inventory declined again. In 2025/26, the expected global cotton production was 2539.2 million tons, a month - on - month decrease of 39.1 million tons (1.5%); consumption was 2568.8 million tons, a month - on - month decrease of 3.0 million tons (0.1%); imports were 948.9 million tons, a month - on - month decrease of 23.9 million tons (2.5%); exports were 949.0 million tons, a month - on - month decrease of 24.0 million tons (2.5%); and the global ending inventory was 1609.3 million tons, a month - on - month decrease of 74.2 million tons (4.4%) [13]. 2.2 US Cotton - In 2025/26, the US cotton planting area was 56.311 million mu, a month - on - month decrease of 5.117 million mu; the harvested area was 44.65 million mu, a month - on - month decrease of 7.928 million mu; the abandonment rate was 20.7%, a month - on - month increase of 6.3 percentage points. The expected yield per mu was 64.4 kg, a month - on - month increase of 4.0 kg; the production was 2.877 million tons, a month - on - month decrease of 302,000 tons. Consumption was expected to be 370,000 tons with no obvious month - on - month adjustment; exports were expected to be 2.613 million tons, a month - on - month decrease of 109,000 tons. The ending inventory decreased by 218,000 tons to 784,000 tons [14]. 2.3 Indian Cotton - According to the Indian Cotton Association's July supply - demand balance sheet, in the 2023/24 season, the expected production was 5.72 million tons, a month - on - month increase of 190,000 tons (3.4%); imports were expected to be 258,000 tons, a month - on - month decrease of about 40,000 tons (13.1%). There was no obvious month - on - month adjustment in demand data, and the ending inventory increased by 153,000 tons to 666,000 tons, a month - on - month increase of 29.8%. In the 2024/25 season, the beginning inventory increased to 666,000 tons, and there was no obvious month - on - month adjustment in production and import expectations, which were 5.294 million tons and 663,000 tons respectively. In terms of demand, the expected consumption was 5.338 million tons, a month - on - month increase of 102,000 tons (1.9%); exports were expected to be 306,000 tons, a month - on - month increase of 17,000 tons (5.9%). The ending inventory increased by 34,000 tons to 979,000 tons, a month - on - month increase of 3.6% [20]. 2.4 Brazilian Cotton - CONAB's 2024/25 cotton production forecast data showed that the expected cotton - planting area in Brazil was 2.086 million hectares (about 31.29 million mu), a year - on - year increase of 7.3%; the expected national yield per mu was 125.8 kg, a year - on - year decrease of 0.9%. Based on this, the expected total cotton production in Brazil in 2024/25 was 3.935 million tons, a year - on - year increase of 6.3%. In the 2024/25 season, Brazil exported 2.835 million tons of cotton, a year - on - year increase of 5.8%, setting a new record, and it remained the world's largest cotton exporter, with cumulative revenue of about $4.85 billion. Brazilian cotton was mainly exported to Vietnam, Pakistan, and China, totaling 1.48 million tons [23]. 2.5 Domestic Supply - In the 2025/26 season, the beginning inventory decreased by 120,000 tons to 6.24 million tons. In terms of production, Xinjiang's production increased by 120,000 tons to 6.59 million tons month - on - month, and inland production decreased by 3,000 tons to about 310,000 tons, with the national total production increasing by about 120,000 tons to 6.9 million tons month - on - month. Imports were expected to continue to decrease by 100,000 tons to 1.4 million tons. The total annual supply decreased by 100,000 tons to 14.54 million tons. In terms of total demand, the overall textile cotton demand would remain stable at a relatively high level. The expected annual textile cotton consumption was maintained at 7.9 million tons, and other consumption and exports remained unchanged at 380,000 tons and 20,000 tons respectively, with total demand stable at 8.3 million tons [24]. 2.6 Inventory and Imports - At the end of July, the national commercial cotton inventory was 2.1898 million tons, a decrease of 640,000 tons (22.62%) from the previous month and 588,400 tons (21.18%) lower than the same period last year. As of the end of July, the textile enterprises' in - stock industrial cotton inventory was 898,400 tons, a decrease of 4,600 tons from the end of the previous month. The disposable cotton inventory of textile enterprises was 1.2062 million tons, a decrease of 9,400 tons from the end of the previous month. The total industrial and commercial inventory was 3.0882 million tons, a year - on - year decrease of 497,000 tons. As of August 15, the national commercial cotton inventory was 1.8202 million tons, a decrease of 369,600 tons (16.88%) from the end of July. As of August 15, the textile enterprises' in - stock industrial cotton inventory was 924,200 tons, an increase of 25,800 tons from the end of the previous month. The disposable cotton inventory of textile enterprises was 1.2345 million tons, an increase of 28,300 tons from the end of the previous month. The total industrial and commercial inventory was 2.7444 million tons, a decrease of 343,800 tons from the end of July. In July 2025, China imported 50,000 tons of cotton, a month - on - month increase of 20,000 tons (66.7%) and a year - on - year decrease of 150,000 tons (73.2%). From January to July 2025, China imported 520,000 tons of cotton cumulatively, a year - on - year decrease of 74.2%. In the 2024/25 season (from September 2024 to August 2025), the cumulative cotton imports were 1 million tons, a year - on - year decrease of 67.8%. In July 2025, China imported 110,000 tons of cotton yarn, a year - on - year decrease of about 20,000 tons (16.4%); from January to July 2025, the cumulative cotton - yarn imports were 780,000 tons, a year - on - year decrease of 14%. In the 2024/25 season (from September 2024 to July 2025), the cumulative cotton - yarn imports were about 1.28 million tons, a year - on - year decrease of 17.95% [26][31]. 