Report Summary 1. Investment Rating No investment rating for the industry is provided in the report. 2. Core View - The Zhengzhou cotton (ZCE) main contract 2509 decreased by 0.22%, closing at 13,640 yuan/ton, down 30 yuan/ton from the previous trading day. The positions and trading volume both decreased, with the main force gradually shifting to the next contract. The ICE cotton slightly declined, dropping 0.84% overnight to close at 66.36 cents/pound. Future attention should be paid to the meeting between the leaders of Russia and the United States, the pace of the Fed's interest rate cuts, and the marginal impact of domestic policies [2]. - Internationally, due to factors such as the continuous loose global cotton supply - demand situation and the weak export demand for US cotton, the international cotton price generally maintains a weak consolidation trend. Domestically, although the de - stocking trend of cotton commercial inventory is good, it remains at a high level. The main contract is in the process of position - shifting. With the high probability of a good harvest of new cotton this year and the continued slump in demand, the upward space for Zhengzhou cotton is limited [14]. 3. Summary by Directory 3.1. Market Review - The ZCE main contract 2509 of cotton decreased by 0.22%, closing at 13,640 yuan/ton, down 30 yuan/ton from the previous trading day. The positions and trading volume both decreased, and the main force is shifting contracts. The ICE cotton dropped 0.84% overnight, closing at 66.36 cents/pound [2]. 3.2. Macroeconomic and Industry News - On August 8, 2025, the total cotton warehouse receipts on the Zhengzhou Commodity Exchange were 8,582 (-95) sheets, including 8,252 (-77) registered warehouse receipts and 330 (-18) valid forecasts [3]. - In July, enterprises with an operating rate of 90% and above accounted for 38.78%, a decrease of 10.16 percentage points from the previous month; those with an operating rate of 61% - 89% accounted for 38.78%, an increase of 11.12 percentage points; those with an operating rate of 31% - 60% accounted for 22.45%, a decrease of 0.95 percentage points; and no enterprises had an operating rate below 30%, the same as the previous month [4][5]. - In July 2025, China's textile and clothing exports were 26.766 billion US dollars, a year - on - year decrease of 0.06% and a month - on - month decrease of 2.01% [5]. - In the week of July 31, the net signing of US 2024/25 - year land cotton was - 3,901 tons, and the shipment was 41,345 tons. There was no signing of Pima cotton, and the shipment was 2,041 tons. The carry - over to the 2025/26 new - year cotton was 135,715 tons. As of the same period, the net signing of 2025/26 - year land cotton was 24,789 tons, and the net signing of Pima cotton was 1,202 tons. The shipment of the new year has not started. In the week, 7,099 tons of 2026/27 - year land cotton were signed, and no Pima cotton was signed for the next year. China's net signing volume of 2025/26 - year land cotton was - 23 tons and the shipment was 0 tons. 522 tons of Pima cotton were signed, and no Pima cotton was shipped. 249 tons of new - year cotton resources were signed [5]. - As of July 31, 2025, China had cumulatively signed and imported 169,000 tons of US cotton in the 2024/25 year, accounting for 6.07% of the signed US cotton; the cumulative shipment of US cotton was 166,000 tons, accounting for 6.31% of the total US cotton shipment and 98.68% of China's signed volume [6]. - In June, China imported 560 million US dollars of intermediate products, a year - on - year decrease of 13.7%, including 360 million US dollars of imported yarn, a year - on - year decrease of 12.9%, and 200 million US dollars of imported fabrics, a year - on - year decrease of 15.2%. In terms of exports, in June, China exported 6.92 billion US dollars of intermediate products, a year - on - year decrease of 2.1%, including 1.24 billion US dollars of exported yarn, a year - on - year increase of 1.8%, and 5.68 billion US dollars of exported fabrics, a year - on - year decrease of 2.9% [6]. 3.3. Data Charts - The report provides multiple data charts, including CZCE and ICE cotton futures prices, cotton spot prices and basis, 9 - 1 spreads, textile profits, cotton import profits, yarn import profits, warehouse receipt quantities, and non - commercial positions [8][9][11][12]. 3.4. Analysis and Strategy - Internationally, the US Middle East envoy has arrived in Russia, and Trump has set August 8 as the "deadline" for a cease - fire in the Russia - Ukraine war. The future policies and sanctions of the Trump administration after August 8 can be continuously monitored. The international cotton price maintains a weak consolidation trend due to factors such as loose supply - demand and weak export demand [14]. - Domestically, the cotton commercial inventory is de - stocking well but remains at a high level. The main contract is shifting positions. With the high probability of a good harvest of new cotton this year and weak demand, the upward space for Zhengzhou cotton is limited [14].

