On April 14, quoted prices at China's major ports rose. The International Cotton Price Index (SM) stood at 86.70 cents per pound—an increase of 1.36 cents per pound—translating to a general trade port pickup price of 14,700 RMB/ton (calculated based on a 1% tariff and the Bank of China's central parity rate; the same applies hereinafter). The International Cotton Price Index (M) stood at 84.78 cents per pound—an increase of 1.39 cents per pound—translating to a general trade port pickup price of 14,379 RMB/ton.

Analysis and Commentary

Raw Cotton

The International Cotton Price Indices (SM and M grades) rose by 1.36 cents/lb and 1.39 cents/lb, respectively. Converted to port-delivery prices, these figures reached 14,700 RMB/ton and 14,379 RMB/ton. This indicates either strong spot market demand or tight supply—factors that directly drove up spot prices and created a clearly bullish market environment. The benchmark cotton futures contract (e.g., the 2609 contract) rose by 15 RMB/ton, accompanied by an increase of 5,174 lots in open interest; this demonstrates strong bullish sentiment within the market, suggesting that futures prices are poised to continue their upward trend.

Cotton Yarn

With the price of cotton—the primary raw material—rising sharply, production costs for cotton yarn have increased; this is likely to drive up spot prices for cotton yarn, thereby establishing a supportive floor based on production costs. Cotton yarn futures contracts—such as the 2605 contract—have risen by 70 RMB/ton, pushing the settlement price up to 21,780 RMB/ton. Active trading volume suggests that the market anticipates cotton yarn prices will strengthen, driven by the upward trend in raw materials, thereby bolstering the performance of futures contracts.

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