1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints of the Report - The cotton market is overall neutral, but the outlook for Zheng cotton is bullish after the holiday. The expected reduction in the cotton planting area in Xinjiang in 2026 by over 10% is a positive factor. Although there are negative factors such as a decline in overall foreign trade orders and an increase in inventory, the pre - holiday high - level consolidation of Zheng cotton and the rebound of US cotton during the Spring Festival suggest that Zheng cotton is likely to rise after the holiday, maintaining a bullish and volatile trend [4][5][6]. 3. Summary by Relevant Catalogs 3.1 Previous Day's Review - Not provided in the content 3.2 Daily Tips - **Fundamentals**: In 2026, the cotton planting area in Xinjiang is expected to be regulated with a possible reduction of over 10%. According to the USDA February report, the 2025/26 annual output is 2609.6 million tons, consumption is 2584.7 million tons, and the ending inventory is 1635.3 million tons. In December, textile and clothing exports were $25.99 billion, a year - on - year decrease of 7.4%. In December, China imported 180,000 tons of cotton, a year - on - year increase of 31%, and 170,000 tons of cotton yarn, a year - on - year increase of 13.33%. According to the February forecast of the Ministry of Agriculture for the 2025/26 season, the output is 6.64 million tons, imports are 1.4 million tons, consumption is 7.6 million tons, and the ending inventory is 8.29 million tons [4]. - **Basis**: The national average price of spot 3128b is 16,119, and the basis is 1379 (for the 05 contract), with a premium over futures, indicating a bullish signal [4]. - **Inventory**: The February 2025/26 forecast of the ending inventory by the Chinese Ministry of Agriculture is 8.29 million tons, which is a bearish factor [4]. - **Market Chart**: The 20 - day moving average is flat, and the K - line is above the 20 - day moving average, showing a bullish sign [4]. - **Main Position Holdings**: The positions are bullish, but the net long positions are decreasing, and the main trend is unclear, still showing a bullish tendency [4]. - **Expectations**: During the Spring Festival, US cotton rebounded from the bottom to around 66 cents. Zheng cotton was relatively strong compared to the external market before the holiday, and the holiday rise in the external market will have little impact on Zheng cotton. Zheng cotton is likely to rise after the holiday, maintaining a bullish and volatile trend [4]. 3.3 Today's Focus - Not provided in the content 3.4 Fundamental Data - **USDA Global Cotton Supply - Demand Forecast**: In 2025/26, the global cotton output is 2609.6 million tons, consumption is 2584.7 million tons, imports are 951.6 million tons, exports are 951.7 million tons, and the ending inventory is 1635.3 million tons. There are differences in production, consumption, import, export, and inventory changes in different countries [11][12]. - **ICAC Global Cotton Supply - Demand Forecast (November 2025)**: The area is 3041.385 million hectares, the yield per unit is 835.13 kg/ha, the output is 2539.956 million tons, the beginning inventory is 1583.577 million tons, imports are 971.442 million tons, consumption is 2500.778 million tons, exports are 971.412 million tons, the ending inventory is 1622.785 million tons, and the inventory - to - consumption ratio is 0.65 [14]. - **Domestic Cotton Supply - Demand Data**: According to the Ministry of Agriculture, for the 2025/26 season, the sown area is 29.79 million hectares, the yield per unit is 2229 kg/ha, the output is 6.64 million tons, imports are 1.4 million tons, consumption is 7.6 million tons, and the ending inventory is 8.29 million tons. The domestic average price of cotton 3128B is expected to be between 14,000 - 16,000 yuan/ton, and the Cotlook A index is expected to be between 75 - 100 cents/pound [16]. 3.5 Position Data - Not provided in the content

1. Report Industry Investment Rating - No information provided in the report 2. Core Viewpoints of the Report - The cotton market is currently in a neutral state. The main cotton contract 05 is expected to move sideways around 14,500, with strong support near this level in the short term. As the Spring Festival holiday approaches, it is recommended to reduce positions to avoid risks before the festival, and adopt an intraday short - term trading strategy with a slightly bullish bias [4][5]. 3. Summary According to the Table of Contents 3.1 Previous Day's Review - No information provided in the report 3.2 Daily Tips - The cotton market has both positive and negative factors. Positive factors include the expected reduction of over 10% in the cotton planting area in Xinjiang in 2026, downstream restocking before the Spring Festival, 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 large - scale listing of new cotton, and the current traditional off - season for consumption [7][8]. 3.3 Today's Focus - **Fundamental Data** - In 2026, the cotton planting area in Xinjiang is expected to be regulated, with a possible reduction of over 10%. According to the USDA's December report, the global cotton 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 December, China's textile and clothing exports were $25.99 billion, a year - on - year decrease of 7.4%. China imported 180,000 tons of cotton in December, a year - on - year increase of 31%, and 170,000 tons of cotton yarn, a year - on - year increase of 13.33%. According to the Ministry of Agriculture's December forecast for the 2025/2026 season, China's cotton 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 [4]. - The basis of cotton: The national average price of spot 3128b is 15,988, and the basis for the 05 contract is 1,333, showing a premium over the futures, which is a bullish signal [6]. - Inventory: The Ministry of Agriculture's December forecast for the 2025/2026 season shows an ending inventory of 8.35 million tons, which is a bearish factor [6]. - The 20 - day moving average of the cotton price is flat, and the K - line is near the 20 - day moving average, indicating a neutral situation [6]. - The main positions are bullish, with an increase in net long positions, but the main trend is not clear, which is a bullish signal [6]. - **Position Data** - No information provided in the report

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.