Report Summary 1. Investment Rating No investment rating for the industry is provided in the report. 2. Core Viewpoints - The main contract of Zhengzhou cotton (2509) decreased by 0.15%, closing at 13,670 yuan/ton, down 20 yuan/ton from the previous trading day. Trading volume sharply declined, and the contract is in the process of position transfer. ICE cotton slightly dropped by 0.36%, closing at 66.92 cents/pound. Future attention should be paid to the marginal impact of external market trends, the Fed's interest - rate cut rhythm, and domestic policy directions [2]. - Internationally, the international cotton price remains in a weak consolidation state due to factors such as the continuous loose global cotton supply - demand situation and weak US cotton export demand. Domestically, the commercial cotton inventory is decreasing, but it is still at a high level. The new cotton this year is likely to have a good harvest, and the demand is still weak, so the upward space for Zhengzhou cotton is limited [16]. 3. Summary by Section 3.1 Market Overview - Zhengzhou cotton's main 2509 contract decreased by 0.15%, closing at 13,670 yuan/ton, down 20 yuan/ton from the previous day. Trading volume decreased significantly, and the contract is in the position - transfer stage. ICE cotton slightly dropped by 0.36%, closing at 66.92 cents/pound. Future attention should be paid to external market trends, the Fed's interest - rate cut rhythm, and domestic policy directions [2]. 3.2 Macroeconomic and Industry News - On August 7, 2025, the total cotton warehouse receipts on the Zhengzhou Commodity Exchange were 8,677 (-135) sheets, with registered warehouse receipts at 8,329 (-135) sheets and valid forecasts at 348 (+0) sheets [3]. - The International Cotton Advisory Committee (ICAC) predicts that the global cotton trade volume will remain stable at 9.7 million tons. The global cotton production in the 2025/26 season is expected to reach 25.9 million tons, slightly exceeding the expected consumption of 25.6 million tons. India will maintain its position as the country with the largest cotton - planting area, accounting for 38% of the global total. China is expected to continue leading in cotton production, accounting for 24% of the global total, and remain the largest cotton consumer, with an expected consumption of 8.2 million tons, accounting for 32% of the global total. The ICAC estimates the cotton price for the next season to range from 57 to 94 cents/pound, with a median of 73 cents/pound [3][4]. - As of August 4, 2025, the cotton flowering rate in Xinjiang was about 98%, a 3.7 - percentage - point increase from the previous period. The flower positions were mainly on the 9th, 10th, and 11th fruiting branches, with an average boll number of 8.6, an increase of 1.4 from the previous period [4]. - US President Trump announced an additional 25% tariff on Indian goods due to India's continuous import of Russian oil. The new tariff will take effect 21 days after August 7, and the comprehensive tax rate for some Indian goods will rise to 50% [4]. - The cotton - picking operation in South Texas, USA, has expanded, and there has been continuous rainfall in the southeastern cotton - growing area. In Brazil, the cotton - picking progress in the main production area continues to advance. As of August 1, the picking progress in Mato Grosso state increased by 8.5 percentage points to 18.3% month - on - month, 16.4 percentage points behind the same period last year [5]. 3.3 Data Charts The report provides multiple data charts, including CZCE and ICE cotton futures prices, cotton spot prices and basis, 9 - 1 spread, textile profit, cotton import profit,棉纱 import profit, warehouse receipt quantity, and non - commercial positions [7][8][11]. 3.4 Analysis and Strategies - Internationally, the US Middle East envoy has arrived in Russia, and Trump has set August 8 as the "deadline" for a cease - fire in the Russia - Ukraine war. The situation of the war makes an immediate cease - fire unlikely. The international cotton price remains in a weak consolidation state due to factors such as the continuous loose global cotton supply - demand situation and weak US cotton export demand [16]. - Domestically, the cotton commercial inventory has been decreasing, but it is still at a high level. The main contract is in the position - transfer stage. The new cotton this year is likely to have a good harvest, and the demand remains weak, so the upward space for Zhengzhou cotton is limited [16].

