Report Summary 1. Report Industry Investment Rating No information provided regarding the report industry investment rating. 2. Core Viewpoints - This week, cotton prices rose first and then fell. After a continuous rebound, the correction was relatively rapid. The main cotton contract 05 faces significant pressure around 15,000. After a rapid correction, prices are expected to fluctuate around 14,500 [6]. - There are both positive and negative factors in the cotton market. Positive factors include the expected reduction of over 10% in the cotton planting area in Xinjiang in 2026, pre - Chinese New Year inventory replenishment by downstream enterprises, and a 10% reduction in export tariffs to the US compared to the previous period. Negative factors include a decline in overall foreign trade orders, increased inventory, a large amount of new cotton on the market, and the current traditional off - season for consumption [7][8]. 3. Summary by Directory 3.1 Previous Day Review - This week, cotton prices showed a pattern of rising first and then falling. After continuous rebounds, the correction was relatively fast. The expected reduction in the cotton planting area in Xinjiang in 2026 may exceed 10%. According to the USDA December report, the production in the 2025/2026 season is 26.081 million tons, consumption is 25.823 million tons, and the ending inventory is 16.541 million tons. In November, textile and clothing exports were $23.869 billion, a year - on - year decrease of 5.12%. In November, China imported 120,000 tons of cotton, a year - on - year increase of 9.4%, and 150,000 tons of cotton yarn, a year - on - year increase of 25%. According to the Ministry of Agriculture's December 2025/2026 forecast, production is 6.7 million tons, imports are 1.4 million tons, consumption is 7.6 million tons, and the ending inventory is 8.35 million tons [6]. 3.2 Daily Tips - Positive factors: Expected reduction of over 10% in the cotton planting area in Xinjiang in 2026, pre - Chinese New Year inventory replenishment by downstream enterprises, and a 10% reduction in export tariffs to the US compared to the previous period [7]. - Negative factors: Decline in overall foreign trade orders, increased inventory, a large amount of new cotton on the market, and the current traditional off - season for consumption [8]. 3.3 Today's Focus No information provided. 3.4 Fundamental Data - **USDA Global Cotton Supply - Demand Forecast (December)**: In the 2025/2026 season, global production is 26.081 million tons, consumption is 25.873 million tons, and the ending inventory is 16.541 million tons. There are differences in production, consumption, import, and export data among different countries. For example, the US production is expected to increase by 38.1% year - on - year, while Australia's production is expected to decrease by 23.9% year - on - year [11][12]. - **ICAC Global Cotton Supply - Demand Forecast (November 2025)**: The planting area is 30.41385 million hectares, the yield per unit area is 835.13 kg/ha, production is 25.39956 million tons, consumption is 25.00778 million tons, and the ending inventory is 16.22785 million tons [14]. - **Ministry of Agriculture's Data**: In the 2025/2026 season, production is 7.278 million tons, imports are 1.1 million tons, consumption is 8.1 million tons, and the ending inventory is 10.116 million tons [16]. 3.5 Position Data No information provided.

1. Report's Investment Rating for the Industry - No relevant information provided. 2. Core Views of the Report - The international cotton market has limited driving forces. The Fed is likely to keep rates unchanged in January. The global cotton supply - demand gap is small, and the US cotton market is expected to fluctuate. [10] - The domestic cotton market has strong expectations. The reduction of cotton planting area in Xinjiang in 2026 is certain, leading to a strong expectation of lower production. The demand side is resilient, and there is positive sentiment at the macro - level. The Zhengzhou cotton futures price has strong support below, and there may be an upward space in the medium - to - long - term. [11] 3. Summary by Relevant Catalogs 3.1 Supply - New - year cotton planting area is expected to decline, with strong sentiment. In Xinjiang, measures to reduce cotton planting area are being implemented. [6] - Pima cotton processing volume increased by about 1.1 million tons year - on - year. As of December 25, 2025, the processing volume was 6.697 million tons, with a month - on - month increase of 0.211 million tons and a year - on - year increase of 1.09 million tons. [39][41] - National cotton inspection volume increased. As of December 30, 2025, Xinjiang's inspection volume was 6.1358 million tons, and the national volume was 6.3243 million tons. [43] - Pima cotton sales rate and sales volume are much higher than the same period last year. As of December 25, 2025, the sales volume was 3.731 million tons, and the sales rate was 50.7%. [46][47] 3.2 Demand - US clothing retail remains strong. In October, the monthly retail sales of US clothing and clothing accessories were 27.128 billion US dollars, with a month - on - month increase of 0.9% and a year - on - year increase of 5.7%. [50][52] - The operating rates of textile enterprises in Vietnam, India, and Pakistan decreased or remained flat. As of December 26, Vietnam's operating rate was 61.9%, India's was 66.9%, and Pakistan's was 65.5%. [54] - In November in China, the retail sales of clothing, footwear, knitwear, and textiles were 154.2 billion yuan, a year - on - year increase of 3.5%. The cumulative retail sales from January to November were 1.3597 trillion yuan, a year - on - year increase of 3.5%. [7][57] - The comprehensive yarn load decreased week - on - week. As of the week of December 26, the comprehensive yarn load was 50.1%, and the pure - cotton yarn mill load was 46.86%. [7][58] - The opening load of the grey fabric end decreased slightly, with a smaller decline than the yarn end. As of the week of December 26, the comprehensive short - fiber fabric load was 51.26%, and the pure - cotton grey fabric load was 48.66%. [7][59] 3.3 Import and Export - In the 2025/26 season, the US cotton export contract volume is still low year - on - year. As of December 11, 2025, the total US cotton export contract volume was 1.445 million tons, a year - on - year decrease of 0.243 million tons. [8][60] - In November, the export value of China's textile yarns, fabrics, and related products was 12.276 billion US dollars, a year - on - year increase of 0.98%. The cumulative export from January to November was 130.01 billion US dollars, a year - on - year increase of 0.9%. [8][64] - In November, the export value of China's clothing and clothing accessories was 11.594 billion US dollars, a year - on - year decrease of 10.93%. The cumulative export from January to November was 137.79 billion US dollars, a year - on - year decrease of 4.4%. [8][66] - In November, China imported 120,000 tons of cotton, a month - on - month increase of 30,000 tons and a year - on - year increase of 10,000 tons. [8][70] - In November, China imported 150,000 tons of cotton yarn, a slight month - on - month increase. [75] - The import cotton price index strengthened month - on - month. As of December 31, 2025, the price index of medium - grade imported cotton with a 1% quota was 12,922 yuan/ton, a week - on - week increase of 59 yuan. [79][81] 3.4 Inventory - US clothing retail inventory increased month - on - month, while wholesaler inventory decreased month - on - month. In September 2025, the retail inventory was 58.488 billion US dollars, and the wholesaler inventory was 28.229 billion US dollars. [82][84] - Yarn comprehensive inventory decreased, and grey fabric inventory accumulated. As of the week of December 26, the yarn comprehensive inventory was 27.66 days, and the short - fiber fabric comprehensive inventory was 31.92 days. [85][86] - Spinning enterprises' raw material inventory decreased slightly, and finished - product inventory decreased significantly. As of the week of December 26, the spinning enterprises' cotton inventory was 31.94 days, and the cotton yarn inventory was 27.66 days. [88] - Weaving factories' raw material and finished - product inventory increased month - on - month. As of the week of December 26, the weaving factories' cotton yarn inventory was 6.92 days, and the pure - cotton grey fabric inventory was 35.06 days. [89] - China's domestic cotton commercial inventory increased by 0.66 million tons month - on - month, basically the same year - on - year. As of December 15, 2025, the commercial inventory was 5.349 million tons. [90][92] - The number of cotton warehouse receipts is higher than the same period last year. As of December 30, 2025, the total number of warehouse receipts and effective forecasts was 9,185. [97][99] 3.5 Price - The spot price of cotton moved up. As of December 30, 2025, the national average price was 15,543 yuan/ton, a month - on - month increase of 4.34%. [18][22] - The 1 - 5 spread of cotton strengthened. As of December 31, 2025, the 1 - 5 spread was 70 yuan/ton, a month - on - month increase of 45 yuan. [27][29] - The price difference between domestic and foreign cotton under a 1% tariff fluctuated and strengthened. As of December 30, 2025, the price difference was 2,621 yuan/ton, a month - on - month increase of 605 yuan. [30][31] - The increase in the cotton yarn futures price was lower than that of the cotton futures price. As of December 31, 2025, the closing price of cotton yarn futures was 20,585 yuan/ton, a month - on - month increase of 2.69%. [33][34] - The cotton yarn basis gradually converged. As of December 31, 2025, the basis was 555 yuan/ton, a month - on - month decrease of 210 yuan. [35][36] 3.6 Option - The historical volatility of cotton options increased significantly. [100]