3. Demand - side Analysis 3.1 Domestic Demand - In July 2025, the total retail sales of consumer goods were 3.878 trillion yuan, a year - on - year increase of 3.7% and a month - on - month decrease of 8.29%. From January to July 2025, the total retail sales of consumer goods were 28.4238 trillion yuan, a year - on - year increase of 4.8%. In July, the retail sales of clothing, footwear, and textile products were 96.1 billion yuan, a year - on - year increase of 1.8% and a month - on - month decrease of 24.63%. From January to July, the cumulative retail sales were 837.1 billion yuan, a year - on - year increase of 2.9% [38]. 3.2 Foreign Demand - In July 2025, China exported $26.766 billion worth of textiles and clothing, a year - on - year decrease of 0.06% and a month - on - month decrease of 2.01%. Among them, textile exports were $11.604 billion, a year - on - year increase of 0.55% and a month - on - month decrease of 3.69%; clothing exports were $15.162 billion, a year - on - year decrease of 0.55% and a month - on - month decrease of 0.69%. From January to July 2025, China exported $170.741 billion worth of textiles and clothing, a year - on - year increase of 0.63%. Among them, textile exports were $82.122 billion, a year - on - year increase of 1.6%; clothing exports were $88.619 billion, a year - on - year decrease of 0.3% [41]. 3.3 Textile Industry Inventory - In June, the inventory of the textile industry was 401.53 billion yuan, a month - on - month increase of 0.30% and a year - on - year increase of 1.12%. The finished - product inventory of the textile industry was 215.3 billion yuan, a month - on - month increase of 1.18% and a year - on - year increase of 2.42%. The inventory of textile and clothing was 187.98 billion yuan, a month - on - month increase of 0.78% and a year - on - year decrease of 0.36%. The finished - product inventory of textile and clothing was 99.31 billion yuan, a month - on - month increase of 2.25% and a year - on - year increase of 1.68% [43]. 3.4 US Retail Sales and Inventory - In June 2025, the retail sales of clothing and clothing accessories in the US (seasonally adjusted) were $26.342 billion, a year - on - year increase of 3.88% and a month - on - month increase of 0.94%. In May 2025, the inventory of clothing and clothing - accessory retailers in the US (seasonally adjusted) was $58.056 billion, a year - on - year increase of 0.98% and a month - on - month decrease of 0.49%. The inventory - to - sales ratio of US clothing and clothing - accessory retailers in May 2025 (seasonally adjusted) was 2.22, a year - on - year decrease of 0.06 and a month - on - month decrease of 0.02 [48]. 3.5 Industrial Chain Operation - In the cotton - yarn market, downstream procurement increased, and the overall performance improved slightly but was still mediocre. In terms of price, spinners' quotes increased slightly, and downstream gradually digested them, but the acceptance of high prices was poor. In terms of profit, there was little change. Currently, the cash - flow loss of inland spinners for C32S was about 500 yuan/ton, while Xinjiang spinners still had a small profit. In terms of inventory and operation, the transaction in the pure - cotton yarn market continued, and spinners continued to reduce inventory slightly. There was little change in the operation rate this week, and inland spinners continued to limit production. In the all - cotton grey - cloth market, the demand improved slightly, and the order volume of all - cotton weavers increased slightly, mainly small and scattered orders, and the recovery speed was lower than expected. This week, the operation rate of all - cotton grey - cloth increased slightly, the sales volume increased slightly, and weavers reported maintaining production - sales balance, with the current inventory decreasing slightly. It was reported that the order volume in the Nantong home - textile market was insufficient, the competition among weavers was fierce, and the operation - rate recovery was insufficient. The knitting orders in the Foshan area continued, but the operation - rate recovery was limited. The order - receiving situation of weavers in the northern region was average. Weavers generally had little confidence in September, and the marginal improvement in raw - material procurement enthusiasm was limited, generally maintaining just - in - time purchasing [51]. 4. Logic and Outlook - Cotton is expected to fluctuate strongly in the short term, and enterprises can hedge for new cotton. The basis is expected to remain strong. Cotton yarn mainly follows cotton prices but faces greater pressure later due to intense competition in the industrial chain and declining exports [61].

