1. Report Industry Investment Rating - No relevant information provided 2. Core Viewpoints of the Report - This week, the price of the main 2605 contract of Zhengzhou cotton slightly declined, with a weekly decline of about 0.17%. The 2603 contract of cotton yarn futures decreased by 0.05%. Considering the approaching Spring Festival, it is advisable to adopt a wait - and - see approach in the short term [5][20] - According to the prediction of ABARES, the cotton output in Australia in the 2025/26 season is 943,000 tons, a year - on - year decrease of 23%, and the planting area is 406,000 hectares, a year - on - year decrease of 22%. However, the high yield in other regions offsets the output loss, and the overall output is still 9% higher than the average of the past decade [5] - In the domestic market, the quantity of inspected cotton has exceeded 7.2 million tons, and the supply pressure is gradually increasing. The trading volume of imported cotton has slowed down due to the approaching Spring Festival. As of January 29, the inventory of imported cotton in main ports increased by 4.25% week - on - week, with a total inventory of 495,400 tons [5] 3. Summary by Relevant Catalogs 3.1 Week - on - Week Summary - **Market Review**: The price of the main 2605 contract of Zhengzhou cotton slightly declined, with a weekly decline of about 0.17% [5] - **Market Outlook**: Australian cotton output and planting area decreased in the 2025/26 season. In the domestic market, the supply pressure is increasing, and the trading volume of imported cotton has slowed down. It is recommended to wait and see in the short term [5] - **Future Trading Tips**: Pay attention to changes in foreign cotton prices, demand, and inventory [6] 3.2 Futures and Spot Market 3.2.1 US Cotton Market - The price of the March contract of US cotton declined this week, with a weekly decline of about 0.99% [11] - As of January 20, 2026, the non - commercial long positions of US cotton were 92,421 lots, an increase of 3,587 lots from the previous week; non - commercial short positions were 118,245 lots, an increase of 1,980 lots from the previous week; the net short position was 25,824 lots, a decrease of 1,607 lots from the previous week [11] 3.2.2 Foreign Cotton Spot Market - In the week ending January 22, the net export sales of US upland cotton in the 2025/26 season increased by 203,700 bales, a decrease of 51% from the previous week and 17% from the average of the previous four weeks [15] - The international cotton spot price this week was 74.15 cents per pound, a decrease of 0.4 cents per pound from last week [15] 3.2.3 Futures Market - The price of the 2605 contract of Zhengzhou cotton slightly declined, with a weekly decline of about 0.17%. The 2603 contract of cotton yarn futures decreased by 0.05% [20] - As of this week, the net position of the top 20 in the cotton futures was - 136,670 lots, and that in the cotton yarn futures was - 1,793 lots [27] - As of this week, the number of cotton futures warrants in the Zhengzhou Commodity Exchange was 10,289, and the number of cotton yarn futures warrants was 0 [33] 3.2.4 Spot Market - As of January 30, 2026, the spot price index of cotton 3128B was 16,183 yuan per ton [41] - As of January 30, 2026, the spot price of Chinese cotton yarn C32S was 21,430 yuan per ton, CY index: OEC10s (air - spun yarn) was 15,200 yuan per ton, and CY index: OEC10s (combed yarn) was 24,350 yuan per ton [52] 3.2.5 Price Difference and Basis - This week, the price difference between the 5 - 9 contracts of Zhengzhou cotton was - 140 yuan per ton, and the price difference between the spot price of cotton 3128B and cotton yarn C32S was 5,247 yuan per ton [36] - This week, the basis between the price index of cotton 3128B and the main contract of Zhengzhou cotton was + 1,513 yuan per ton. The basis between the spot price of cotton yarn C32S and the 2603 contract of cotton yarn futures was 935 yuan per ton [46] 3.2.6 Imported Cotton (Yarn) Cost - As of January 29, the sliding - duty price of imported cotton was 13,671 yuan per ton, a decrease of 13 yuan per ton from last week; the quota price of imported cotton was 12,502 yuan per ton, a decrease of 12 yuan per ton from last week [58] - As of January 29, the import price index of cotton yarn (FCY Index): port pick - up price: C21S was 20,249 yuan per ton; C32S was 21,490 yuan per ton; JC32S was 23,250 yuan per ton [58] 3.2.7 Imported Cotton Profit - As of January 29, the estimated profit of imported cotton under the sliding - duty system was 2,262 yuan per ton, an increase of 127 yuan per ton from last week; the estimated profit of imported cotton under the quota system was 1,892 yuan per ton, an increase of 126 yuan per ton from last week [61] 3.3 Industry Chain Situation 3.3.1 Supply Side - As of the end of December 2025, the national commercial cotton inventory was 5.7847 million tons, a month - on - month increase of 23.51% and a year - on - year increase of 1.75%. The in - stock industrial cotton inventory of textile enterprises was 983,800 tons, an increase of 44,200 tons from the end of last month [64] - In December 2025, China's total cotton import volume was about 180,000 tons, a month - on - month increase of 60,000 tons and a year - on - year increase of 31%. From January to December 2025, China's cumulative cotton import volume was 1.07 million tons, a year - on - year decrease of 59.1%. In December 2025, China's imported cotton yarn was 170,000 tons, a month - on - month increase of 60,000 tons and a year - on - year increase of 20,000 tons [68] 3.3.2 Mid - end Industry - As of the end of December, the yarn inventory of textile enterprises was 25.1 days, a month - on - month decrease of 1.2 days. The grey fabric inventory was 33.8 days, a month - on - month increase of 1.4 days [71] 3.3.3 Terminal Consumption - In December 2025, China's textile and clothing export volume was 25.99 billion US dollars, a year - on - year decrease of 7.4% and a month - on - month increase of 8.9%. Among them, textile exports were 12.58 billion US dollars, a year - on - year decrease of 4.2%; clothing exports were 13.41 billion US dollars, a year - on - year decrease of 10.2% [75] - As of December 31, 2025, the monthly retail sales of clothing, footwear, needles, and textiles were 166.1 billion yuan, a month - on - month increase of 7.75% [79] 3.4 Options and Stock Market - related Market - **Options Market**: The implied volatility of at - the - money options of cotton this week is presented in relevant charts [80] - **Stock Market**: The price - to - earnings ratio trend of Xinjiang Nongkai Development Co., Ltd. is presented in relevant charts [83]