1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints of the Report - In 2026, the core logic of the Zhengzhou cotton market will revolve around the adjustment of Xinjiang's direct subsidy policy and the marginal repair of demand, and the market is expected to show characteristics of "strengthened bottom support and an upward shift in the range - bound oscillation" [4]. - The global cotton supply is unlikely to increase significantly, and the slow reduction of the previously excessive inventory will gradually push the global supply - demand pattern from a loose to a tight balance [115]. - The improvement in demand is more likely to be "gradual" rather than a rapid rebound. The domestic textile industry has resilience, and overseas restocking demand has the potential to be released [116]. - Throughout 2026, the cotton price will be under pressure in the short - term at the beginning of the year, and the price center may gradually rise after the second quarter. In the fourth quarter, if the tight - balance pattern of supply and demand is consolidated, the cotton price is expected to further repair its valuation [117]. 3. Summary by Relevant Catalog 3.1 Market Review 3.1.1 Futures Market Review - In the Zhengzhou cotton market in 2025, the cotton price showed a step - by - step downward trend in the first half of the year, with fluctuations due to factors such as policy expectations, trade frictions, and supply - demand relationships. In the second half of the year, it was affected by factors such as the expectation of supply shortage and the release of downstream demand, showing a volatile upward trend [11]. - In the US cotton market in 2025, due to factors such as the high inventory of old crops in major producing areas, the repeated Sino - US tariff policies, and the lack of Chinese buying, the price remained in a low - level oscillation range of 60 - 70 cents per pound in the first half of the year, and the oscillation center dropped to 65 cents per pound in the second half of the year [12]. 3.2 Overseas Cotton Market Supply - Demand Analysis 3.2.1 Global Supply - Demand Balance Overview - According to the December USDA report, the marginal adjustment of the global cotton market is relatively small, with a neutral - bearish impact on the global market. The global cotton output is slightly reduced, consumption is slightly decreased, trade volume is slightly adjusted downward, and the ending inventory and inventory - to - consumption ratio are slightly increased [13][14][16]. 3.2.2 US Market Supply - Demand Situation - In the 2025/2026 season, the US cotton production is slightly reduced. Although the planting area decreased due to the low cotton - grain price ratio, the favorable weather during the planting season led to a smaller - than - expected decline in the harvested area and an increase in yield per unit, offsetting some of the early - stage production reduction expectations [23]. - The US cotton export contract performance is poor, but there is a chance of recovery in 2026. The reduction of Sino - US tariffs and the increase in global textile demand will provide opportunities for the recovery of US cotton exports [30]. - The US cotton valuation is at a low level, and the relatively high inventory - to - consumption ratio restricts the upward space of the price. In the short - to - medium - term, the US cotton price may still face upward pressure [34]. 3.2.3 Brazilian Market Supply - Demand Situation - In the 2024/2025 season, the Brazilian cotton output increased, and the export scale in the 2025/2026 season is expected to reach a new high. However, due to the low "grain - cotton price ratio" and the expected deterioration of weather conditions, the cotton production in 2026 is expected to decline [39][40]. 3.2.4 Indian Market Supply - Demand Situation - In the 2024/2025 season, the Indian cotton market showed the characteristics of "decreased production and increased imports", and the supply pattern was dominated by import supplementation. In the 2025/2026 season, the production is slightly reduced, and the ending inventory pressure is relatively large [44]. 3.3 Domestic Cotton Market Supply - Demand Situation 3.3.1 China's Cotton Supply - Demand Balance Sheet - Under the USDA's caliber, the estimated cotton output in the 2025/2026 season is 729.3 million tons, the consumption is 838.16 million tons, and the import is 117.56 million tons. The inventory - to - consumption ratio is at a relatively neutral level in the past three years [46]. - Under the BCO's caliber, the estimated output in the 2025/2026 season is 768 million tons, the consumption is 858 million tons, and the import is 120 million tons. The short - to - medium - term inventory pressure may be higher than that in the 2024/2025 season, but it is still relatively loose [46]. 3.3.2 Cost - The cost of lint cotton in the new year is stable, and the processing and sales of new cotton are relatively fast. The cost of lint cotton is roughly locked in the range of 14,374 - 15,246 yuan per ton, and the hedging pressure on the futures market has been greatly relieved [53]. 3.3.3 Output - The cotton output in the 2025/2026 season reaches a peak in the past ten years, but there are still narrow fluctuations. The output in Xinjiang is expected to increase by 7% - 10% year - on - year. The new direct subsidy policy in Xinjiang may lead to a reduction in production, and the weather conditions during the planting period in 2026 are expected to be worse than those in the 2024 - 2025 period [56][59]. 3.3.4 Import - In the 2024/2025 season, China's cotton imports are at a low level. In the 2025/2026 season, the expected upper limit of imports is limited, with an estimated import volume of about 110 - 120 million tons. The reduction of Sino - US tariffs is beneficial to US cotton exports to China, but the short - to - medium - term import pressure of US cotton may increase [65][66]. 3.3.5 Inventory - Affected by the high - yield in the 2025/2026 season, China's commercial cotton inventory is at a high level in recent years. However, due to the strong downstream consumption resilience, the inventory reduction is better than expected. The inventory of some sample enterprises' pure - cotton yarn is relatively high, while the overall inventory level of textile enterprises in the grey fabric and yarn links is relatively low [74][79]. 3.3.6 Demand - **Load and Profit**: In 2025, the overall starting rate of spinning mills is at a relatively low level, but the resilience after the "Golden September and Silver October" is better than expected. The immediate profit of textile enterprises shows a trend of "decline - repair - re - pressure". The continuous expansion of Xinjiang's cotton - spinning capacity is expected to support the cotton demand in the 2025/2026 season to remain flat or increase slightly [83][85][86]. - **Retail and Consumption**: From January to November 2025, the cumulative monthly retail sales of clothing by Chinese enterprises above the designated size increased moderately year - on - year. In the long - term, due to factors such as population structure changes, domestic terminal cotton - related consumption is still mainly based on rigid demand [90][94]. - **Export**: In November 2025, the decline in textile and clothing exports narrowed, and textile exports resumed growth. The export showed a pattern of "trading volume with price", and the export price of cotton yarn and clothing is at a low level in recent years. The optimization of Sino - US trade relations and the low inventory in the US market provide opportunities for the release of overseas restocking demand [102][106][114]. 3.4 Market Outlook - In 2026, the Zhengzhou cotton price is expected to strengthen its bottom support and gradually rise in the range - bound oscillation. The supply side will gradually shift from a loose to a tight balance, and the demand side will gradually recover. The cotton price will be under pressure in the short - term at the beginning of the year and may rise gradually after the second quarter. In the fourth quarter, if the tight - balance pattern of supply and demand is consolidated, the cotton price is expected to further repair its valuation [115][116][117].