Report Industry Investment Rating No information provided in the report. Core Views - The cotton market is currently influenced by both positive and negative factors. In the short - term, the main 05 contract is expected to maintain a volatile upward trend, with a possibility of回调 after continuous rapid surges [4][5]. - Positive factors include potential reduction in Xinjiang cotton planting area by over 10% in 2026, a 10% reduction in export tariffs to the US, increased export volume, enhanced replenishment willingness of downstream enterprises, and favorable factors such as basis and market trends [4][5][6]. - Negative factors are the overall decline in foreign trade orders, increased inventory, large - scale listing of new cotton, and the traditional off - season for consumption [8]. Summary by Directory 1. Previous Day Review No information provided in the report. 2. Daily Tips - **Fundamentals**: In 2026, the planting area of Xinjiang cotton is expected to be reduced by over 10%. According to the USDA December report, the 2025/2026 production 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%. Cotton imports in November were 120,000 tons, a year - on - year increase of 9.4%; yarn imports were 150,000 tons, 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. Overall, it is bullish [4]. - **Basis**: The national average price of spot 3128b is 15,711, and the basis for the 05 contract is 856, indicating that the spot price is at a premium to the futures price, which is bullish [6]. - **Inventory**: The Ministry of Agriculture's December 2025/2026 forecast of China's ending inventory is 8.35 million tons, which is bearish [6]. - **Market**: The 20 - day moving average is upward, and the K - line is above the 20 - day moving average, which is bullish [6]. - **Main Position**: The net long position is increasing, and the main trend is bullish [6]. - **Expectation**: The main factors for the current rebound are a 10% reduction in export tariffs to the US, increased export volume, enhanced replenishment willingness of downstream enterprises due to rising cotton prices, and significant reduction in Xinjiang cotton planting area in the new year. The short - term bullish factors for the main 05 contract remain unchanged, and it will continue to fluctuate upward, with a higher probability of回调 after continuous rapid surges [5]. 3. Today's Focus No information provided in the report. 4. Fundamental Data - **USDA Global Forecast**: In December, the global cotton production in 2025/2026 is 26.081 million tons, consumption is 25.823 million tons, imports are 9.522 million tons, exports are 9.524 million tons, and the ending inventory is 16.541 million tons [11][12]. - **ICAC Forecast**: In November 2025, the global cotton production in 2025/2026 is 25.39956 million tons, consumption is 9.71442 million tons, and the ending inventory is 16.22785 million tons [14]. - **Ministry of Agriculture Data**: In 2025/2026, 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 [4]. 5. Position Data No information provided in the report.

Group 1: Report Industry Investment Rating - There is no information about the report industry investment rating in the provided content. Group 2: Core Viewpoints of the Report - The overall view on cotton is that the short - term bullish factors for the main 05 contract remain unchanged, and it will continue the volatile upward trend with possible fluctuations like "three steps forward, two steps back". The bullish factors include the expected reduction of over 10% in Xinjiang cotton planting area in 2026, a 10% reduction in export tariffs to the US, increased downstream replenishment due to rising cotton prices, and positive indicators such as the 20 - day moving average trend, k - line position, and main force's long - position trend. However, there are also bearish factors such as a decline in overall foreign trade orders, increased inventory, a large number of new cotton listings, and the current traditional off - season for consumption [4][5][6]. Group 3: Summary According to the Table of Contents 1. Previous Day's Review - There is no information about the previous day's review in the provided content. 2. Daily Tips - **Fundamentals**: In 2026, the Xinjiang cotton planting area is expected to be reduced by over 10%. Different reports have different data on cotton production and consumption. For example, the ICAC 11 - month report shows a 2025/2026 production of 2540 tons and consumption of 2500 tons, while the USDA 11 - month report shows a production of 2614.5 tons and consumption of 2588.3 tons. In November, textile and clothing exports were 23.869 billion US dollars, a year - on - year decrease of 5.12%. Cotton imports in November were 120,000 tons, a year - on - year increase of 9.4%, and cotton yarn imports were 150,000 tons, a year - on - year increase of 25%. The Ministry of Agriculture's December 2025/2026 data shows a production 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. Overall, the fundamentals are considered bullish [4]. - **Basis**: The national average price of spot 3128b is 15,615, and the basis for the 05 contract is 960, indicating a premium over futures, which is bullish [4]. - **Inventory**: The Ministry of Agriculture's December 2025/2026 forecast for China's ending inventory is 8.35 million tons, which is bearish [4]. - **Disk**: The 20 - day moving average is upward, and the k - line is above the 20 - day moving average, which is bullish [4]. - **Main Force Position**: The position is bullish, with an increase in net long positions, and the main force's trend is bullish [4]. - **Expectations**: The factors driving this round of rebound include a 10% reduction in export tariffs to the US, a month - on - month increase in exports, an increase in downstream enterprises' willingness to replenish stocks due to rising cotton prices, and significant policy - regulated reduction in Xinjiang cotton planting area in the new year [4]. 3. Today's Focus - There is no information about today's focus in the provided content. 4. Fundamental Data - **USDA Global Cotton Supply - Demand Data**: In 2025/2026, 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 [9][10]. - **ICAC Global Cotton Supply - Demand Data**: In 2025/2026, the area is 30.41385 million hectares, the yield per unit is 835.13 kg/ha, the production is 25.39956 million tons, the beginning 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 [12]. - **Ministry of Agriculture's Cotton Supply - Demand Data**: In 2025/2026, the beginning inventory is 9.853 million tons, 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 [14]. 5. Position Data - There is no information about position data in the provided content.