Report Overview - Report Title: 20250801 Cotton Series Monthly Report: Weakening De-stocking Expectations due to Negative Demand Feedback, Waiting for Cotton Prices to Find the Bottom in the Off-season [1] - Report Date: August 1, 2025 [1] - Team: Agricultural Products Team [1] Industry Investment Rating - Not provided in the report Core Viewpoints - The negative feedback in demand has weakened the de-stocking expectations, and it is necessary to wait for cotton prices to find the bottom in the off-season [1] - In the short term, US cotton is expected to fluctuate weakly, while Zhengzhou cotton is expected to be bearish. For short positions, consider gradually reducing positions to take profits, and pay attention to the opportunity of low-cost long positions in far-month contracts after the market risk is further released [2] Summary by Directory Macro - According to the consensus of the new round of China-US economic and trade talks, both sides will continue to promote the extension of the suspended 24% part of the US reciprocal tariffs and China's countermeasures as scheduled. Pay attention to Trump's final decision before August 12 [2] - The Federal Reserve has kept the federal funds rate target range unchanged at 4.25% - 4.5% for the fifth consecutive time, in line with expectations. Recently, the expectation of a Fed rate cut in September has cooled sharply under the impact of Fed Chairman Powell's hawkish remarks [2] - The domestic Politburo meeting continued to mention "making progress while maintaining stability", "timely increasing efforts", "implementing in detail", "boosting consumption", and "governing disorderly competition", and continued to promote the acceleration of the domestic cycle [2] Supply - **International**: The soil conditions in the main cotton-producing areas have weakened slightly. The non-drought rate has decreased to 93% under the influence of drought in the Midwest, but it is still much higher than the same period. The latest good-to-excellent rate of US cotton is 55%, down from 57% the previous week and up from 49% the same period last year. The supply pressure in the US cotton area has weakened. In India, 9.86 million hectares of new cotton have been planted, a year-on-year decrease of 3.4%. The spot cotton price has stopped rising and fallen, and the CCI has cumulatively auctioned and sold 1.22 million tons of cotton. In Brazil, the latest harvest progress has reached 21.7%, with the harvest progress in the main producing state of Bahia at 40% and that in the state of Mato Grosso at 12.6% [2] - **Domestic**: Xinjiang cotton has entered the flowering and boll-forming stage. The actual sown area of cotton is 45.803 million mu, a year-on-year increase of 6.3%. It is estimated that the yield per mu of new cotton in 2025 will be 158.7 kg, a year-on-year increase of 2.5%, and the guaranteed output is expected to be raised to 7.4 million tons. The high-temperature weather in August is expected to gradually improve compared with July, and the probability of weather speculation is low. In June, China imported about 30,000 tons of cotton, a decrease of about 10,000 tons from the previous month. The import volume of cotton yarn in June was 110,000 tons, an increase of about 10,000 tons from the previous month. The total import volume of cotton resources was basically the same as that in May, and no quota policy has been introduced [2] Inventory - **Domestic**: The total industrial and commercial inventory is slightly lower than that of the same period last year by about 40,000 tons, and the inventory in Xinjiang is lower than that of the same period by about 200,000 tons. It is estimated that the national commercial inventory by early September will be comparable to the average level of the past five years. Pay attention to the possible slowdown in the recent de-stocking speed. At the finished product end, the replenishment of cotton yarn and grey cloth has slowed down significantly this week, and the negative feedback expectation after the weakening of the downstream replenishment willingness is gradually reflected in the market [2] - **International**: In May 2025, the inventory value of clothing and clothing fabrics of US wholesalers was $28.636 billion, a year-on-year decrease of 0.73% and a month-on-month increase of 0.49%. The inventory value of retailers in May was $58.056 billion, a year-on-year decrease of 2.47% and a month-on-month decrease of 