SunSirs: As Pre-Holiday Inventory Replenishment Nearing Its End, Cotton Prices Were Fluctuating at High Levels

Price trend

Last week, domestic cotton prices fluctuated within a narrow range. Cautious restocking by downstream businesses suppressed further price increases. According to SunSirs' commodity market analysis system, as of January 26th, the spot price of 3128B grade lint cotton was 15,998 RMB/ton, a 0.68% increase compared to the previous week.

Market analysis

Domestic new cotton processing was nearing completion, and overall market supply was abundant. Downstream textile enterprises were generally cautious in their restocking efforts due to limited new orders before the holiday, mainly purchasing only what they needed. According to data from the National Cotton Market Monitoring System, as of January 22nd, the national processing rate was 97.3%, a decrease of 1.2 percentage points year-on-year; the national sales rate was 62.7%, an increase of 24.1 percentage points year-on-year.

In the latest week, U.S. net export sales of upland cotton for the 2025/26 marketing year totaled 93,600 tons, a 21% increase from the previous week and a new high for the year. Shipments totaled 42,600 tons, a 20% increase from the previous week and also a new high for the year. However, despite strong U.S. cotton export data, ICE cotton futures remained weak, and international cotton prices were generally under pressure. Last week, the average settlement price of the main contract was 64.08 cents per pound, a decrease of 0.75 cents per pound from the previous week, a decline of 1.2%.

Market outlook

With the Spring Festival approaching, yarn inventory shipments were accelerating, but new orders were insufficient, and production remained stable. Downstream pre-holiday restocking was nearing completion, but rising cotton prices had boosted market sentiment. Short-term cotton prices are expected to remain volatile at high levels. In the medium to long term, there is still a possibility of a reduction in Xinjiang cotton planting area in the 2026/27 season, providing upward momentum for domestic cotton prices.

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