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - Cotton outlook: The pressure of new cotton concentrated listing has subsided, and spot sales are relatively smooth. The market focuses on the reduction of next year's planting area and the expectation of stable consumption. With a stable spot market, market purchasing willingness is strong, and prices remain strong [69]. - Yarn outlook: The yarn market mainly follows cotton prices. However, due to intense competition in the industrial chain and the decline in exports, it is expected that there will be greater pressure later. As cotton prices strengthen, yarn prices will also remain strong, but the pattern of compressed yarn profits is difficult to change [69]. 3. Summary According to the Table of Contents 3.1. Trend Review: Zhengzhou Cotton Fluctuated Strongly in December - In December, Zhengzhou cotton fluctuated strongly. The core reasons were the smooth spot sales this year, with the sales progress significantly higher than in previous years, and the large expectation of a reduction in Xinjiang's planting area next year. Yarn mainly followed the cotton trend, but spinning profits were compressed. The continued large - scale expansion of Xinjiang's production capacity exerted great pressure on the inland [8]. 3.2. Supply - Side Analysis: New - Season Global Supply - Demand Balance 3.2.1. Global Supply - Demand Balance Sheet - According to the USDA's December global cotton supply - demand forecast report, the 2024/25 season was basically stable; the adjustment in the 2025/26 season was also limited, with production, consumption, and imports and exports all reduced by 60,000 tons, and the final ending inventory increased by 10,000 tons. In the 2025/26 season, harvesting in most production areas was basically completed, and some started planting for the 2026/27 season. Therefore, the production adjustment shrank significantly, and consumption and import - export trade also declined slightly [14]. 3.2.2. US Cotton - In 2025/26, the US planting area was 56.427 million mu, and the harvested area was 44.729 million mu, with the abandonment rate remaining unchanged at 20.7%. The expected yield per unit was 69.4 kg/mu, a month - on - month increase of 1.1%; the expected production was adjusted up to 3.106 million tons, a month - on - month increase of 33,000 tons, an increase of 1.1%. The expected consumption was 348,000 tons, a month - on - month decrease of 22,000 tons, a decrease of 5.9%; the expected export volume was flat month - on - month. Based on this, the ending inventory increased by 44,000 tons to 980,000 tons [15]. 3.2.3. US Cotton Contracted Exports and Shipments - As of December 11, 2025, the US had cumulatively net - contracted to export 1.445 million tons of cotton for the 2025/26 season, reaching 54.39% of the annual expected export volume, and had cumulatively shipped 605,000 tons of cotton, with a shipment rate of 41.88%. Among them, the contracted volume of upland cotton was 1.402 million tons, and 577,000 tons were shipped, with a shipment rate of 41.16%. The contracted volume of Pima cotton was 42,000 tons, and 28,000 tons were shipped, with a shipment rate of 65.85%. China had cumulatively contracted to import 64,000 tons of US cotton for the 2025/26 season, accounting for 4.42% of the contracted US cotton volume; and had cumulatively shipped 23,000 tons of US cotton, accounting for 3.77% of the total US cotton shipments and 35.68% of China's contracted volume [21]. 3.2.4. India - According to the CAI's November supply - demand balance sheet, in the 2025/26 season, the expected production was 5.262 million tons, a month - on - month increase of 77,000 tons; the expected import was 850,000 tons, a month - on - month increase of 85,000 tons. On the demand side, the expected consumption was 5.015 million tons, a month - on - month decrease of 85,000 tons; the expected export was 306,000 tons, a month - on - month increase of 17,000 tons. Based on this, India's ending cotton inventory increased to 1.821 million tons, a month - on - month increase of 230,000 tons [24]. 3.2.5. Brazil - In 2025, Brazil's cotton planting area was expected to be adjusted up to 2.17 million hectares (32.55 million mu), a month - on - month increase of 0.9% and a year - on - year increase of 9.0%; the expected yield per unit was adjusted up to 130.5 kg/mu, a month - on - month increase of 2.2% and a year - on - year increase of 2.8%; so the expected total production was adjusted up to 4.25 million tons, a year - on - year increase of 14.9%. In 2026, Brazil's cotton planting area was expected to be 2.05 million hectares (30.75 million mu), a year - on - year decrease of 5.5%; the expected yield per unit was 124.4 kg/mu, a year - on - year decrease of 4.7%; so the expected total production was 3.83 million tons, a year - on - year decrease of 9.9%, at the second - highest level in the past five years [25]. 3.2.6. China - In the 2025/26 season, in terms of total supply, the beginning inventory remained stable at 6.16 million tons. In terms of production, although the yield per unit in southern Xinjiang decreased locally, the total production still increased due to the increase in area, and the national total production was adjusted up by 260,000 tons to 7.68 million tons. In terms of imports, it was expected to remain unchanged at 1.2 million tons. According to the above situation, the annual total supply was adjusted up by 260,000 tons to 15.04 million tons. In terms of total demand, new orders from textile enterprises decreased slightly in November, but the market was "not in a slack season", the overall sales - to - production ratio and finished - product inventory remained stable, the operating rate remained at a relatively high level and was resilient, the cumulative cotton consumption in the new season increased year - on - year, and the annual textile cotton consumption was expected to be adjusted up by 130,000 tons to 8.21 million tons. The total demand increased by 130,000 tons to 8.58 million tons [30]. 3.2.7. Industrial and Commercial Inventories - At the end of November, the cotton industrial inventory of cotton textile enterprises showed a steady - to - increasing trend. As of the end of November, the in - stock cotton industrial inventory of textile enterprises was 939,600 tons, an increase of 51,400 tons from the end of the previous month. As of the end of November 2025, the national cotton commercial inventory was 4.6836 million tons, an increase of 1.753 million tons from the previous month, an increase of 59.82%, 10,000 tons higher than the same period last year, an increase of 0.21%. As of December 15, the total industrial and commercial inventory was 6.3329 million tons, an increase of 44,500 tons year - on - year and an increase of 709,700 tons month - on - month [33]. 