0.49%. The overall inventory level of US clothing is still relatively neutral, and the inventory at the retail end needs further de-stocking [2] Demand - **Domestic**: The orders of textile enterprises have dropped to the lowest level in the past five years. The operating rates of weaving mills and spinning mills have accelerated their decline and are lower than those of the same period. The cotton cloth transactions in the Light Textile City have been running at a recent low level. The overall price center of clothing fabrics and accessories in the Keqiao market has improved, which may indicate that the foreign trade situation is not overly pessimistic. In June 2025, the cumulative export value of textiles and clothing reached $143.98 billion, a year-on-year increase of 0.8%. The cumulative export value of textiles in June reached $70.52 billion, a year-on-year increase of 1.8%. The cumulative export of clothing in June reached $73.46 billion, a year-on-year decrease of 0.2%. Overall, affected by the slowdown in the export growth rate of textiles, the export growth rate of clothing and textiles has further slowed down. The US market performed slightly better than last month, and the ASEAN and EU markets were relatively stable. Pay attention to whether the extension of China-US tariffs can be finally confirmed [2] - **International**: The soil moisture in the main producing areas of US cotton has slightly deteriorated but is still suitable for the growth of new cotton. The trade negotiations between the US and other countries are still ongoing, and the export demand for US cotton in the second half of the year still needs to be viewed with caution [2] Cotton Supply and Demand Balance Sheet (July) - **Production**: In the 2025/26 season, the global production is expected to increase by 311,000 tons month-on-month to 25.78 million tons. Among them, China's production is expected to increase by 218,000 tons month-on-month to 6.749 million tons, the US production is expected to increase by 131,000 tons month-on-month to 3.048 million tons, and Pakistan's production is expected to decrease by 44,000 tons to 1.089 million tons [3] - **Consumption**: In the 2025/26 season, the global consumption is expected to increase by 78,000 tons month-on-month to 25.718 million tons. Among them, Pakistan's consumption is expected to increase by 65,000 tons to 2.373 million tons, and the remaining small countries will share the rest [4] - **Trade**: In the 2025/26 season, the global imports and exports are expected to decline slightly by 20,000 - 30,000 tons month-on-month. Among them, China's imports are expected to decrease by 152,000 tons month-on-month to 1.263 million tons, and Pakistan's imports are expected to increase by 131,000 tons to 1.284 million tons [4] - **Ending Inventory**: In the 2025/26 season, the global ending inventory is expected to increase by 113,000 tons month-on-month to 16.833 million tons. Among them, China's ending inventory is expected to increase by 11,000 tons to 8.07 million tons, and the US ending inventory is expected to increase by 65,000 tons to 1.001 million tons [4] Cotton Futures and Spot - The cotton price rose and then fell within the month, and the basis level remained high [5] Cotton Yarn Futures and Spot - The futures price of cotton yarn rose and then fell within the month, and the basis performance was weaker than that of cotton [12] Supply Details - The actual sown area of US cotton is higher than expected, and the drought in the Midwest has pushed the good-to-excellent rate to decline slightly. As of the week ending July 27, 2025, the good-to-excellent rate of US cotton was 55%, down from 57% the previous week and up from 49% the same period last year. The non-drought rate in the main cotton-producing areas of the US decreased by 3% to 93%, which is 45% higher than the same period. The drought situation has slightly increased, but the soil moisture is still at the best level in the past five years, and the abandonment rate has dropped to 14.427% [14][15] - The de-stocking of raw materials has been relatively fast, but the replenishment of gauze has slowed down significantly this week. This week, the national industrial and commercial inventory decreased by 151,900 tons to 3.1626 million tons, lower than the same period by 37,600 tons; the commercial inventory in Xinjiang decreased to 1.7257 million tons within the month, lower than the same period by 204,600 