Report Industry Investment Rating No information provided in the content. Core Viewpoints of the Report - Short - term, domestic cotton supply is tightening. With the arrival of the peak season and the possibility of a scramble for new cotton, Zhengzhou cotton futures may show a volatile and upward trend before the large - scale listing of new cotton. Medium - term, due to strong expectations of a bumper harvest in the new year, the futures market will face significant pressure during the centralized listing period. Attention should be paid to the actual demand during the peak season. If the peak - season demand fails to meet expectations, Zhengzhou cotton may still decline. Long - term, cotton prices are expected to be positive. After the seasonal pressure eases, it is advisable to look for opportunities to go long on dips [4]. Summary According to the Directory Tariff Policy Impact Analysis - On May 12, China and the US issued a joint statement in Geneva, canceling 91% of the mutually imposed tariffs. However, the overall tariff level on Chinese textiles in the US remains high, and there is still an additional 25% tariff on US cotton imported by China. The extension of the tariff truce for 90 days has a limited positive impact on export trade. The US - India trade friction also affects the cotton market. India's temporary cancellation of cotton import tariffs has limited positive effects due to the short time period [9][10][14]. International Cotton Market Supply - Demand Analysis Global - In August, the USDA significantly reduced the global cotton production and ending stocks for the 25/26 season in its supply - demand report, changing the supply - demand situation from loose to tight. However, this adjustment is controversial as it may not fully reflect the production potential of some countries and lacks strong support on the demand side [15]. United States - The NASS's August report shows a reduction in cotton planting and harvest areas in the US, with the 25/26 season's production dropping to 288 tons. Exports and ending stocks are also down, improving the supply - demand outlook. But some market participants think the adjustment may be too radical, and the reduction in supply needs further observation [18][19]. Brazil - The USDA predicts that Brazil's new - season cotton production will increase by 27 tons to 397 tons, with export expectations exceeding 3 million tons. Brazil has replaced the US as the world's largest cotton exporter, and its increasing production will further pressure US cotton [27][29]. India - For the 24/25 season, different institutions have different estimates of India's cotton production. For the 25/26 season, the USDA reduced India's consumption and increased ending stocks. Currently, India's new - cotton sowing progress is slower than usual, and there are uncertainties in the final planting area and output [32]. Domestic Cotton Market Supply - Demand Analysis USDA - In August, the USDA increased China's new - season cotton production and consumption while reducing imports and ending stocks. However, it may still underestimate China's cotton production [35]. BCO - The Cotton Information Network continued to lower China's ending stocks. For the 24/25 season, production remained stable, imports decreased, and consumption increased. For the 25/26 season, production increased, imports decreased, and consumption remained stable, with ending stocks also decreasing [38]. Production - Domestic institutions' estimates of China's total cotton production are around 6.9 million tons, but the market expects a higher output, especially in Xinjiang, where a bumper harvest is likely [41]. Import - Due to limited additional import quotas and high domestic production, China's cotton imports have been low. The recent issuance of 200,000 tons of sliding - scale duty import quotas is unlikely to ease the short - term supply shortage in Xinjiang [44]. Inventory - China's domestic cotton commercial inventory has been decreasing rapidly and is at a historically low level, which strongly supports domestic cotton prices [46]. Textile Industry Chain - Since August, the demand side has improved marginally, but the improvement is limited. The peak - season demand may not be strong. Yarn mills' sales have improved slightly, but profits are still poor. Weaving mills' orders have increased slightly, and their raw - material procurement enthusiasm is limited [52]. Future Cotton Market Outlook ICE US Cotton - The new US tariffs are not conducive to global textile trade. India's temporary cancellation of cotton import tariffs has limited positive effects. The USDA's adjustment of the supply - demand situation is beneficial to cotton prices, but the reduction in production needs further verification. In the short term, ICE US cotton may be trapped in the 65 - 70 cent trading range. In the medium - to long - term, attention should be paid to the realization of the production - reduction expectation [60]. Domestic Zhengzhou Cotton - The "anti - involution" in China has ended, and the tariff truce has been extended for 90 days, but macro risks remain. The short - term supply shortage persists, and the peak - season demand improvement provides support for cotton prices. However, the large - scale listing of new cotton may bring hedging pressure. In the medium - to long - term, attention should be paid to tariff policies and the realization of the domestic production - increase expectation [61].

