Reserve cotton continues to be sought after by some cotton companies to acquire seed cotton

Today, there was a slight uptick in electronic trading, while Zheng cotton experienced some volatility. The spot price continued to decline steadily, with cotton merchants increasing shipments, but sales remained slow and transactions were limited. Most of the current buying activity comes from small and medium-sized textile mills, which are still primarily focused on purchasing reserve cotton. Over the past two days, the reserve cotton auction price has seen a modest decline. Some cotton traders anticipate that the reserve cotton auction price could drop significantly by the end of the month, with more aggressive selling likely by the end of September. The enthusiasm among textile enterprises has gradually cooled, with smaller mills continuing to use and purchase cotton as needed. Some cotton companies in Hubei, Xinjiang, and Shanxi have already started preparing for the acquisition of seed cotton for the new season, with plans to finalize their balances by the end of August.

On the 18th, China's Cotton Price Index (CCIndex328) stood at 18,139 yuan/ton, down 2,429 yuan from the average price of 17,722 yuan/ton, marking a 1% decrease. Despite this, domestic cotton prices continue to show a steady and strong trend. As of yesterday, the average price of stored cotton transactions fell for three consecutive trading days, with textile companies participating in auctions in a more rational manner. The role of maintaining market stability is becoming increasingly apparent. Although inquiries in the spot market have slightly increased, actual transactions remain insufficient. On the downstream side, even though textile companies have reduced the price of gauze, order backlogs persist, and finished product inventories have risen. This indicates that demand remains tight despite the price adjustments.