3.2.8. Imports of Cotton and Yarn in November - In November 2025, China's cotton import volume was 120,000 tons, a month - on - month increase of 30,000 tons (from 90,000 tons), an increase of 34.4%; a year - on - year increase of 10,000 tons (from 110,000 tons), an increase of 9.4%. From January to November 2025, China's cumulative cotton import volume was 890,000 tons, a year - on - year decrease of 64.0%. From September to November 2025 (2025/26 season), the cumulative cotton import volume was 310,000 tons, a year - on - year decrease of 8.8%. In November 2025, China's yarn import volume was 150,000 tons, a year - on - year increase of about 30,000 tons, an increase of about 25%, and a month - on - month increase of about 10,000 tons, an increase of about 7.14%. From January to November 2025, the cumulative yarn import volume was 1.33 million tons, a year - on - year decrease of 3% [36]. 3.2.9. Supply - Side Summary - According to the latest USDA report, the global supply - demand remained in a balanced state, with overall production and consumption at an absolute high level and moderate inventory. The contradiction was not prominent. Domestically, although production increased, due to the tight industrial and commercial carry - over inventory and smooth sales, the overall inventory did not increase significantly year - on - year. Globally, attention should be paid to the reduction of planting areas in the US, Brazil, and China next year. Domestically, attention should be paid to the situation of structural supply tightness after the growth of Xinjiang's yarn production capacity and the adjustment of Xinjiang's cotton planting policy next year [38]. 3.3. Demand - Side Analysis: Strong Resilience in Downstream Demand 3.3.1. Strong Domestic Demand - In November 2025, the total retail sales of consumer goods were 4.3898 trillion yuan, a year - on - year increase of 1.3% and a month - on - month decrease of 5.17%. From January to November 2025, the total retail sales of consumer goods were 45.6067 trillion yuan, a year - on - year increase of 4.0%. In November, the retail sales of clothing, footwear, hats, and knitted textiles were 154.2 billion yuan, a year - on - year increase of 3.5% and a month - on - month increase of 4.83%. From January to November, the cumulative retail sales were 1.3597 trillion yuan, a year - on - year increase of 3.5% [43]. 3.3.2. Weakening External Demand Exports - In November 2025, China's textile and clothing exports were 23.869 billion US dollars, a year - on - year decrease of 5.12% and a month - on - month increase of 7.22%. Among them, textile exports were 12.276 billion US dollars, a year - on - year increase of 1.03% and a month - on - month increase of 9.05%; clothing exports were 11.594 billion US dollars, a year - on - year decrease of 10.86% and a month - on - month increase of 5.36%. From January to November 2025, China's textile and clothing exports were 267.795 billion US dollars, a year - on - year decrease of 1.91%. Among them, textile exports were 130.009 billion US dollars, a year - on - year increase of 1.03%; clothing exports were 137.787 billion US dollars, a year - on - year decrease of 4.4% [46]. 3.3.3. Textile Industry Inventory - In October, the inventory of the textile industry was 4.064 trillion yuan, a month - on - month increase of 0.8 billion yuan and a year - on - year increase of 3.8 billion yuan; the finished - product inventory of the textile industry was 2.18 trillion yuan, a month - on - month increase of 600 million yuan and a year - on - year increase of 1.6 billion yuan. The inventory of textile and clothing was 1.878 trillion yuan, a month - on - month decrease of 2.4 billion yuan and a year - on - year decrease of 9 billion yuan; the finished - product inventory of textile and clothing was 1.008 trillion yuan, a month - on - month decrease of 2.1 billion yuan and a year - on - year decrease of 4.7 billion yuan [48]. 3.3.4. US Clothing and Apparel Retail Sales in September 2025 - In September 2025, the retail sales of clothing and apparel accessories in the US (seasonally adjusted) were 27.043 billion US dollars, a year - on - year increase of 6.65% (the same period last year was downward - adjusted to 25.356 billion US dollars) and a month - on - month decrease of 0.72% (the previous month was upward - adjusted to 27.24 billion US dollars). In August 2025, the inventory of clothing and apparel accessory retailers in the US (seasonally adjusted) was 58.114 billion US dollars, a year - on - year decrease of 0.35% (the same period last year was downward - adjusted to 58.321 billion US dollars) and a month - on - month decrease of 0.08% (the previous month was downward - adjusted to 58.161 billion US dollars). In August 2025, the inventory - to - sales ratio of clothing and apparel accessory retailers in the US (seasonally adjusted) was 2.13, a year - on - year decrease of 0.21 and a month - on - month decrease of 0.03 [55]. 3.3.5. Load Changes - As of November 21, the load index of pure - cotton yarn mills was 64.3, a decrease of 0.14 from the previous week; the load of rayon yarn was 48.3, the same as the previous week; the load of pure - polyester yarn was 59, the same as the previous week. The load of yarn and grey cloth showed signs of weakening [57]. 3.3.6. Industrial Chain Inventory - In terms of inventory, the cotton inventory of textile enterprises was 28.9 days, an increase of 0.9 days from the previous week; the yarn inventory of textile enterprises was 28.26 days, an increase of 0.24 days from the previous week; the inventory of all - cotton grey cloth was 31.48 days, an increase of 0.3 days from the previous week. As it entered the consumption slack season, inventory began to accumulate [61]. 3.3.7. Demand - Side Summary - In terms of downstream demand, domestic demand was very stable and resilient. In terms of external demand exports, it began to weaken in the second half of the year. However, judging from the US consumption data, the recent data was acceptable, but there was a long delay, and further observation was needed. In the past two years, although cotton prices were sluggish, global consumption increased steadily, offsetting most of the production growth [66].