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - The overall assessment of cotton investment is complex. The fundamentals are neutral, with different data sources showing varying production, consumption, and inventory figures. The basis is bullish, the inventory is bearish, the market trend is bullish, the main position is bullish, and there are differences in the market's expectations for the peak season of "Golden September and Silver October." If the Zhengzhou cotton main contract 01 can stand above 14,000, the probability of subsequent volatile upward movement increases; otherwise, if it falls below 14,000, the downward space will open [4]. - There are both bullish and bearish factors in the market. Bullish factors include the reduction of previous mutual tariffs between China and the US, a year - on - year decrease in commercial inventory, and an enhanced expectation for the peak consumption season of "Golden September and Silver October." Bearish factors include the postponement of trade negotiations, currently high export tariffs to the US, a decline in overall foreign trade orders, an increase in inventory, and the upcoming large - scale listing of new cotton [5]. Summary by Directory 1. Previous Day's Review No relevant content provided. 2. Daily Tips - **Fundamentals**: According to ICAC's August report, the production in the 2025/26 season is 25.9 million tons, and consumption is 25.6 million tons. According to USDA's August report, the production in the 2025/26 season is 25.392 million tons, consumption is 25.688 million tons, and the ending inventory is 16.093 million tons. In July, textile and clothing exports were $26.77 billion, a year - on - year decrease of 0.1%. In July, China imported 50,000 tons of cotton, a year - on - year decrease of 73.2%, and imported 110,000 tons of cotton yarn, a year - on - year increase of 15.38%. According to the Ministry of Agriculture's August forecast for the 2025/26 season, production is 6.25 million tons, imports are 1.4 million tons, consumption is 7.4 million tons, and the ending inventory is 8.23 million tons [4]. - **Basis**: The national average price of spot 3128b is 15,334 yuan, and the basis is 1,234 yuan (for the 01 contract), with a premium over futures [4]. - **Inventory**: The Ministry of Agriculture of China estimates the ending inventory in the 2025/26 season to be 8.23 million tons in August [4]. - **Market Trend**: The 20 - day moving average is flat, and the K - line is above the 20 - day moving average [4]. - **Main Position**: The position is bullish, the net long position increases, and the main trend is unclear [4]. - **Expectations**: The main contract 01 of Zhengzhou cotton retraced to the 14,000 mark again during the night session. There are differences between the long and short sides regarding the expectation of the peak season of "Golden September and Silver October" [4]. 3. Today's Focus No relevant content provided. 4. Fundamental Data - **USDA Global Cotton Supply - Demand Forecast**: In August, the total global production was 25.392 million tons, a month - on - month decrease of 391,000 tons and a year - on - year decrease of 2%. Total global consumption was 25.688 million tons, a month - on - month decrease of 30,000 tons and a year - on - year increase of 0.4%. Total global imports were 9.489 million tons, a month - on - month decrease of 239,000 tons and a year - on - year increase of 2%. Total global exports were 9.49 million tons, a month - on - month decrease of 240,000 tons and a year - on - year increase of 3%. The total global ending inventory was 16.093 million tons, a month - on - month decrease of 747,000 tons and a year - on - year decrease of 2.4% [9][10]. - **ICAC Global Cotton Supply - Demand Balance Sheet**: In the 2025/26 season, global production is 25.9 million tons, an increase of 400,000 tons (+1.6%) year - on - year; global consumption is 25.6 million tons, basically flat year - on - year; the ending inventory is 17.1 million tons, an increase of 260,000 tons (+1.6%) year - on - year; the global trade volume is 9.7 million tons, an increase of 360,000 tons (+3.9%) year - on - year; the price forecast (Cotlook A index) is 57 - 94 cents per pound (median 73 cents) [11]. - **Ministry of Agriculture's Forecast for China**: In the 2025/26 season, the initial inventory is 8.01 million tons, the sown area is 2.878 million hectares, the harvested area is 2.878 million hectares, the yield per hectare is 2,172 kg, the production is 6.25 million tons, imports are 1.4 million tons, consumption is 7.4 million tons, and the ending inventory is 8.23 million tons. The average domestic cotton 3128B price is expected to be 15,000 - 17,000 yuan per ton, and the Cotlook A index is expected to be 75 - 100 cents per pound [13]. 5. Position Data No relevant content provided.

Industry Investment Rating - No investment rating for the industry is provided in the report. Core Viewpoints - The Zhengzhou cotton main contract 01 shows signs of stabilizing and starting to rise after a short - term battle around 14,000. Optimistic expectations may prevail regarding whether the "Golden September and Silver October" peak season will be prosperous. If it can stabilize above 14,000, the probability of subsequent volatile upward movement increases [4]. Summary by Directory 1. Previous Day's Review - No content related to the previous day's review is provided in the report. 2. Daily Hints - **Fundamentals**: According to the ICAC August report, the 2025/26 cotton production is 25.9 million tons and consumption is 25.6 million tons. The USDA August report shows that the 2025/26 production is 25.392 million tons, consumption is 25.688 million tons, and the ending inventory is 16.093 million tons. In July, textile and clothing exports were $26.77 billion, a year - on - year decrease of 0.1%. China's cotton imports in July were 50,000 tons, a year - on - year decrease of 73.2%; cotton yarn imports were 110,000 tons, a year - on - year increase of 15.38%. The Ministry of Agriculture's August forecast for the 2025/26 season is a production of 6.25 million tons, imports of 1.4 million tons, consumption of 7.4 million tons, and an ending inventory of 8.23 million tons, presenting a neutral situation [4]. - **Basis**: The national average price of spot 3128b is 15,235 yuan, with a basis of 1,115 yuan (for the 01 contract), indicating a premium over futures, which is bullish [4]. - **Inventory**: The Ministry of Agriculture's forecast for China's ending inventory in the 2025/26 season in August is 8.23 million tons, which is bearish [4]. - **Market**: The 20 - day moving average is flat, and the K - line is above the 20 - day moving average, which is bullish [4]. - **Main Position**: The position is bullish, but the net long position is decreasing, and the main trend is unclear; still bullish [4]. 3. Today's Focus - No content related to today's focus is provided in the report. 4. Fundamental Data - **USDA Global Cotton Supply - Demand Forecast**: Data on production, consumption, imports, exports, and ending inventory of major cotton - producing and consuming countries from 2021/22 to 2024/25 (July and August statistics) are presented, along with monthly adjustments, year - on - year percentages, and year - on - year changes [9][10]. - **ICAC Global Cotton Supply - Demand Balance Sheet**: In the 2025/26 season, global production is 2.59 million tons (+400,000 tons, +1.6%), consumption is 2.56 million tons (basically flat), ending inventory is 1.71 million tons (+260,000 tons, +1.6%), global trade volume is 970,000 tons (+360,000 tons, +3.9%), and the price forecast (Cotlook A index) is 57 - 94 cents per pound (median 73 cents) [11]. - **Ministry of Agriculture's China Cotton Forecast**: For the 2025/26 season, the estimated beginning inventory is 8.01 million tons, production is 6.25 million tons, imports are 1.4 million tons, consumption is 7.4 million tons, and ending inventory is 8.23 million tons. The domestic average price of cotton 3128B is expected to be in the range of 15,000 - 17,000 yuan per ton, and the Cotlook A index is expected to be in the range of 75 - 100 cents per pound [13]. 5. Position Data - No content related to position data is provided in the report.

