In mid-April 2026, both domestic and international cotton markets exhibited volatile yet generally bullish trends. Domestic cotton prices were supported by expectations of a reduction in Xinjiang’s cotton planting area, while international prices were driven by drought in U.S. cotton-growing regions and geopolitical conflicts, resulting in a continued narrowing of the price gap between domestic and international markets. Based on SunSirs latest benchmark price, this report provides a systematic analysis of the logic behind cotton price fluctuations, the current market situation, and future trends.

I. This Week’s Cotton Price Performance and Underlying Logic

Domestic cotton prices maintained a slight upward trend. The SunSirs cotton benchmark price stood at RMB 16,721.33 per ton, a 0.75% decrease compared to the beginning of the month (RMB 16,847.00 per ton). Key drivers of the rise: First, spring planting has fully commenced in Xinjiang, and market expectations of a reduction in cotton planting area continue to intensify, creating positive momentum on the supply side. Second, although downstream textile demand shows signs of weakening, overall resilience remains stronger than the same period last year, with essential demand providing a floor for cotton prices.

International cotton prices have risen even more significantly. The driving factors are concentrated in three areas: severe drought in the main U.S. cotton-producing regions, with 94% of the production areas experiencing drought—a sharp increase of 60 percentage points year-on-year—fueling market concerns about the new season’s output; the volatile situation in the Middle East has kept the Brent crude oil benchmark at a high of $115.00 per barrel, driving up agricultural input and logistics costs; and the weakening U.S. dollar has further boosted international cotton prices, which are denominated in dollars.

Currently, domestic cotton prices are approximately RMB 2,981 per ton higher than imported cotton, with the price differential between domestic and imported cotton narrowing by RMB 263 per ton compared to earlier periods, making imported cotton more cost-effective.

II. Trends in Supporting Products Across the Textile Industry Chain

Prices in the textile sector remained generally stable. The SunSirs C32S cotton yarn benchmark price stood at 22,285 RMB/ton, with domestic and imported yarn prices largely on par; the average price of imported yarn was slightly higher than that of domestic yarn by 1 RMB/ton, and market trading remained steady.

Regarding alternative raw materials, the benchmark price for SunSirs polyester staple fiber stood at RMB 8,153 per ton, down RMB 115 per ton for the week. Prices trended weakly, creating a certain price differential substitution effect with cotton; however, the overall impact on cotton prices remained limited.

III. Macroeconomic and Key Influencing Factors

Ongoing Geopolitical Tensions

The situation in the Middle East remains unstable, and the outlook for navigation through the Strait of Hormuz is uncertain. Risks to global shipping and energy supplies are rising. High crude oil prices continue to drive up the costs of cotton cultivation, processing, and logistics, providing long-term cost support.

Global Supply-Demand Dynamics Tightening

U.S. cotton planting progress is on track, but extreme drought threatens yields and planting intentions; Australian cotton exports are proceeding rapidly, but available export volumes will be limited in the latter part of the season. Coupled with expectations of an El Niño climate event, the risk of weather disruptions in major global cotton-producing countries is rising, reinforcing expectations of tight supply.

Domestic Supply-Demand Dynamics and Policy Support

Spring planting progress in Xinjiang is slightly ahead of previous years; actual planting area will be confirmed by the end of April, and expectations of a downward revision in acreage continue to support the market. Domestic efforts to upgrade textile industry standards, combined with a moderate rebound in the CPI, are gradually improving the domestic demand environment, providing support for cotton spinning demand.

Signs of Weakening Downstream Demand

Textile enterprises are facing insufficient new orders, with cotton yarn inventories rising slightly, leading to cautious raw material procurement. Rising raw material prices and logistics costs are squeezing profit margins, while the inability to effectively pass on high cotton prices to downstream sectors is limiting upside potential for cotton prices.

IV. Market Outlook

In the short term, domestic cotton prices are expected to maintain a range-bound, slightly bullish pattern. Expectations regarding planting area, cost support, and domestic demand policies constitute upward momentum; while sluggish downstream demand and the difficulty in passing on high prices exert downward pressure. International cotton prices remain dominated by weather and geopolitical factors, making them more likely to rise than fall.

In the medium term, four key variables warrant close monitoring: actual cotton planting area in Xinjiang, weather conditions in U.S. cotton-producing regions, developments in the Middle East, and the recovery of downstream orders. Against the backdrop of a tight supply-demand balance and high costs, the probability of a significant decline in cotton prices is low, and prices are expected to trade in a range at elevated levels.

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.