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 Summary 1. Market Review - The main cotton futures contract closed with a small negative line this week. The closing price was 14,170 yuan per ton, down 100 points from last week's close [1] 2. News - The improvement of US unemployment data may affect the interest - rate cut policy. Brazilian association data shows a 7% year - on - year increase in cotton production, and consumption is on par with the average of the past five years. In China, high temperatures in Xinjiang this week have affected cotton growth [2] 3. Fundamentals - In terms of supply, it is generally tight. Port inventories are at a 20 - month low, and domestic cotton destocking was evident this week. On the demand side, downstream textile mills are in the off - season, with a declining operating rate. Enterprises are replenishing inventory normally. Cotton inventory decreased by 267 lots this week, and the basis rate is around 8.53% [3] 4. Global Supply and Demand Forecast - The USDA's global cotton supply - demand forecast monthly report shows that in the 2024/25 season, global production, consumption, trade volume, and beginning and ending inventories have all been revised down [5]

1. Report Industry Investment Rating - The report gives a "sideways" rating for cotton [1] 2. Core Views of the Report - The international cotton market is expected to maintain a low - level sideways pattern in the second half of the year, with an estimated operating range of 65 - 80 cents per pound. The domestic cotton market is also expected to have a low - level sideways pattern, with an estimated range of 12,500 - 14,500 yuan per ton. Attention should be paid to factors such as weather, trade policies, and macro - dynamics [2][3] - For investment strategies, it is recommended to focus on short - term opportunities to short the January contract on rallies and conduct band trading within the estimated range. Also, pay attention to potential reverse arbitrage opportunities between November and January contracts [4] 3. Summary According to Relevant Catalogs 3.1. First Half of the Year: Trade Wars Intensified Cotton Market Fluctuations - In the first quarter, the external market was weakly sideways with a downward shift in the center, while the domestic market was range - bound and relatively resilient. The international market faced a more relaxed supply - demand situation, and the trade war cast a shadow over demand. The ICE cotton price fluctuated weakly around the cost of US cotton, with an operating range of 63 - 69 cents per pound. The domestic market had support from low raw material inventories in downstream spinning enterprises and low social inventories of cotton yarn, but was also constrained by unhedged and unpriced resources of ginning factories and concerns about demand due to the trade war. The Zhengzhou cotton futures fluctuated in the range of 13,300 - 13,900 yuan per ton [16] - In the second quarter, trade policy changes led to intensified fluctuations in both the external and domestic markets. The external market was relatively stable, while the domestic market was more volatile. The price difference between the domestic and international markets first narrowed and then widened. Overall, the domestic market was stronger than the external market [17][18][19] 3.2. International Cotton Fundamental Situation 3.2.1. United States - The USDA may have limited room to further lower the production estimate for the 2025/26 US cotton season. The actual sown area may be lower than the intended area, and the abandonment rate is expected to be between 10% - 20%. The estimated production range is 2.9 - 3.265 million tons [22][23][25] - The export target for the 2024/25 US cotton season has been basically achieved, but the export contract signing for the 2025/26 season has been slow. As of June 12, the cumulative export contract volume for the 2025/26 season was 378,000 tons, a 15% year - on - year decrease [37][38] - The inventory - to - use ratio of US cotton in the 2025/26 season is expected to decline year - on - year but remain at a moderately high historical level. The estimated inventory - to - use ratio is between 29.3% - 30.8%, and the ICE cotton price is expected to fluctuate in the range of 65 - 85 cents per pound [53] 3.2.2. India - The monsoon rainfall is expected to be abundant, and there is a possibility of an increase in the planting area and production. The USDA's estimates of India's cotton planting area and production may be underestimated [60][62] - The net import volume of Indian cotton in the 2025/26 season may continue to increase. Attention should be paid to