Report Industry Investment Rating - Not provided in the content Core Viewpoint - Cotton is in a stage of oscillating downward, and the price center is expected to decline in the later stage. The overall market remains under pressure, and it is recommended to go short after rebounds [7]. Summary by Directory Domestic Supply and Demand Situation - **Supply and Demand Balance**: Since the 2021/22 season, due to the impact of the macro - economy and the pandemic, cotton consumption has been frustrated, while production has remained at a relatively high level. The domestic cotton market has shifted from destocking to inventory accumulation, and the price center has moved down. In the 2024/25 season, production was at a high level, imports decreased, and demand was relatively stable, with sufficient supply. In the 2025/26 season, production is expected to be optimistic, but demand still faces pressure, and the supply - demand situation is expected to remain loose [13]. - **New Cotton Growth**: In 2024, the cotton planting area decreased slightly, but the yield per unit was good, and the output reached a high in recent years. In 2025, the intended planting area increased, the weather in the producing areas was generally good, and there was a strong expectation of a bumper harvest. Currently, the new cotton is growing well, but attention should be paid to the weather in the producing areas [19]. - **Inventory Situation**: The 2023/24 season had sufficient cotton supply and a high carry - over inventory. At present, it is in the destocking period, with significant destocking of commercial inventory. However, industrial inventory has remained at a high level, and the overall industrial and commercial inventory is still relatively high. As of the end of July, the commercial inventory was 218.98 million tons, a decrease of 64 million tons from the previous month; the industrial inventory was 89.84 million tons, a decrease of 0.46 million tons from the previous month [23][24]. - **Import Situation**: The issue of Xinjiang cotton has affected the domestic cotton - using pattern. In 2024, the issuance of sliding - scale duty quotas was less than expected, and cotton imports showed a downward trend. In June 2025, China's cotton imports were 30,000 tons, a decrease of 25.0% from the previous month and 82.1% from the same period last year. From January to June 2025, the cumulative cotton imports were 460,000 tons, a year - on - year decrease of 74.3% [34][43]. Downstream Demand - **Demand Status**: Overseas interest - rate cuts are still uncertain, and the US tariff policy is also uncertain. The domestic policy is boosting the economy, but the demand recovery still needs to be tracked. Although downstream orders for gauze have improved recently, overall orders are still insufficient, the operating load is low, and the finished product inventory is high [47]. - **Retail and Export Data**: In July 2025, the retail sales of clothing, footwear, and knitted textiles were 9.61 billion yuan, a year - on - year increase of 1.8% and a month - on - month decrease of 24.63%. From January to July, the cumulative retail sales were 83.11 billion yuan, a year - on - year increase of 2.9%. In July 2025, China's textile and clothing exports were 2.6766 billion US dollars, a year - on - year decrease of 0.06% and a month - on - month decrease of 2.01%. From January to July, China's textile and clothing exports were 17.041 billion US dollars, a year - on - year increase of 0.63% [50]. Global Supply and Demand Situation - **Global Balance**: In the 2024/26 season, global cotton production is expected to increase, consumption will also recover significantly, and the inventory - to - consumption ratio will rise slightly. In the 2025/26 season, global cotton production is expected to decline, demand will be stable, and the ending inventory will decrease [71]. - **US Situation**: In the 2024/25 season, the planting area of US cotton increased, the harvest area increased significantly, but the yield per unit decreased due to drought, and the output increased. In the 2025/26 season, the planting area decreased, the yield per unit is expected to decline, and the output is expected to recover. US textile and clothing demand has recovered to some extent, but subsequent demand still needs to be tracked. Last week, US cotton export sales rebounded [72][73]. Spread and Basis - **Spread**: The report shows the 1 - 5, 5 - 9, and 9 - 1 spreads of cotton, and the data changes over time [100]. - **Basis**: The report presents the basis of cotton contracts 01, 05, and 09, and the data changes over time [102].