tons; the commercial inventory in the inland decreased to 768,100 tons this week, lower than the same period by 155,100 tons. At the finished product end, the available days of pure cotton yarn inventory increased by 0.04 days to 31.86 days, the terminal grey cloth inventory increased by 0.28 days to 30.74 days, and the inventory of polyester-cotton yarn in the factory increased by 0.8 days to 28.58 days [16][17] - In June, the import of cotton resources in China did not continue to shrink. In June, China imported about 30,000 tons of cotton, a decrease of about 10,000 tons from the previous month and a year-on-year decrease of about 82.1%; from January to June, China imported about 460,000 tons of cotton, a year-on-year decrease of about 74.3%. According to customs statistics, in June 2025, China's cotton yarn import volume was 110,000 tons, a year-on-year increase of about 0.1% and a month-on-month increase of about 10,000 tons, an increase of about 10%. From January to June 2025, the cumulative import of cotton yarn was 670,000 tons, a year-on-year decrease of 13.6%. In the 2024/25 season (from September 2024 to June 2025), the cumulative import of cotton yarn was about 1.17 million tons, a year-on-year decrease of 18.18% [18][19] - The de-stocking speed of warehouse receipts has accelerated slightly, and the high-sugar warehouse receipts limit the short squeeze. As of July 31, there were 8,940 registered warehouse receipts for Zhengzhou cotton, a decrease of 1,271 within the month, and 348 valid forecasts. The total number of warehouse receipts and forecasts was 9,288, equivalent to 371,500 tons of cotton. Among the warehouse receipts, the cotton resources from Eastern Xinjiang account for a relatively large proportion this year, and the problem of high sugar content in some warehouse receipts continues to limit their outflow under the current tight inventory expectations [20][21] Demand Details - The operating rates of spinning and weaving mills have accelerated their decline, and the losses of textile enterprises have deepened further. This week, the operating rate of spinning mills decreased by 1.9% to 67.6%, lower than the same period by 2.9%; the operating rate of weaving mills decreased by 0.7% to 38.2%, lower than the same period by 1.4%. The year-on-year difference in operating rates has gradually widened compared with the same period last year. The orders of textile enterprises decreased by 0.33 days to 6.94 days, lower than the same period by 2.73 days, and the difference has further expanded compared with last week. From the perspective of spinning profits, the spot profit of the mainstream yarn count within the week dropped to -1,938 yuan/ton, and the expected profit per ton of enterprises in Xinjiang dropped to less than 100 yuan [22][23] - The cotton cloth transactions in the Light Textile City have continued to weaken, and the prices of fabrics and accessories in the Keqiao market have shown a differentiated trend within the week. In the Light Textile City, the latest total transaction volume this week increased by 24,000 meters to 4.892 million meters, and the cotton cloth transaction volume decreased by 30,000 meters to 240,000 meters. In the Keqiao market, the price of accessories increased by 2.17 to 116.44 this week, and the fabric price decreased by 0.19 to 110.66 [24][26] - In June, the export of clothing and textiles decreased slightly year-on-year, and the performance of textiles continued to be weak. In terms of monthly values, the export of textile and clothing in June was $27.31 billion, a slight year-on-year decrease of 0.1%. Among them, the export of textiles was $12.05 billion, a decrease of 1.6% and a month-on-month decrease of 4.6%, and the export of clothing was $15.27 billion, an increase of 1% and a month-on-month increase of 12.4%. In terms of cumulative values, the cumulative export value of textiles and clothing in China reached $143.98 billion, a year-on-year increase of 0.8%. The cumulative export value of textiles in June reached $70.52 billion, a year-on-year increase of 1.8%. The cumulative export of clothing in June reached $73.46 billion, a year-on-year decrease of 0.2%. Overall, the year-on-year export growth rates from April to June were all lower than that of the national goods trade. The main reason for the slowdown in export growth is that the US "reciprocal tariff" policy has had a greater impact on the textile and clothing