1. Report Industry Investment Rating - No relevant information provided 2. Core View of the Report - In the domestic market, the supply pressure has increased as a large amount of cotton has arrived at ports, leading to a significant increase in port inventory. As of March 5th, the inventory at major ports for imported cotton was 556,500 tons, a 3.42% increase from the previous period. On the consumption side, downstream consumption is gradually recovering. The market is mainly focused on fulfilling previous orders, with limited new orders. The inventory of finished products has relatively decreased, and the pressure is limited. Given that the current market is in the traditional peak consumption season of "Golden March and Silver April", it is expected that the upward trend of cotton prices will remain unchanged in the short term [2] 3. Summary by Related Catalogs Futures Market - The closing price of the main Zhengzhou cotton futures contract was 15,320 yuan/ton, up 35 yuan; the closing price of the main cotton yarn futures contract was 21,280 yuan/ton, unchanged. - The net position of the top 20 in cotton futures was -204,862 hands, an increase of 11,395 hands; the net position of the top 20 in cotton yarn futures was -1,391 hands, an increase of 108 hands. - The position volume of the main cotton futures contract was 721,678 hands, a decrease of 27,883 hands; the position volume of the main cotton yarn futures contract was 14,083 hands, a decrease of 435 hands. - The number of cotton warehouse receipts was 11,950, an increase of 303; the number of cotton yarn warehouse receipts was 43, unchanged [2] Spot Market - The China Cotton Price Index (CCIndex:3128B) was 16,733 yuan/ton, up 101 yuan; the China Yarn Price Index for pure - combed cotton yarn of 32 - count was 22,000 yuan/ton, up 40 yuan. - The arrival price of imported cotton yarn price index for pure - combed cotton yarn of 32 - count was 22,033 yuan/ton, up 158 yuan; the arrival price of imported cotton yarn price index for pure - combed cotton yarn of 32 - count was 23,525 yuan/ton, up 74 yuan [2] Upstream Situation - The national cotton sowing area was 2,838.3 thousand hectares, an increase of 48.3 thousand hectares; the national cotton output was 6.16 million tons, an increase of 540,000 tons [2] Industry Situation - The cotton - yarn price difference was 5,267 yuan/ton, a decrease of 61 yuan. - The industrial inventory of cotton nationwide was 861,000 tons, an increase of 13,000 tons. - The monthly import volume of cotton was 180,000 tons, an increase of 60,000 tons; the monthly import volume of cotton yarn was 170,000 tons, an increase of 20,000 tons. - The profit from importing cotton was 3,038 yuan/ton, an increase of 63 yuan; the commercial inventory of cotton nationwide was 5.7887 million tons, an increase of 4,000 tons [2] Downstream Situation - The inventory days of yarn were 21.71 days, a decrease of 3.41 days; the inventory days of grey cloth were 33.13 days, a decrease of 0.63 days. - The monthly output of cloth was 3.01 billion meters, an increase of 200 million meters; the monthly output of yarn was 2.132 million tons, an increase of 93,000 tons. - The monthly export value of clothing and clothing accessories was 134,124,120,000 US dollars, an increase of 18,187,260,000 US dollars; the monthly export value of textile yarns, fabrics and products was 125,796,030,000 US dollars, an increase of 30,387,000 US dollars [2] Option Market - The implied volatility of at - the - money call options for cotton was 21.03%, an increase of 2.61%; the implied volatility of at - the - money put options for cotton was 21.07%, an increase of 2.65%. - The 20 - day historical volatility of cotton was 14.68%, a decrease of 1.36%; the 60 - day historical volatility of cotton was 13.76%, unchanged [2] Industry News - According to data from the US Commodity Futures Trading Commission, as of March 3, 2026, the non - commercial long positions in US cotton were 112,260 hands, an increase of 8,836 hands from the previous week; the non - commercial short positions were 140,357 hands, an increase of 7,963 hands from the previous week; the net short positions were 28,097 hands, a decrease of 873 hands from the previous week. - ICE cotton futures rose on Monday, supported by bargain - hunting after last week's price drop. Traders are closely monitoring the tense situation in the Middle East. The ICE May cotton futures contract closed up 0.42 cents, or 0.65%, at 64.62 cents per pound [2]

1. Report Industry Investment Rating - Not provided in the report 2. Core Viewpoints of the Report - In 2025, Zhengzhou cotton futures prices fluctuated within a wide range of 12,400 - 14,300 yuan/ton, driven by both macro - policies and industrial supply - demand. ICE U.S. cotton futures prices trended downward. In 2026, U.S. cotton prices may show a "first - depressed, then - stable" wide - range oscillation pattern, while Zhengzhou cotton may have a "first - depressed, then - rising" trend [2][3][5] 3. Summary According to Relevant Contents 3.1 Historical Market Review - Since its listing in 2004, cotton futures prices have experienced nine major periods of significant fluctuations affected by national policies, international trade, and supply - demand changes in the industrial chain [13] - In 2025, Zhengzhou cotton futures prices fluctuated in the range of 12,400 - 14,300 yuan/ton, with six main stages throughout the year. ICE U.S. cotton futures prices trended downward overall, with a slight rebound at the end of October [23][24][32] 3.2 Cotton and Cotton Yarn Futures Trading and Position - holding - In 2025, the position - holding volume of domestic cotton futures increased significantly. By December 11, the total position - holding volume reached 1,138,013 lots, with an annual average of 816,094.60 lots. As of October 7, the non - commercial net long positions in ICE cotton futures decreased [37][38] 3.3 Global Cotton Supply - Demand - In the 2025/26 season, the global cotton production increased by 92,000 tons to 26.096 million tons, consumption decreased by 44,000 tons to 25.847 million tons, and the ending inventory increased by 136,000 tons to 16.353 million tons [41] - In the U.S., the 2025/26 cotton production is expected to be 