Report Industry Investment Rating No relevant information provided. Core Viewpoints - The supply - demand outlook for domestic cotton in the new year is tight. With the high - yield of Xinjiang cotton this year, the overall supply increase is narrowing due to last year's low inventory and expected low imports. Meanwhile, consumption is supported by expanding spinning capacity, high - load operation of Xinjiang yarn mills, and improved export prospects. Also, expectations of a reduction in next year's cotton planting area in Xinjiang are strengthening, leading to a continuous and accelerating upward shift in cotton prices [1]. - In the short term, there is a risk of cotton price correction. The slowdown in grey fabric sales is affecting the yarn market, squeezing spinning profits and slightly reducing the operating rate. The increasing price difference between domestic and foreign cotton may boost demand for imported yarn, and the uncertainty of the new - season target price subsidy policy also adds to the risk. However, the overall downstream inventory pressure is not large, so the correction range may be limited [7]. - In the long term, the supply - demand of domestic cotton in the new year may remain tight. The rigid consumption of cotton has increased due to the expansion of downstream textile production capacity. Although domestic cotton production has increased significantly, imports are still needed to fill the gap. The probability of further increasing cotton import quotas is low [15]. Summary by Relevant Catalogs Chapter 1: Core Contradictions and Strategy Recommendations 1.1 Core Contradictions - As of December 25, 2025, the cumulative national new - year cotton notarized inspection volume reached 6.0641 million tons, and the average daily notarized inspection volume has dropped to about 55,000 tons. Domestic cotton commercial inventory has significantly increased, but the overall supply increase in the new year is narrowing. The spot price is firm [1]. - Downstream, the expansion of domestic spinning capacity and high - load operation of Xinjiang yarn mills have increased the rigid consumption of cotton. Domestic demand is growing moderately with policy support, and the reduction of Sino - US tariffs is conducive to the recovery of textile and clothing exports [1]. - This year is the last year of the three - year target price subsidy policy. Market expectations of policy adjustment next year are strong due to food supply policies and water resource issues in Xinjiang. A meeting was held to formulate a plan to reduce cotton planting area, further strengthening the expectation of a reduction in Xinjiang cotton area next year [1]. 1.2 Trading - Type Strategy Recommendations - Price range: CF2605 is expected to trade between 13,700 - 14,800. - Strategy: Long - term long positions can be laid out for CF2605 on dips [17]. 1.3 Industrial Customer Operation Recommendations - Price range forecast for cotton in the near future: 13,700 - 14,800, with a current 20 - day rolling volatility of 0.0817 and a 3 - year historical percentile of 0.1968 [17]. - Inventory management: For enterprises with high inventory worried about price drops, they can short Zhengzhou cotton futures (CF2605) to lock in profits, with a hedging ratio of 50% at 14,700 - 14,800. They can also sell call options (CF2605C14800) to collect premiums, with a hedging ratio of 50% at 350 - 400 [17]. - Procurement management: For enterprises with low procurement inventory, they can buy Zhengzhou cotton futures (CF2605) to lock in procurement costs, with a hedging ratio of 75% at 13,700 - 13,800. They can also sell put options (CF2605P13800) to collect premiums, with a hedging ratio of 75% at 300 - 350 [17]. 1.4 Basic Data Overview - Futures data: Zhengzhou cotton 01 closed at 14,565, up 520 (3.7%); Zhengzhou cotton 05 closed at 14,535, up 520 (3.71%); Zhengzhou cotton 09 closed at 14,720, up 545 (3.84%) [18]. - Spot data: CC Index 3128B was at 15,317, up 172 (1.14%); CC Index 2227B was at 13,583, up 275 (2.07%); CC Index 2129B was at 15,559, up 170 (1.1%) [18]. - Spread data: CF1 - 5 spread was 30 (unchanged); CF5 - 9 spread was - 185, down 25; CF9 - 1 spread was 155, up 25 [18]. - Import price: FC Index M was at 12,898, up 129 (1.01%); FCY Index C32s was at 21,173, up 21 (0.1%) [18]. - Yarn data: Futures price was 20,585, up 535 (2.67%); spot price was 21,140, up 210 (1%) [18]. Chapter 2: Core Contradictions and Strategy Recommendations 2.1 This Week's Important Information - **Positive information**: As of December 18, the national new - cotton picking progress was 99.9% (unchanged year - on - year and compared with the four - year average), the delivery rate was 99.3% (up 0.6 percentage points year - on - year and 1.2 percentage points compared with the four - year average), the processing rate was 88.0% (up 2.0 percentage points year - on - year and 7.9 percentage points compared with the four - year average), and the sales rate was 47.3% (up 25.0 percentage points year - on - year and 28.5 percentage points compared with the four - year average). In November, the retail sales of clothing, footwear, and textiles in China were 154.2 billion yuan, up 4.84% month - on - month and 4.19% year - on - year. In November 2025, the export volume of cotton products was 646,400 tons, up 6.32% month - on - month and 9.84% year - on - year; the export value was $5.274 billion, up 12.74% month - on - month and down 10.67% year - on - year; the export unit price was $8.16/kg, up 6.11% month - on - month and down 18.64% year - on - year [19]. - **Negative information**: In November 2025, China's textile and clothing exports were $23.869 billion, down 5.12% year - on - year and up 7.22% month - on - month. Among them, textile exports were $12.276 billion, up 1.03% year - on - year and 9.05% month - on - month; clothing exports were $11.594 billion, down 10.86% year - on - year and up 5.36% month - on - month. As of December 11, 2025, the cumulative net signed export volume of US cotton for the 25/26 season was 1.445 million tons, down 14.40% year - on - year, reaching 54.39% of the annual expected export volume, and the cumulative shipment was 605,000 tons, with a shipment rate of 41.88% [21]. 2.2 Next Week's Important Events to Watch Keep an eye on the subsequent export situation of US cotton as the current US cotton industry data is lagging [22]. Chapter 3: Disk Interpretation 3.1 Price - Volume and Fund Interpretation - **Unilateral trend and fund movement**: Zhengzhou cotton continued to rise this week with an enlarged increase. Funds actively entered the market, and market activity increased. The position of the main contract continuously increased, with bulls in the dominant position. The market's consensus on a bullish outlook was strong. After the accelerated upward movement of cotton prices on Friday, short - position holdings increased, and the long - short ratio weakened slightly, so short - term correction should be guarded against [26]. - **Month - spread structure**: Currently, Zhengzhou cotton 1 - 5 shows a slight back structure supported by industrial - end delivery, while contracts 05 and later maintain a contango structure. The far - month contracts maintain the expectation of tight supply - demand at the end of the year and show a strong trend [29]. - **Basis structure**: This week, the low - end of the cotton basis remained stable, and the high - end slightly decreased. The pick - up price of machine - picked cotton in Xinjiang was 14,960 yuan/ton for grade 3128B and 15,200 yuan/ton for grade 2129B. The sales basis of machine - picked cotton in Shihezi, Xinjiang, with a impurity content of less than 2.7% for the 2605 contract in Xinjiang warehouses was 920 - 1030 yuan/ton, and the pick - up price was 15,080 - 15,250 yuan/ton [32]. Chapter 4: Valuation and Profit Analysis 4.1 Downstream Spinning Profit Tracking - With policy support and technological innovation, Xinjiang yarn mills have a significant cost advantage over those in the inland, maintaining a certain profit. Inland mills were basically in a slight loss in the third quarter. From September, domestic cotton prices declined under the hedging pressure of ginning mills and the supply pressure of new cotton, while yarn spot prices were relatively stable, restoring domestic yarn mills' profits. In December, domestic cotton prices rebounded, squeezing yarn mills' profits again. This week, as cotton prices further increased and yarn prices slightly increased, yarn mills' profits weakened slightly compared with last week [34][35]. 4.2 Import Profit Tracking - Affected by the Xinjiang cotton ban and tariff policies, the price trends of domestic and foreign cotton are relatively independent. This year, China's cotton import profit has been considerable, but the import quota is low, resulting in a low level of cotton imports. In November 2025, China's cotton import volume was 120,000 tons, up 30,000 tons month - on - month and 10,000 tons year - on - year. The cumulative cotton import volume in the 25/26 season was 310,000 tons, down 30,000 tons year - on - year. This week, domestic cotton prices further increased, and foreign cotton prices stabilized and rebounded, slightly expanding the domestic cotton import profit [37]. Chapter 5: Supply and Inventory Deduction 5.1 Supply - Demand Balance Sheet Deduction - The new - year Xinjiang cotton harvest is basically completed, and the output forecast has been slightly revised upwards. In terms of imports, the National Development and Reform Commission has issued an additional 200,000 - ton sliding - scale duty quota, and together with the 894,000 - ton 1% tariff quota for 2026, the new - year cotton import volume is tentatively estimated at 1.1 million tons. The probability of further increasing the sliding - scale duty quota is low. Downstream, domestic demand may maintain a moderate recovery, and the export market is expected to support domestic cotton consumption due to the easing of Sino - US trade relations [42]. - The supply - demand balance sheet shows that in the 25/26 season, cotton production is expected to be 7.6 million tons, imports 1.1 million tons, consumption 8.6 million tons, and the ending inventory 6.26 million tons, with an inventory - to - consumption ratio of 72.79% [43].