industry chain. Although the "rush to export" of some enterprises has promoted the growth of clothing export data in May and June, the slowdown in exports to the US from ASEAN and South Asia has led to the drag of textiles on the overall export of clothing and textiles [28][30] - The export to the US has improved slightly, while the exports to ASEAN and the EU have shown a slowdown trend. In June, China's clothing exports to the US reached $3.189 billion, an increase of $607 million from the previous month but lower than the same period by $239 million; China's textile exports to the US reached $4.428 billion, an increase of $973 million from the previous month but lower than the same period by $339 million. China's clothing exports to the EU reached $3.092 billion, an increase of $425 million from the previous month and a year-on-year decrease of $4 million; China's textile exports to the EU reached $4.629 billion, an increase of $461 million from the previous month and a year-on-year decrease of $124 million. China's clothing exports to ASEAN reached $1.12 billion, an increase of $55 million from the previous month and a year-on-year decrease of $252 million; China's textile exports to ASEAN reached $3.788 billion, a decrease of $162 million from the previous month and a year-on-year decrease of $361 million [31][36] - In June, the PMI of the cotton textile industry weakened, and the demand-related indicators continued to weaken. In June, the PMI of the cotton textile industry decreased by 1.95% to 47.71%, remaining below the boom-bust line for three consecutive months. In terms of demand, the PMI of new orders increased by 3.15% to 44.68%, and the PMI of operating rates increased by 1.04% to 52.13%. In terms of inventory and production, the PMI of cotton yarn inventory increased by 12.74% to 63.83%, and the cotton inventory increased by 3.29% to 48.94%. The weakening of demand and the inventory accumulation trend at the terminal continued [37][38] CFTC Position Data - The net short positions of non-commercial and fund investors have rebounded slightly [39]

Report Investment Rating - No investment rating information is provided in the report. Core View - The current decline in cotton prices is beneficial for the outflow of high-premium warehouse receipts, but the expectation of tight supply and demand of cotton at the end of the domestic year remains unchanged, which may still strongly support cotton prices. In the short term, cotton prices may gradually enter a volatile pattern. Attention should be paid to the implementation of domestic import quota policies, the speed of cotton inventory reduction during the off - season, and the adjustment of the China - US trade agreement [4]. Summary by Directory Domestic Market - **Supply**: As of July 24, the national new cotton sales rate was 96.5%, 7.6 percentage points higher than the same period last year and 8.2 percentage points higher than the average of the past four years [1]. - **Import**: In June, China's cotton import volume was 30,000 tons, a decrease of 10,000 tons from the previous month and 130,000 tons from the same period last year; the棉纱 import volume was 110,000 tons, an increase of 10,000 tons from the previous month and the same as the same period last year; the cotton cloth import volume was 4,289.55 tons, a decrease of 3.44% from the previous month and 24.37% from the same period last year [1]. - **Demand**: In June, the domestic retail sales of textile and clothing were 127.54 billion yuan, an increase of 4.08% from the previous month and 3.10% from the same period last year; the export volume of textile and clothing was 27.315 billion US dollars, an increase of 4.22% from the previous month and a decrease of 0.13% from the same period last year [1]. - **Inventory**: As of July 15, the total industrial and commercial inventory of cotton in the country was 3.4245 million tons, a decrease of 308,300 tons from the end of June. Among them, the commercial inventory was 2.5424 million tons, a decrease of 287,400 tons from the end of June, and the industrial inventory was 882,100 tons, a decrease of 20,900 tons from the end of June [1]. International Market US Market - **Supply**: As of July 27, the budding rate of cotton in the United States was 80%, 6% behind the same period last year and 3% behind the average of the past five years; the boll - setting rate was 44%, 8% behind the same period last year and 2% behind the