the US - India trade negotiations and the inventory digestion progress of the Cotton Corporation of India (CCI) [68] 3.2.3. Brazil - Brazil's cotton production in 2025 is expected to reach a record high. The Conab has continuously raised its production estimate, and the latest estimate is 3.915 million tons, a 6.5% year - on - year increase [76] 3.2.4. Global - The global supply - demand pattern in the 2025/26 season is not expected to be tight. The USDA's subsequent estimates of global supply and demand may be adjusted to a more relaxed direction. The estimated global cotton production may be revised upwards by 400,000 - 600,000 tons or more, and the consumption may remain stable or slightly decline [84][87][89] 3.2.5. International Cotton Market Fundamental Summary and Market Outlook - It is expected that the cotton market will maintain a low - level sideways pattern in the second half of the year, with an estimated operating range of 65 - 80 cents per pound. Attention should be paid to factors such as weather, trade policies, and macro - dynamics [98] 3.3. Domestic Cotton Fundamental Situation 3.3.1. The Planting Area of Xinjiang Cotton has Expanded in the 2025/26 Season - The planting area of Xinjiang cotton has expanded due to planting structure adjustment and the reclamation of new land. The estimated increase in the national cotton planting area is between 1.7% - 3.3% [105] 3.3.2. Ginning Factories may Remain Rational in New Cotton Purchases - Ginning factories are expected to purchase new cotton rationally. The initial purchase price of seed cotton is expected to be flat or slightly lower year - on - year and then fluctuate weakly. The purchase price of cottonseed is expected to be higher than that of last year [110][111][112] 3.3.3. Commercial Inventory of Old Cotton has been Reduced Rapidly - The commercial inventory of old cotton has been reduced rapidly, which has led to concerns about a potential shortage during the transition between the old and new cotton seasons [3] 3.3.4. Registered Warehouse Receipts - Attention should be paid to the outflow of warehouse receipts in inland warehouses. If the warehouse receipts cannot be digested, there may still be reverse arbitrage opportunities between November and January contracts [4] 3.3.5. Import Volume of Cotton and Cotton Yarn has Decreased - The import volume of cotton and cotton yarn in the 2024/25 season has decreased [3] 3.3.6. Trade Wars and Textile Demand - Trade wars and the uncertain trade policies have cast a shadow over the demand for cotton. The downstream textile industry is in a slack season, and the demand in the second half of the year may be weaker than that of last year [2][3] 3.3.7. Domestic Supply - Demand Balance Sheet - The supply - demand situation in the 2024/25 season was tight, while the 2025/26 season may be a year of easy inventory accumulation [3]

Group 1: Report Industry Investment Rating - Not provided in the content Group 2: Core Viewpoints of the Report - The short - term trend of US cotton is expected to remain the same, while Zhengzhou cotton is expected to be weak in the short - term and continue to decline in the medium - to - long - term. Traders can consider shorting on rallies in the short - term [7][12][21] Group 3: Summary by Relevant Catalogs International Market Analysis - **US Cotton Market**: Uncertain weather may affect growth, and increased purchases from countries like Vietnam may have a positive impact. Short - term trend is expected to remain the same [7] - **US Cotton Growth**: As of May 4, the planting rate was 21%, 2% slower than last year and 1 percentage point faster than the five - year average. The main producing areas are still dry [7] - **US Cotton Sales**: As of the week of May 1, 2024/25 US upland cotton weekly signing decreased, 2025/26 cumulative signing declined, and 2024/25 weekly shipment increased. Pima cotton signing and shipment also increased [7] - **CFTC Position**: As of May 2, the number of unpriced contracts of sellers on the ON - CALL 2507 contract decreased, and the total number of unpriced contracts of 24/25 sellers decreased, while the total number of ICE unpriced contracts increased [7] - **Other Countries**: Brazil's Mato Grosso state is expected to have a slight increase in seed cotton production. India's weekly cotton listing volume decreased year - on - year, and the cumulative listing volume accounted for 91% of the predicted output [7] Domestic Market Logic Analysis - **Domestic Market**: Zhengzhou cotton fluctuated this week. After the release of macro - sentiment, it is expected to be weak in the short - term [12] - **Supply Side**: As of