1. Report Industry Investment Rating No information provided. 2. Core Viewpoints of the Report - The main factors driving the current rebound in cotton are a 10% reduction in export tariffs to the US, an increase in exports on a month - on - month basis, stronger restocking willingness among downstream enterprises due to rising cotton prices, and significant policy - controlled reduction in the planting area of Xinjiang cotton in the new year. The short - term bullish factors for the main 05 contract remain unchanged, and it is expected to continue its volatile upward trend. However, the price may not rise steadily but instead fluctuate upwards in a "three - steps - forward - two - steps - back" pattern. A bullish mindset is recommended, and short - term long positions can be taken when the price pulls back [4]. - There are both bullish and bearish factors in the cotton market. Bullish factors include the regulation of Xinjiang cotton planting area in 2026 with an expected reduction of over 10%, pre - holiday restocking by downstream enterprises, and a 10% reduction in export tariffs to the US compared to the previous period. Bearish factors are a decline in overall foreign trade orders, an increase in inventory, a large amount of new cotton on the market, and the current traditional off - season for consumption [5][6]. 3. Summary by Directory 3.1 Previous Day Review No information provided. 3.2 Daily Tips - **Fundamentals**: In 2026, the planting area of Xinjiang cotton is expected to be reduced by over 10%. According to the ICAC November report, the output in the 2025/2026 season is 25.4 million tons, and consumption is 25 million tons. The USDA November report shows that the output in the 2025/2026 season is 26.145 million tons, consumption is 25.883 million tons, and the ending inventory is 16.532 million tons. In November, textile and clothing exports were $23.869 billion, a year - on - year decrease of 5.12%. In November, China imported 120,000 tons of cotton, a year - on - year increase of 9.4%, and 150,000 tons of cotton yarn, a year - on - year increase of 25%. According to the Ministry of Agriculture's December 2025/2026 forecast, the output is 6.7 million tons, imports are 1.4 million tons, consumption is 7.6 million tons, and the ending inventory is 8.35 million tons [4]. - **Basis**: The national average price of spot 3128b cotton is 15,271 yuan, and the basis for the 05 contract is 1,091 yuan, indicating a premium over futures [4]. - **Inventory**: The Ministry of Agriculture of China estimates the ending inventory in December 2025/2026 to be 8.35 million tons [4]. - **Market Chart**: The 20 - day moving average is upward, and the K - line is above the 20 - day moving average [4]. - **Main Position**: The net short position has increased, and the main - force trend is unclear [4]. - **Expectation**: The short - term bullish factors for the main 05 contract remain unchanged, and it is expected to continue its volatile upward trend. A bullish mindset is recommended, and short - term long positions can be taken when the price pulls back [4]. 3.3 Today's Focus No information provided. 3.4 Fundamental Data - **USDA Global Cotton Supply - Demand Forecast**: In 2025/2026, the total global output is 26.081 million tons, a decrease of 64,000 tons compared to the previous forecast; consumption is 25.873 million tons, a slight decrease; imports are 9.522 million tons, a decrease of 59,000 tons; exports are 9.524 million tons, a decrease of 56,000 tons; and the ending inventory is 16.541 million tons, an increase of 9,000 tons [10][11]. - **ICAC Global Cotton Supply - Demand Forecast**: In 2025/2026, the output is 25.39956 million tons, consumption is 25.00778 million tons, and the ending inventory is 16.22785 million tons, with an inventory - to - consumption ratio of 0.65 [13]. - **China Cotton Supply - Demand Forecast**: According to the Ministry of Agriculture, in the 2025/2026 season, the output is 6.7 million tons, imports are 1.4 million tons, consumption is 7.6 million tons, and the ending inventory is 8.35 million tons [4]. 3.5 Position Data No information provided.

1. Report Industry Investment Rating There is no information provided about the industry investment rating in the report. 2. Core Viewpoint of the Report The current new - season Xinjiang cotton harvest is abundant, and domestic commercial inventories have rapidly rebounded. In the short term, there is still supply and hedging pressure above. However, based on the low inventory from the previous year and the expected low imports in the new year, the overall increase in domestic supply in the new year has narrowed. Downstream, domestic spinning capacity has expanded, Xinjiang yarn mills have maintained high - load operations, and the rigid demand for cotton consumption has increased. Domestic demand shows a moderate growth trend supported by macro - policies. At the same time, the reduction of Sino - US tariffs is conducive to the recovery of China's textile and clothing exports, supporting domestic cotton consumption. The supply - demand outlook for domestic cotton in the new year is expected to be tight, and the center of cotton prices is expected to rise. Attention should be paid to whether the Xinjiang target price subsidy policy will be adjusted next year, as the area of new - season Xinjiang cotton is still variable. The predicted range for Zhengzhou cotton is around 13,500 - 15,500 yuan/ton [1][37]. 3. Summary by Relevant Catalogs 3.1 Market Review - **Zhengzhou Cotton**: In 2025, Zhengzhou cotton fell rapidly in the second quarter and then rebounded, fluctuating in the range of 13,200 - 14,300 yuan/ton with low volatility. At the beginning of the year, domestic textile enterprises replenished raw materials rigidly at low prices, but with high cotton inventories, cotton prices fluctuated. During the Tomb - Sweeping Festival, due to the significant increase in US foreign tariffs, Zhengzhou cotton dropped sharply, but after the Sino - US talks, the tariff policy was postponed, and cotton prices rebounded. With low domestic imported cotton and better - than - expected downstream demand, Xinjiang cotton destocked quickly, and the year - end inventory was low, so cotton prices were strong. However, with the upcoming new cotton listing and a large number of pre - sales for the new year, ginneries hedged in advance under the expectation of a bumper Xinjiang cotton harvest, and cotton prices fell before the acquisition period, then fluctuated slightly with the new - season output expectation [1]. - **US Cotton**: In 2025, US cotton fluctuated narrowly in the range of 63 - 70 cents/pound. At the beginning of the year, the export progress of the 24/25 US cotton season was slow, and the unpriced purchase contracts and non - commercial short positions were high, with significant upward pressure. After the implementation of the US import tariff increase policy, cotton prices tested down to around 60 cents/pound, but after the annual export target was completed, cotton prices recovered. Then, US cotton fluctuated narrowly under the expectations of slow export contracts and a decline in new - cotton output. With the upward adjustment of the global output expectation, the global cotton supply - demand outside China was loose, and the trend of US cotton was weakening [6]. 