3.03 million tons, with a decrease in export volume and an increase in ending inventory. Brazil's cotton production reached a record high in 2025, with exports continuing to grow strongly. India's cotton market in 2025 showed a pattern of "declining production, surging imports, weak consumption, and rising inventory" [49][68][88] 3.4 Domestic Cotton Supply - Demand - In 2025, China's cotton planting area increased, with Xinjiang's output expected to exceed 7 million tons. The cost of new cotton is fixed, and cotton farmers' income depends on national subsidies [97][107] - In 2025, China's imported cotton volume decreased significantly, with Brazilian cotton becoming the main source. The profits of textile enterprises were polarized, and the domestic textile terminal's domestic and foreign demands were slightly differentiated [118][133][136] 3.5 Outlook for the Cotton Market in 2026 - Abroad, in the short - term, U.S. cotton futures prices are under pressure, and may fall to 60.64 cents/pound by the end of the quarter. In the long - term, prices are expected to stabilize gradually, showing a "first - depressed, then - stable" wide - range oscillation pattern [147] - Domestically, Zhengzhou cotton may show a "first - depressed, then - rising" trend throughout the year. The core operating range may be between 14,500 - 17,000 yuan/ton [153] 3.6 Seasonal Analysis - From the seasonal chart of the cotton futures index, April and December are more likely to see rising cotton prices, while February and May are more likely to see falling prices [157] 3.7 Cotton Options Market Analysis and Operation Strategies - For cotton spot traders, it is recommended to use a combined options strategy for hedging: sell CF2605 - C - 14800, buy CF2605 - C - 13500, and sell CF2605 - P - 13200 [162] 3.8 Appendix - Related Stocks in the Cotton Industry - The report lists the stock codes, names, related products, initial prices, current prices, and annual price changes of upstream, middle - stream, and downstream companies in the cotton industry [164]

1. Report Industry Investment Rating No information provided in the report. 2. Core View of the Report - The supply side will face selling and hedging pressure as new cotton is expected to be in large supply in November. Although this year's cotton production is a bumper harvest, the expected increase may be less than previously thought. The demand side is entering a relatively off - season after the peak season, with average recent orders. Considering these factors, Zhengzhou cotton is likely to fluctuate, with limited upside and downside potential. Additionally, Sino - US trade negotiations and the expiration of the Sino - US tariff agreement in November may have a significant impact on the market [5]. - It is expected that the future trend of US cotton will mostly be in a sideways pattern, while Zhengzhou cotton is expected to show a slightly stronger sideways movement. Existing long positions should take profits [6]. 3. Summary by Directory First Part: Market Information - **Futures Market**: For cotton futures, the closing prices of CF01, CF05, and CF09 contracts decreased by 10, 5, and 5 respectively. Their trading volumes decreased by 86089, 45399, and 14 respectively, and open interest changed by - 1553, + 4162, and - 12 respectively. For棉纱 futures, the closing prices of CY01, CY05, and CY09 contracts increased by 50, 40, and 145 respectively. Their trading volumes changed by + 125, + 9, and - 2 respectively, and open interest changed by + 19, + 1, and - 1 respectively [2]. - **Spot Market**: The price of CCIndex3128B decreased by 21 to 14820 yuan/ton, and the price of CY IndexC32S remained unchanged at 20520 yuan/ton. Other spot prices such as Cot A, FCY IndexC33S, etc., also had corresponding changes [2]. - **Spread**: Cotton and棉纱 cross - period spreads and cross - variety spreads all had different degrees of change. For example, the 1 - 5 month spread of cotton was - 10 with a decrease of 5, and the CY01 - CF01 spread was 6265 with an increase of 60 [2]. Second Part: Market News and Views - **Cotton Market News**: As of November 3, 2025, the cotton picking progress in Xinjiang was about 96.1%, with different progress in southern, northern, and eastern Xinjiang. The out - of - Xinjiang cotton road transport price index on November 6, 2025, remained unchanged at 0.1827 yuan/ton·km, and it is expected to fluctuate upward in the short term. As of October 31, 1006 cotton processing enterprises across the country had conducted notarized inspections, with a total inspection weight of 178.4 million tons [4]. - **Trading Logic**: The supply side has new cotton coming onto the market in large quantities, with a large increase in production this year but a possible smaller increase than expected. The demand side is in a relatively off - season, and previous negative factors have been reflected in the price. Zhengzhou cotton is expected to fluctuate mainly, and Sino - US trade policies need attention [5]. - **Trading Strategy**: - **Single - sided**: It is expected that US cotton will mostly fluctuate, and Zhengzhou cotton will fluctuate slightly stronger. Existing long positions should take profits [6]. - **Arbitrage**: Hold a wait - and - see attitude [7]. - **Options**: Hold a wait - and - see attitude [7]. - **Cotton Yarn Industry News**: Affected by the good news of Sino - US tariff reduction, Zhengzhou cotton rebounded slightly, but the overall trading volume did not change much. Different varieties of cotton yarn showed different trends, with the overall inventory increasing. The spot market for all - cotton grey cloth had low production and sales, and enterprises generally reported a lack of large orders [8]. Third Part: Options - **Volatility**: On the previous day, the 120 - day HV of cotton was 7.2333, with a slight decrease in volatility. The implied volatilities of CF601 - C - 13400, CF601 - P - 13000, and CF601 - P - 12400 were 7.7%, 10.5%, and 15.1% respectively [10]. - **Volume Ratio**: The previous day, the PCR of the main contract of Zhengzhou cotton was 0.7324, and the PCR of trading volume was 0.5889. The trading volumes of both call and put options decreased today [11]. - **Option Strategy**: Hold a wait - and - see attitude [12].