Sugar Market Overview - Raw sugar prices in December fluctuated between 14.3 and 15.3 cents per pound. As of December 15, 2025, India's sugar production for the 2025/26 season reached 7.825 million tons, an increase of 1.697 million tons or 27.69% year-on-year. The number of sugar mills in operation was 478, slightly up from 477 the previous year [2][11] - Thailand's cumulative sugarcane crushing volume as of December 27 was 14.0733 million tons, down by 2.8243 million tons or 16.71% year-on-year. The sugar content in sugarcane was 11.44%, a decrease of 0.07% from the previous year, while the sugar extraction rate increased to 9.09%, up by 0.095% year-on-year. The total sugar production was 1.2793 million tons, down by 240.6 thousand tons or 15.83% year-on-year [2][11] Domestic Market Insights - In December, the new sugar prices from Guangxi Sugar Group ranged from 5,310 to 5,410 yuan per ton, a decrease of approximately 150 yuan per ton. Yunnan Sugar Group's new sugar prices were between 5,140 and 5,240 yuan per ton, also down by about 150 yuan per ton. The main processing sugar factory prices ranged from 5,780 to 5,900 yuan per ton [3][12] - In November 2025, China imported 440 thousand tons of sugar, a decrease of 93.4 thousand tons year-on-year. From January to November 2025, sugar imports totaled 4.3416 million tons, an increase of 376.4 thousand tons or 9.49% year-on-year. For the 2025/26 season, sugar imports reached 1.1862 million tons, up by 115.9 thousand tons or 10.83% year-on-year [3][13] Market Sentiment and Future Outlook - The current market remains relatively calm, with no new updates from Brazil. The production progress in the Northern Hemisphere is the main focus, with India's production significantly ahead year-on-year. However, raw sugar prices have not yet reached levels that would allow India to export, indicating that production issues are more of an emotional restraint rather than an actual increase in trade flows. Future attention will be on India's latest production estimates [4][14] - The domestic sugar market experienced a decline in prices due to optimistic production expectations, leading to a recovery after an oversold situation. January is expected to see continued high production levels, but with ample supply, further price increases may face challenges. The market is expected to stabilize around 5,300 yuan per ton, with a focus on inventory accumulation before the upcoming holiday [4][14]

Sugar Industry - As of December 15, India has 479 sugar mills operating for the 2025/26 crushing season, an increase of 6 mills year-on-year [2] - Sugar production in India is 7.79 million tons, which is an increase of 1.72 million tons or 28.34% year-on-year [2] - Domestic spot prices for new sugar in Guangxi are quoted at 5340-5440 CNY/ton, down by 10 CNY/ton, while Yunnan's new sugar is priced at 5210-5320 CNY/ton, also down by 10 CNY/ton [2] - The market is experiencing general concerns due to the recent influx of new sugar, leading to a slight decline in domestic spot prices [2] Cotton Industry - On Monday, ICE cotton rose by 0.16% to 63.93 cents per pound, while CF601 increased by 1.08% to 14,000 CNY/ton [3] - The main contract's open interest decreased by 50,374 contracts to 347,100 contracts [3] - The cotton 3128B spot price index is at 14,690 CNY/ton, up by 60 CNY/ton from the previous day [3] - The market is awaiting U.S. economic data, with fluctuations in the dollar index impacting sentiment [3] - Recent updates on U.S. cotton exports show relatively good performance, providing some support for cotton prices [3] - There are discussions regarding the regulation of cotton planting areas for the new year, with expectations for an official report [3][8] - The cotton market is characterized by mixed factors, with support from demand and policy, while facing pressure from high production levels and potential hedging pressures [8]