3.2 Core Concerns 3.2.1 Xinjiang Cotton Output Reaches a New High, Pay Attention to Next Year's Policy Adjustment - **Output**: The new - season Xinjiang cotton output is expected to be high. The initial national estimate is that the average yield per mu in Xinjiang is 171.8 kg, an increase of 3.7% year - on - year, and the output is 704.7 tons, an increase of 12.2% year - on - year. The national total cotton output is expected to be 740.9 tons, an increase of 11.0% year - on - year. The current market mainstream estimates that Xinjiang's output has increased to 730 - 750 tons, and the China Cotton Information Network has adjusted the national output expectation to 767.9 tons, an increase of 12% year - on - year, with Xinjiang's output increasing to 736.9 tons. As of December 15, 2025, the national new - season cotton notarized inspection volume was 544.05 tons, an increase of 13.89% year - on - year [8]. - **Acquisition**: This year, there are 1069 target - price reform processing enterprises in Xinjiang. The cotton processing capacity is still in excess, but ginneries have low risk preferences, and the new - cotton acquisition price is relatively stable. There were many pre - sales of new cotton this year, and the sales speed was fast. Some enterprises hedged in advance, causing Zhengzhou cotton to fall before the National Day, and the overall new - cotton acquisition price was low. The acquisition price in southern Xinjiang is slightly higher than that in northern Xinjiang, and there is still some high - cost new cotton in southern Xinjiang to be hedged [8][10]. - **Policy**: This year is the last year of the 18,600 yuan/ton target - price subsidy policy for cotton. Attention should be paid to the adjustment of the subsidy policy next year and its impact on farmers' enthusiasm for cotton planting [10]. 3.2.2 Imports Remain Low, Quota Supply is Limited - **Import Volume**: From January to November 2025, China's cumulative cotton imports were 900,000 tons, a decrease of 1.6 million tons year - on - year, and cumulative棉纱 imports were 1.33 million tons, a decrease of 40,000 tons year - on - year. The domestic - foreign cotton price difference has been at a relatively high level, and the import profit is considerable, but the import quota is limited. The 1% import tariff quota for cotton in 2026 remains at 894,000 tons, plus the additional 200,000 - ton sliding - scale tariff quota issued at the end of August 2025. The probability of further increasing the cotton import quota is low, and the new - year import volume is expected to be around 1.1 million tons, similar to the 24/25 season [13]. 3.2.3 Demand is Resilient, Pay Attention to Policy Support - **Domestic Demand**: From January to November 2025, the retail sales of domestic clothing, footwear, needles, and textiles totaled 1.37029 trillion yuan, an increase of 4.91% year - on - year. Since August, the year - on - year growth rate of domestic textile and clothing retail sales has exceeded that of social consumer goods retail sales. The China Cotton Textile PMI has been rising since the third quarter and returned above the boom - bust line in October. In the "Golden September and Silver October" peak season, domestic textile enterprises' order - receiving situation improved later. With the decline in cotton prices, spinning profits were repaired, and downstream product destocking was good. The expansion of Xinjiang's spinning capacity and the high - load operation of yarn mills have increased the rigid demand for cotton. With the continuous influence of consumption - promotion policies next year, domestic terminal textile and clothing sales are expected to maintain a moderate growth trend [18][19]. - **Export Demand**: From January to November 2025, China's total textile and clothing export volume was 267.853 billion US dollars, a decrease of 2.09% year - on - year. Since July, exports have declined continuously. After the Sino - US summit in October, the US tariff policy was adjusted, which is beneficial to China's textile and clothing exports. In November, exports rebounded month - on - month. From January to October 2025, China's cotton - product exports totaled 55.086 billion US dollars, a decrease of 6.45% year - on - year, and the export volume was 6.1442 million tons, an increase of 7.76% year - on - year, showing a "quantity - for - price" situation, which still supports cotton consumption [22][23]. 3.2.4 Low Cotton - Grain Price Ratio in the US, Slow Cotton Export Progress - **Output**: In the 25/26 season, due to the low cotton - grain price ratio in the US, the cotton - planting area decreased. However, the drought in Texas has been significantly alleviated, the national cotton abandonment rate has decreased by 5.28 percentage points to 20.7%, and the yield per mu has increased by 4.9% to 69.4 kg. The USDA predicts that the US cotton output in the 25/26 season will be 3.106 million tons, a decrease of 1% year - on - year. If the cotton - grain price ratio remains low before the planting season next year, it may further suppress farmers' enthusiasm for cotton planting [25]. - **Export**: As of November 20, 2025, the US's cumulative net export contracts for 25/26 - season cotton were 1.306 million tons, a decrease of 262,000 tons year - on - year, reaching 49.16% of the annual expected export volume. China's cumulative import contracts for 25/26 - season US cotton were only 39,000 tons, a decrease of 112,000 tons year - on - year. Vietnam's cumulative import contracts were 379,000 tons, accounting for 29.02% of the contracted US cotton. Pakistan's cumulative import contracts were 138,000 tons, accounting for 10.57% of the contracted US cotton. US cotton exports have been affected by high tariffs, and the export progress has been slow. In the future, with the competition from Brazilian cotton exports, attention should be paid to changes in US foreign tariff policies [30]. 3.2.5 Abundant Foreign New - Cotton Supply, Loose Global Supply - Demand Outlook According to the USDA's December global cotton supply - demand report, the global cotton output in the 25/26 season is expected to be 26.081 million tons, an increase of 111,000 tons year - on - year. China and Brazil continue to increase production, and the US's production decline is narrower than previously expected. The global cotton output is at a relatively high historical level. The global cotton consumption is expected to be 25.823 million tons, a decrease of 71,000 tons year - on - year. The global cotton ending inventory is expected to be 16.541 million tons, an increase of 296,000 tons year - on - year. The global cotton supply - demand pattern is loose. Attention should be paid to the adjustment of trade policies between countries and the impact of US interest - rate cuts on terminal consumption [35]. 3.3 Valuation Feedback and Supply - Demand Outlook The new - season Xinjiang cotton harvest is abundant, and domestic commercial inventories have rebounded rapidly. In the short term, there is supply and hedging pressure. However, due to the low inventory in the previous year and the expected low imports in the new year, the increase in domestic supply has narrowed. Downstream demand is strong, and domestic cotton consumption is supported. The new - year domestic cotton supply - demand is expected to be tight, and cotton prices are expected to rise. Attention should be paid to the adjustment of the Xinjiang target - price subsidy policy next year, as the area of new - season Xinjiang cotton is still variable [37].