Report Summary 1. Report Industry Investment Rating No information provided in the report. 2. Core Viewpoints - The fundamentals of cotton present a neutral outlook. The 25/26 annual production and consumption data from different institutions show a relatively balanced supply - demand situation. The market is expected to enter the "Golden September and Silver October" consumption peak season, and if the Zhengzhou Cotton 01 contract can hold above the 14,000 mark, there will be further upward momentum. In the short term, it will fluctuate in the range of 14,050 - 14,250 [4]. - There are both positive and negative factors in the market. Positive factors include the reduction of previous mutual tariffs between China and the US and a year - on - year decrease in commercial inventory. Negative factors are the postponement of trade negotiations, high current export tariffs to the US, the off - season of consumption, a decline in overall foreign trade orders, an increase in inventory, and the upcoming large - scale listing of new cotton [5]. 3. Summary by Directory 3.1 Previous Day's Review No information provided in the report. 3.2 Daily Tips - **Fundamentals**: Different institutions' reports on the 25/26 annual cotton production and consumption data vary. For example, the ICAC 8 - month report shows a production of 25.9 million tons and consumption of 25.6 million tons; the USDA 8 - month report shows a production of 25.392 million tons, consumption of 25.688 million tons, and an ending inventory of 16.093 million tons. Customs data shows that in July, textile and clothing exports were $26.77 billion, a year - on - year decrease of 0.1%. China's cotton imports in July were 50,000 tons, a year - on - year decrease of 73.2%, and cotton yarn imports were 110,000 tons, a year - on - year increase of 15.38%. The Ministry of Agriculture's 25/26 annual data shows a production of 6.25 million tons, imports of 1.4 million tons, consumption of 7.4 million tons, and an ending inventory of 8.23 million tons [4]. - **Basis**: The national average price of spot 3128b is 15,234, and the basis for the 01 contract is 1109, indicating a premium over futures, which is a bullish signal [4]. - **Inventory**: The Ministry of Agriculture's forecast of the ending inventory in July for the 25/26 annual is 8.23 million tons, which is a bearish factor [4]. - **Market Trend**: The 20 - day moving average is upward, and the K - line is above the 20 - day moving average, showing a bullish trend [4]. - **Main Position**: The position is bullish, but the net long position has decreased. The main trend is bullish [4]. - **Expectation**: With the approaching of the "Golden September and Silver October" consumption peak season, the market sentiment is optimistic. If the Zhengzhou Cotton 01 contract can stabilize above the 14,000 mark, there will be further upward momentum. In the short term, it will fluctuate in the range of 14,050 - 14,250 [4]. 3.3 Today's Focus No information provided in the report. 3.4 Fundamental Data - **USDA Global Cotton Supply - Demand Forecast**: The report provides the production, consumption, import, export, and ending inventory data of major cotton - producing and consuming countries from 2021/22 to 2024/25 (July and August data), as well as the monthly adjustments and year - on - year changes [10][11]. - **ICAC Global Cotton Supply - Demand Balance Sheet**: In the 2025/26 annual, the global production is 2.59 million tons, an increase of 400,000 tons (+1.6%); consumption is basically flat at 2.56 million tons; the ending inventory is 1.71 million tons, an increase of 260,000 tons (+1.6%); the global trade volume is 970,000 tons, an increase of 360,000 tons (+3.9%); the price forecast (Cotlook A index) is 57 - 94 cents per pound (median 73 cents) [12]. - **Ministry of Agriculture's Data**: From 2023/24 to 2025/26 (July forecast), data such as the beginning inventory, sowing area, harvest area, yield per unit area, production, import, consumption, ending inventory, domestic cotton 3128B average price, and Cotlook A index are provided [14]. 3.5 Position Data No information provided in the report.

1. Report Industry Investment Rating No relevant content provided. 2. Report's Core View - The USDA August report shows a significant reduction in the US cotton planting and harvest areas due to drought, leading to a 302,000 - ton decrease in US cotton production to 2.877 million tons, while China's cotton production increases by 108,000 tons to 6.858 million tons, and global cotton production decreases by 391,000 tons month - on - month [6]. - Cotton demand is weak. Cotton prices are weaker than cotton yarn this week, with weak spot transaction prices. Spinning mills' inventory pressure has eased, and weaving mills' weekly stocking willingness has slightly increased [6]. - Cotton inventory is decreasing. The BCO reported that the cotton social inventory at the end of July was 2.1898 million tons, a decrease of 640,000 tons from the end of June and a 21% year - on - year decline. The destocking speed is accelerating [6]. - The strategy is that there may be one more decline in the short - term for single - side trading, but in the medium - term, it is advisable to buy Zhengzhou cotton at low prices after the concentrated supply pressure is realized, as the USDA report is unexpectedly bullish and has established the lower support for US cotton [6]. 3. Summary by Relevant Catalogs 01 Weekly Core Points and Strategies - **Supply**: The USDA August report shows that the US cotton planting area is reduced by 8% to 9.3 million acres, and the harvest area is reduced by 15% to 7.4 million acres. The national cotton abandonment rate rises from 14% to 21% due to drought in the Southwest. US cotton production decreases by 302,000 tons to 2.877 million tons, China's production increases by 108,000 tons to 6.858 million tons, and global production decreases by 391,000 tons month - on - month [6]. - **Demand**: Cotton prices are weaker than cotton yarn this week, with weak spot transaction prices. In the off - season, spinning mills' stocking willingness remains low, and their inventory pressure has eased. Weaving mills' weekly stocking willingness has slightly increased, and their inventory pressure has also decreased. Spinning profits have slightly expanded, and the loss in inland areas has decreased [6]. - **Inventory**: The BCO reported that the cotton social inventory at the end of July was 2.1898 million tons, a decrease of 640,000 tons from the end of June and a 21% year - on - year decline. The destocking speed is the fastest this year. Spinning mills' industrial cotton inventory continues to decline. Inland yarn mills' operation rate is still weak, with high finished - product inventory and decreasing raw - material inventory in the