average of the past five years; the overall good - quality rate of cotton plants was 55%, a decrease of 2 percentage points from the previous month and an increase of 6 percentage points from the same period last year [1]. - **Demand**: From July 18 - 24, the net signing of US upland cotton for the 24/25 season was 8,868 tons, significantly higher than the average of the past four weeks; the shipment of upland cotton was 52,367 tons, an increase of 25% from the previous week and 10% from the average of the past four weeks; the net signing of Pima cotton was 23 tons, the shipment of Pima cotton was 1,973 tons, the signing of new - season upland cotton was 16,261 tons, and the signing of new - season Pima cotton was 1,134 tons [1]. Southeast Asian Market - **Supply**: As of July 25, the sown area of new - season cotton in India reached 10.3 million hectares, a decrease of about 2.0% from the same period last year [1]. - **Demand**: In June, Vietnam's textile and clothing export volume was 3.597 billion US dollars, an increase of 9.45% from the previous month and 13.86% from the same period last year; Bangladesh's clothing export volume was 2.788 billion US dollars, a decrease of 28.87% from the previous month and 6.31% from the same period last year; India's clothing export volume was 1.31 billion US dollars, a decrease of 13.30% from the previous month and an increase of 1.23% from the same period last year; Pakistan's textile and clothing export volume was 1.522 billion US dollars, a decrease of 0.60% from the previous month and an increase of 7.59% from the same period last year [1]. Futures Market - **Cotton Futures**: The closing prices of Zhengmian 01, 05, and 09 were 13,785 yuan, 13,730 yuan, and 13,585 yuan respectively, with weekly declines of 330 yuan (-2.34%), 310 yuan (-2.21%), and 585 yuan (-4.13%) [21][24]. - **Spot Market**: The prices of CC Index 3128B, CC Index 2227B, and CC Index 2129B were 15,580 yuan, 13,670 yuan, and 15,873 yuan respectively, with increases of 31 yuan (0.2%), 32 yuan (0.23%), and 7 yuan (0.04%) [24]. - **Spreads**: The CF1 - 5 spread was 65 yuan, a decrease of 10 yuan; the CF5 - 9 spread was 125 yuan, an increase of 295 yuan; the CF9 - 1 spread was - 190 yuan, a decrease of 285 yuan [24]. - **Import Prices**: The price of FC Index M was 13,738 yuan, an increase of 45 yuan (0.33%); the price of FCY Index C32s was 21,230 yuan, an increase of 11 yuan (0.05%) [24]. - **Cotton Yarn**: The closing price of cotton yarn futures was 19,740 yuan, a weekly decline of 630 yuan (-3.09%); the spot price was 20,670 yuan, a decline of 70 yuan (-0.34%) [24].

Core Insights - ICE cotton prices have fallen to a three-week low, raising questions about whether the upcoming USDA export sales report could provide a turnaround for the declining cotton market [1] - The impact of monsoon rains in Pakistan is being monitored, as it may lead to new supply challenges in the cotton market [1] Group 1 - ICE cotton prices have reached a three-week low, indicating a bearish trend in the market [1] - The USDA export net sales report scheduled for Thursday is anticipated to influence cotton prices, potentially reversing the current downward trend [1] - The situation in Pakistan, particularly the monsoon rains, could create additional supply issues for the cotton industry [1]

Core Viewpoint - Recent rebound in cotton prices is primarily influenced by substantial progress in high-level economic talks between China and the U.S., although macroeconomic uncertainties and favorable weather conditions for the new crop year may limit the extent of price increases [1][2][3] Group 1: Economic Factors - The high-level economic talks on May 10-11 resulted in significant tariff reductions, boosting market sentiment and leading to a rebound in cotton prices [1] - G7 finance ministers discussed imposing tariffs on small packages from China, with China's apparel exports to G7 countries (excluding the U.S.) accounting for 19.2% of total exports, which could significantly impact cotton demand [1][2] Group 2: Market Demand - Downstream enterprises reported a surge in shipments to the U.S. following the tariff reductions, but the overall demand remains weak due to several factors, including previous stockpiling and the cancellation of the small package tax exemption [2] - The 24% tariff suspension is temporary (90 days), creating uncertainty in global trade dynamics, which makes enterprises cautious about new orders [2] Group 3: Production Outlook - New cotton planting is nearly complete, with initial weather conditions being favorable, leading to optimistic expectations for increased production in Xinjiang [2] - The cotton production in Xinjiang is projected to reach a ten-year high, which may exert strong upward pressure on prices and limit the current rebound [2][3]