Report Summary 1. Report Industry Investment Rating No information provided in the report. 2. Core Viewpoints - This week, cotton continued to fluctuate upwards, with improved fundamentals, stable tariffs on the US, and increased confidence in foreign trade exports. The short - term negative factors have been exhausted, and the futures are expected to fluctuate upwards in the short term. As the 01 contract approaches delivery, trading is shifting to the 05 contract. It is recommended to go long on dips [5]. - There are both positive and negative factors in the market. Positive factors include pre - holiday restocking by downstream enterprises and a 10% reduction in export tariffs to the US compared to the previous period. Negative factors include a decline in overall foreign trade orders, an increase in inventory, the upcoming large - scale listing of new cotton, and the current traditional consumption off - season [6][7]. 3. Summary by Directory 3.1 Previous Day Review - This week, cotton continued to fluctuate upwards. The ICAC 11 - month report shows that the output in the 25/26 season is 25.4 million tons and consumption is 25 million tons. The USDA 11 - month report shows that the output in the 25/26 season is 26.145 million tons, consumption is 25.883 million tons, and the ending inventory is 16.532 million tons. In October, textile and clothing exports were $22.262 billion, a year - on - year decrease of 12.63%. In October, China imported 90,000 tons of cotton, a year - on - year decrease of 15.6%, and 140,000 tons of cotton yarn, a year - on - year increase of 16.7%. The Ministry of Agriculture's December 25/26 season data shows an output of 6.7 million tons, imports of 1.4 million tons, consumption of 7.6 million tons, and an ending inventory of 8.35 million tons [5]. 3.2 Daily Tips No information provided in the report. 3.3 Today's Focus No information provided in the report. 3.4 Fundamental Data - **USDA Global Cotton Supply - Demand Balance Table**: It shows the production, consumption, import, export, and ending inventory of cotton in different countries and regions from 2021/22 to 2025/26. For example, in 2025/26, the total global production is 26.081 million tons, consumption is 25.873 million tons, imports are 9.522 million tons, exports are 9.524 million tons, and the ending inventory is 16.541 million tons [13][14]. - **ICAC Global Cotton Supply - Demand Balance Table**: In the 2025/26 season, the area is 30.41385 million hectares, the yield per unit area is 835.13 kg/ha, the output is 25.39956 million tons, the initial inventory is 15.83577 million tons, imports are 9.71442 million tons, consumption is 25.00778 million tons, exports are 9.71412 million tons, the ending inventory is 16.22785 million tons, and the inventory - to - consumption ratio is 0.65 [16]. - **China Cotton Supply - Demand Balance Table**: The data source is the Ministry of Agriculture, but specific data is not detailed in the current text [18]. - **Polyester Fiber Price**: The price trend of polyester fiber (P0Y150D/48F) in the Chinese market is presented [21]. - **Cotton Mill Processing Profit**: The daily processing profit of cotton mills is shown, with the latest data date of December 12, 2025 [22]. - **Spinning Mill Immediate Profit**: The daily immediate profit of spinning mills in China is presented, with the latest data date of December 12, 2025 [24]. - **China's Cotton Yarn Import Quantity**: The monthly import quantity of cotton yarn in China is shown, with the latest data date of October 31, 2025 [29]. - **Cotton Yarn Spinning Mill Operating Rate**: The weekly operating rate of pure cotton yarn spinning mills in China is presented, with the latest data date of December 12, 2025 [30]. - **Weaving Mill Operating Rate**: The weekly operating rate of weaving mills is shown, with the latest data date of December 12, 2025 [32]. 3.5 Position Data - **Basis**: The basis of cotton 05 contract is presented [34]. - **Spread**: No detailed information provided in the report. - **Import Arrival Quotation**: No detailed information provided in the report. - **Warehouse Receipt Situation**: No detailed information provided in the report. - **Industrial Inventory (Monthly)**: No detailed information provided in the report. - **Spinning Mill Cotton Inventory in Days**: The weekly inventory in days of cotton in spinning mills is presented, with the latest data date of December 12, 2025 [53].

1. Report's Investment Rating for the Industry - The report's impact on the cotton industry is generally neutral [1] 2. Core Viewpoints of the Report - The USDA's December report made minor adjustments to the supply - demand data of major cotton - producing countries, with a neutral overall influence [1] - In the 2025/26 season, global cotton supply remains relatively loose, and in the medium - short term, U.S. cotton may continue to fluctuate in a low - level range [2] 3. Summary According to Related Contents 3.1 Supply - Demand Data Adjustments in the 2025/26 Season - **Production**: Global production was下调 by 64,000 tons. U.S. production increased by 34,000 tons to 3.107 million tons, and the rest of the major producers remained unchanged. The U.S. cotton harvest area was unchanged, but the yield per unit area increased from 919 pounds per acre in November to 929 pounds per acre [1] - **Consumption**: Global consumption decreased by 60,000 tons, with a 22,000 - ton decrease in Brazil's consumption, and the rest of the major consumers remained stable [1] - **Imports**: Global cotton imports decreased by 59,000 tons month - on - month, with a 21,000 - ton decrease in Vietnam's imports and a 22,000 - ton decrease in Bangladesh's imports. China's imports were unchanged [1] - **Exports**: Global exports decreased by 56,000 tons, and the main exporting countries remained unchanged [1] - **End - of - Season Inventory**: Global end - of - season inventory increased slightly by 9,000 tons month - on - month, with a 1,000 - ton decrease in China's inventory, a 44,000 - ton increase in the U.S. inventory, and a 45,000 - ton increase in Brazil's inventory [2] 3.2 Data in the Global Cotton Supply - Demand Balance Sheet - **Production**: The total global production in 2025/26 (December) was 24.894 million tons, a decrease of 64,000 tons compared to the previous month [3] - **Consumption**: The total global consumption in 2025/26 (December) was 25.894 million tons, a decrease of 60,000 tons compared to the previous month [3] - **Imports**: The total global imports in 2025/26 (December) were 9.59 million tons, a decrease of 59,000 tons compared to the previous month [3] - **Exports**: The total global exports in 2025/26 (December) were 9.231 million tons, a decrease of 56,000 tons compared to the previous month [3] - **End - of - Season Inventory**: The total global end - of - season inventory in 2025/26 (December) was 16.541 million tons, an increase of 9,000 tons compared to the previous month [3]

Report Industry Investment Rating - The report's impact on the cotton industry is generally neutral [1] Core Viewpoints - The USDA's December report made minor adjustments to the supply - demand data of major cotton - producing countries. In the 2025/26 season, the global supply remains relatively loose, and in the short - to - medium term, US cotton may continue to fluctuate in a low - level range [1][2] Summary by Related Catalogs Global Cotton Supply - Demand Data Adjustments - **Production**: The global production in the 2025/26 season was下调 by 64,000 tons. The US production was上调 by 34,000 tons to 3.107 million tons, while other major producers remained unchanged. The US cotton harvest area was unchanged, and the yield per unit was上调 from 919 pounds per acre in November to 929 pounds per acre [1] - **Consumption**: Global consumption in the 2025/26 season was下调 by 60,000 tons, with Brazil's consumption下调 by 22,000 tons, and other major consumers remaining stable [1] - **Imports**: Global cotton imports were环比下调 by 59,000 tons in the 2025/26 season. Vietnam's imports were下调 by 21,000 tons, and Bangladesh's imports were下调 by 22,000 tons, while China's imports remained unchanged [1] - **Exports**: Global exports were下调 by 56,000 tons, and major exporters remained unchanged [1] - **Ending Stocks**: Global ending stocks in the 2025/26 season were环比小幅上调 by 9,000 tons. China's ending stocks were下调 by 1,000 tons, while the US's were上调 by 44,000 tons and Brazil's by 45,000 tons [2] Supply - Demand Balance Sheets - **Global Cotton Supply - Demand Balance Sheet**: Presents production, consumption, import, export, and ending stock data of major cotton - producing and consuming countries from 2021/22 to 2025/26 - 12, along with monthly and annual changes [3] - **US Cotton Supply - Demand Balance Sheet**: Displays data on production, harvest area, and ending stocks in the US cotton market in tons and thousands of hectares [6] - **China Cotton Supply - Demand Balance Sheet**: Shows data on production, consumption, imports, and ending stocks in the Chinese cotton market, as well as the inventory - to - sales ratio [9] - **India Cotton Supply - Demand Balance Sheet**: Presents production, domestic consumption, and ending stock data in the Indian cotton market [14] - **Pakistan Cotton Supply - Demand Balance Sheet**: Displays data on production, domestic consumption, imports, and ending stocks in the Pakistani cotton market [17] - **Brazil Cotton Supply - Demand Balance Sheet**: Shows data on domestic consumption and ending stocks in the Brazilian cotton market [20] - **Australia Cotton Supply - Demand Balance Sheet**: Presents production and ending stock data in the Australian cotton market [23]