industrial chain [6]. - **Warehouse Receipts**: As of August 15, the registered warehouse receipts of Zhengzhou cotton are 7,829, with 249 valid forecasts, and the total of warehouse receipts and valid forecasts is 323,100 tons, the same as on August 8 [6]. - **Basis**: The basis quotation for sales in Xinjiang remains firm, and the spot transaction price drops with the futures price. The basis transaction price of machine - picked cotton in the Aksu area of southern Xinjiang for the 09 contract is 1,200 - 1,350 yuan/ton [6]. - **Cost**: The average cost of ginning mills this year is 14,700 - 14,800 yuan. With some ginning mills in northern Xinjiang exiting and the poor overall demand outlook, the expected opening price for the new season is not high [6]. - **Macro**: Domestically, the economy shows a weak recovery pattern with insufficient effective demand. Overseas, the US economy is still in a downward channel, and the market expects the Fed to cut interest rates twice in 2025, with the first cut likely in September with a probability of over 90% [6]. - **Strategy**: There may be one more decline in the short - term for single - side trading, but in the medium - term, it is advisable to buy Zhengzhou cotton at low prices after the concentrated supply pressure is realized [6]. 02 Weekly Data Charts - **Global Supply - Demand Balance Sheet**: From 2020/21 to 2025/26 (August), the global cotton supply - demand situation shows changes in various aspects such as initial inventory, production, import, total supply, export, consumption, total consumption, ending inventory, and inventory ratio. For example, the global production in 2025/26 (August) is 25.392 million tons, a year - on - year decrease of 548,000 tons [10]. - **Global Main Producing Countries' Production Changes**: The production of main cotton - producing countries like China, the US, India, etc., shows different trends from 2020/21 to 2025/26. For example, China's production in 2025/26 is 6.858 million tons, a year - on - year decrease of 1.56% [11]. - **Global Main Producing Countries' Demand Changes**: The consumption of main cotton - consuming countries shows different trends from 2020/21 to 2025/26. For example, global consumption in 2025/26 is 25.688 million tons, a year - on - year increase of 0.02% [12]. - **US Cotton**: The overall US inventory cycle is transitioning from passive destocking to active restocking. The clothing inventory of US wholesalers and retailers is shifting from three - year destocking to moderate active restocking. However, due to factors such as the Geneva Economic and Trade Talks and tariff relaxation, the continuous restocking behavior is somewhat weakened [18]. - **Domestic Situation**: The new - season domestic cotton planting area is expected to expand, maintaining a pattern of loose supply. The cotton import volume is low, and spinning mills are looking forward to import quotas. The cotton commercial inventory in China is being destocked at a fast speed [22][24][40].

Report Summary 1. Investment Rating The report does not mention the industry investment rating. 2. Core View The short - term increase in cotton prices is significant, and it is advisable to wait for an adjustment. The market is currently in a state where supply and demand are both increasing, and news stimuli are needed to break the balance [3][4]. 3. Summary by Relevant Contents Market Performance - Last week, both domestic and international cotton prices fluctuated upwards, basically recovering the losses at the end of July. ICE cotton rebounded significantly after the USDA's August supply - demand report lowered the US cotton production and inventory. Zhengzhou cotton also rose after the 90 - day extension of the US - China tariff exemption period [4][5][9]. - The 1 - 5 spread of cotton futures first consolidated and then tended to strengthen. The futures price rebounded rapidly, and the basis weakened significantly [11][12][15]. Supply and Demand Analysis - In the August supply - demand report, the USDA predicted a global cotton supply - demand imbalance. The US cotton production was significantly lowered, while China's cotton production was raised as expected. The consumption in China and India showed an increase - decrease pattern, and the global cotton supply - demand was on the verge of balance [19]. - As of August 7, 2025, the national new cotton picking, processing, and sales rates were at high levels. The sales rate was 97.7%, an increase of 6.7 percentage points year - on - year and 8.4 percentage points compared to the average of the past four years [21][22]. - In June 2025, China's cotton import volume was 27,820 tons, a month - on - month decrease of 22.42% and a year - on - year decrease of 82.09%. The "rush to export" behavior in the textile and garment industry from April to June overdrew some orders, reducing the cotton import demand [23][24]. - In June 2025, China's cotton yarn import volume was about 109,000 tons. Although it ended the three - month consecutive month - on - month decline, the annual import demand was still in a contraction channel, with the cumulative import volume from January to June decreasing by 13.61% year - on - year [26][27]. Industry Operation - In July 2025, the cloth production was 2.7 billion meters, a year - on - year increase of 6.8% and a month - on - month decrease of 3.5%. It is expected that the production from July to August will remain weak, and the month - on - month decline may expand to 3% - 5% [32]. - In June 2025, textile exports were 12.048 billion US dollars, a year - on - year decrease of 1.6%. Clothing exports were 15.267 billion US dollars, a year - on - year increase of 1.1%. The retail sales of domestic clothing in June increased by 2.8% year - on - year [34][35][39]. Inventory and Operation of Enterprises - In July 2025, China's cotton commercial inventory was at a four - year low, while the industrial inventory was increasing. The commercial inventory was 2.1898 million tons, a year - on - year decrease of 588,400 tons, and the industrial inventory was 898,400 tons, a year - on - year increase of 91,400 tons [41][42]. - Spinning mills mainly digested cotton inventory, and the cotton yarn inventory decreased for two consecutive weeks. The opening rate of Chinese cotton spinning mills began to pick up, while the opening rates of Vietnamese and Indian spinning mills were at low levels [44][46][47]. - The spinning profit of domestic spinning mills was stable. The cotton yarn inventory of grey fabric mills continued to replenish, and the inventory of imported yarn at ports rebounded [56][57][59]. Fund Position By August 5, the fund's cotton position was a net short position of 55,882 lots, indicating that the fund continued to increase short positions before the USDA report [64].

