According to the commodity market analysis system of Business Society, as of January 9, the spot price of 3128B-grade cotton was 15,930 yuan per ton, representing an increase of 2.45% compared to the beginning of the month. The domestic cotton market has shown strong performance recently, with the price of the main Zhengzhou cotton futures contract breaking through the 15,000 yuan per ton mark on the 8th, reaching a high of 15,095 yuan per ton, the highest level in nearly a year and a half. However, it also encountered significant resistance, with prices slightly retreating on the 9th. Since the beginning of the year, both spot and futures cotton markets have performed well, with the overall price center shifting upward. Cotton processing enterprises generally maintain a firm pricing strategy for sales, and the market as a whole exhibits a pattern of "stable volume and firm prices."

Affected by weak export sales data, ICE cotton futures continued their downward trend. The market is closely watching the upcoming USDA supply and demand forecast next week. Based on recent market feedback, U.S. cotton production for this year may be slightly revised downward.

The rise in upstream cotton prices contrasts sharply with the profit difficulties faced by downstream textile enterprises. Currently, the textile industry is in a seasonal off-season, and enterprises have weak bargaining power, leading to profits concentrating at the front end of the industrial chain. Profits in downstream processing segments are continuously being squeezed. The market price of cotton yarn remains generally stable, with some localized price increases, but the magnitude of these increases is small. Sales of medium- and low-count yarns are still slowing, making it difficult to raise prices. Textile enterprises are making small-scale, necessity-driven purchases of cotton, with limited enthusiasm for stockpiling.

Outlook: The main factors driving the recent strong upward trend in cotton prices are expectations of a significant reduction in domestic supply by 2026 and the resilience of demand driven by consumption policies. However, upstream price increases have not been effectively transmitted downstream, leading to escalating competition between upstream and downstream segments of the industrial chain. It is expected that cotton prices may face a risk of correction after reaching highs, but current support remains relatively solid, limiting the downside potential.