Report Industry Investment Rating No relevant information provided. Core Viewpoints of the Report - International cotton market: ICE cotton prices are under pressure to rebound. The market is still worried about demand, paying attention to the impact of the USDA May supply - demand report. Although the cotton planting progress in the US is accelerating and the drought has eased to some extent, the planting area has decreased, and future weather impacts on cotton production need to be monitored [7]. - Domestic cotton market: Domestic cotton spot prices are mainly falling. The de - stocking of downstream yarn has slowed down, and textile enterprises have insufficient motivation to purchase cotton. External demand and export demand suppress cotton prices. Technically, Zhengzhou cotton is in a weak and volatile state [7]. - Basis: The basis is expected to weaken [7]. - Spread between near and far months: The spread between near and far months is oscillating and weakening [7]. - Unilateral: It shows a low - level oscillating trend, and there is still downward pressure in the medium - term [7]. Summary According to Related Catalogs Market Overview - Price changes: The futures closing price of NYBOT No. 2 cotton decreased by 2.40% to 66.72; the International Cotton Index M increased by 0.27% to 75.1; the China Cotton Price Index CCIndex 3128B increased by 6.63% to 13,595; some other related price indices showed different degrees of increase or decrease. The overall trend of the international cotton market is still in a low - level oscillation, fluctuating around trade tariff events, and the market is waiting for the USDA May supply - demand report [4]. - Supply - demand factors: Globally, cotton production is expected to decline by 0.06% to 26.354 million tons, inventory is expected to increase by 0.68% to 17.1915 million tons, and the inventory - to - consumption ratio is expected to increase by 1.12% to 67.97%. In the US, weekly net cotton export sales decreased by 39.31% to 1.43 million tons. In China, production is expected to be stable, commercial inventory decreased by 14.20% to 4.1526 million tons, imports decreased by 41.67% to 7 million tons, downstream开工 decreased by 2.80% to 68%, and textile export value increased by 222.8687% to 2.418622 million US dollars [6]. Spot Market Price and Spread - Price trends: Presented the price trends of international cotton index, Chinese yarn price index, and Chinese cotton price index over a certain period [11][12][13]. - Basis: The cotton basis decreased by 18.21% to 1,172, and the yarn basis decreased by 33.33% to 1,080. Both are expected to weaken [4]. - Internal - external spread: Showed the import cotton price, internal - external cotton price spread, import yarn price, and internal - external yarn price spread [17]. International Cotton Market Supply - Demand Data - Presented the global cotton production, consumption, inventory, and inventory - to - consumption ratio over the years, as well as the US cotton export signing volume, shipment rate, and cumulative export volume [20][21]. Domestic Cotton Market Supply - Demand and Industrial Data - Production and demand: Showed the production and demand of Chinese cotton over the years, as well as the end - of - period inventory [23][24]. - Commercial inventory: Domestic cotton commercial inventory is in a de - stocking state, and presented the weekly and monthly values of commercial inventory [27][28]. - Import situation: Showed the annual and monthly import volumes of Chinese cotton [30]. - Spinning mill inventory and enterprise operation: Presented the inventory days of cotton and yarn in spinning mills, the starting rate of domestic textile enterprises, cotton textile profit, and the spread between Zhengzhou cotton yarn and Zhengzhou cotton [31][33][34]. - Yarn and textile imports and exports: Showed the monthly import volume of yarn and the monthly export value of textile yarns and clothing [37][38]. Exchange Rate Trends - Presented the trends of the US dollar index and the US dollar - to - RMB exchange rate [41][42].