Report Industry Investment Rating - There is no information about the report industry investment rating in the provided content. Core Viewpoints - The 2025/26 global cotton production is revised down by 391,000 tons month-on-month, with a significant reduction in US cotton production exceeding market expectations, leading to a sharp rise in US cotton prices [1]. - The 2025/26 global cotton consumption is revised down by 30,000 tons, and the impact of China-US relations on the demand for US cotton in the new season is significant [1]. - The 2025/26 global cotton imports and exports are both weak, with imports decreasing by 239,000 tons and exports by 240,000 tons [2]. - The 2025/26 global ending inventory is revised down by 742,000 tons, with a large - scale reduction, and continued attention should be paid to the weather in the Northern Hemisphere's major producing countries and the progress of China - US trade relations [2]. Summary by Relevant Catalogs Production - US cotton: The planted area is revised down from 10.12 million acres in July to 9.28 million acres, the harvested area from 8.66 million acres to 7.36 million acres, and the yield per acre is raised from 809 pounds to 862 pounds. The final production is revised down by 302,000 tons to 2.877 million tons [1]. - Chinese cotton: The production is revised up by 108,000 tons to 6.858 million tons [1]. - Global cotton: The production is revised down by 391,000 tons month - on - month [1]. Consumption - Chinese consumption: It is revised up by 218,000 tons [1]. - Indian consumption: It is revised down by 109,000 tons [1]. - Bangladeshi consumption: It is revised down by 65,000 tons [1]. - Turkish consumption: It is revised down by 43,000 tons [1]. - Global consumption: It is revised down by 30,000 tons [1]. Import - Bangladeshi imports: They are revised down by 65,000 tons [2]. - Chinese imports: They are revised down by 109,000 tons to 1.154 million tons [2]. - Turkish imports: They are revised down by 43,000 tons [2]. - Indian imports: They are revised down by 22,000 tons [2]. - Global imports: They are revised down by 239,000 tons [2]. Export - US exports: They are revised down by 109,000 tons [2]. - Malian exports: They are revised down by 22,000 tons [2]. - Global exports: They are revised down by 240,000 tons [2]. Ending Inventory - Chinese ending inventory: It is revised down by 446,000 tons [2]. - Indian ending inventory: It is revised up by 108,000 tons [2]. - Brazilian ending inventory: It is revised down by 110,000 tons [2]. - US ending inventory: It is revised down by 218,000 tons [2]. - Global ending inventory: It is revised down by 742,000 tons [2].

Report Industry Investment Rating No relevant content provided. Core Viewpoints - The USDA's August 2025/26 cotton monthly report shows significant adjustments in global cotton supply and demand data, with a sharp decline in US cotton production exceeding market expectations, leading to a substantial increase in US cotton prices. Continued attention should be paid to the weather conditions in major northern hemisphere producing countries and the progress of China-US trade relations [1][2]. Summary by Content Production - In the 2025/26 season, global cotton production decreased by 391,000 tons month-on-month. US cotton production decreased significantly, with the planting area reduced from 10.12 million acres in July to 9.28 million acres, the harvested area reduced from 8.66 million acres to 7.36 million acres, and the yield per acre increased from 809 pounds to 862 pounds, resulting in a monthly decrease of 302,000 tons to 2.877 million tons. China's cotton production increased by 108,000 tons to 6.858 million tons [1]. Consumption - In the 2025/26 season, global cotton consumption decreased by 30,000 tons month-on-month. China's consumption increased by 218,000 tons, while India's consumption decreased by 109,000 tons, Bangladesh's decreased by 65,000 tons, and Turkey's decreased by 43,000 tons [1]. Import and Export - In the 2025/26 season, global cotton imports decreased by 239,000 tons month-on-month, with Bangladesh, China, Turkey, and India all experiencing declines. Global exports decreased by 240,000 tons, with the US and Mali seeing significant drops, indicating weak global import and export demand [2]. Ending Inventory - In the 2025/26 season, the global ending inventory decreased by 742,000 tons month-on-month. China's ending inventory decreased by 446,000 tons, while India's increased by 108,000 tons, Brazil's decreased by 110,000 tons, and the US's decreased by 218,000 tons [2].