Ms. Chen delivered a systematic analysis of the operating logic and future trends of the global cotton industrial chain for the 2026/27 season. 

The global cotton market is currently characterized by a core pattern of "tightening supply and resilient demand". Global cotton planting area for 2026/27 is expected to decline slightly, with China, Australia and Brazil as the main reducing regions affected by policies, weather and price ratios. Coupled with persistent drought in major U.S. producing areas and the potential impact of El Niño, global cotton output may see a modest decline. As the core production region, Xinjiang also faces phased reductions in planting area and output.

On the price front, Chinese cotton price 3128 has shown strong trending volatility, with a notable drop in commercial inventories and high industrial inventories. China domestic and international cotton prices are significantly influenced by supply-demand expectations and policy adjustments, with the price center expected to move upward.

In terms of industrial chain transmission, downstream spinning operating rates remain at a year-on-year high with relatively low inventories, and robust consumption may further tighten end-of-season stocks. Meanwhile, international geopolitical conflicts have pushed up prices of crude oil, chemical fibers and other raw materials, while prices of cotton, viscose, Lyocell and other fibers have remained relatively stable. Changing price differentials may encourage downstream enterprises to optimize raw material ratios and increase the consumption share of cotton fiber.

Overall, shrinking cotton supply and supportive downstream demand have reinforced each other, lifting the price center of cotton in the 2026/27 season. The textile industrial chain needs to focus on the impacts of raw material cost volatility and substitution effects.