mid - April, China's commercial cotton inventory was 415.26 tons. As of April 15, the national cotton direct - seeding progress was 75%, and Xinjiang's planting intention area increased by 1.8% [12] - **Demand Side**: After "Golden March and Silver April", the market enters the off - season. As of May 8, the mainstream spinning mills' operating rate was 74.4%, and it is expected to decline next week. There are signs of inventory accumulation in downstream sectors [12] Option Strategy - **Volatility Judgment**: The 120 - day HV of cotton was 10.5156 yesterday, and the implied volatility of some options increased slightly [19] - **Option Strategy Recommendation**: Sell call options [19][21] Futures Trading Strategy - **Trading Logic**: In the short - term, cotton supply is sufficient and demand is average. After "Golden March and Silver April", the market enters the off - season, and there are signs of inventory accumulation. In the long - term, the US economy may face recession, and cotton prices are expected to decline [21] - **Specific Strategies**: Unilateral: US cotton is expected to be slightly strong, and Zhengzhou cotton is expected to fluctuate in the short - term and decline in the medium - to - long - term. Consider shorting on rallies. Arbitrage: Short September and long January. Option: Sell call options [21] Weekly Data Tracking - **Internal and External Price Difference**: Data on internal and external cotton price differences and 9 - 1 - month price difference trends are presented [23][24] - **Mid - end Situation**: Data on the operating rate and inventory days of pure cotton spinning mills and all - cotton fabric mills are shown [26] - **Cotton Inventory**: Data on national cotton commercial inventory, spinning mills' industrial inventory, and reserve inventory over the years are provided [27] - **Futures - Spot Basis**: Data on the basis of cotton in different months and the basis of US cotton are presented [29]

Report Industry Investment Rating - The report is generally bearish on the cotton market [2] Core Viewpoints - The global supply and demand adjustment in the 2024/25 cotton season is not significant, with a slight decrease in production, a decline in consumption, a minor reduction in imports and exports, and an increase in ending stocks [1][2] - The ongoing global trade conflict, especially the situation between China and the US, is the main factor influencing the short - term cotton market. Attention should be paid to the subsequent development of China - US trade and the planting and weather conditions in the Northern Hemisphere [1][2] Summary by Related Catalogs 2024/25 Annual Supply and Demand Data Adjustments - **Production**: Global production is down 15,000 tons, with China's production up 54,000 tons to 6.967 million tons, and no adjustments for other major producers. The new - season planting in China and the US has started, and the supply data is basically settled [1] - **Consumption**: Global consumption is down 114,000 tons month - on - month, with China's consumption down 109,000 tons, mainly due to the intensification of China - US trade frictions and the temporary halt of China's textile and clothing exports to the US [1] - **Imports**: Global imports are down 71,000 tons month - on - month, with China's imports down 66,000 tons to 1.415 million tons [2] - **Exports**: Global exports are down 81,000 tons, with Brazil's exports down 21,000 tons, the US's down 22,000 tons, Australia's down 22,000 tons, and Turkey's up 43,000 tons [2] - **Ending Stocks**: Global ending stocks are up 115,000 tons month - on - month, with China's up 98,000 tons, the US's up 22,000 tons, Australia's up 21,000 tons, and Brazil's up 22,000 tons [2] Supply - Demand Balance Sheet Summary - **Production**: From 2020/21 to 2024/25 (April), the total global cotton production has changed from 24.735 million tons to 26.321 million tons, with a decrease of 15,000 tons from March to April 2024 [4] - **Consumption**: The total global cotton consumption has changed from 27.114 million tons to 25.261 million tons, with a decrease of 114,000 tons from March to April 2024 [4] - **Imports**: The total global cotton imports have changed from 10.577 million tons to 9.223 million tons, with a decrease of 71,000 tons from March to April 2024 [4] - **Exports**: The total global cotton exports have changed from 10.576 million tons to 9.217 million tons, with a decrease of 81,000 tons from March to April 2024 [4] - **Ending Stocks**: The total global cotton ending stocks have changed from 15.834 million tons to 17.17 million tons, with an increase of 115,000 tons from March to April 2024 [4]