The chill of the textile off-season is clearly reflected in cotton prices. In June 2026, the monthly average of the China Cotton Price Index (CCIndex) stood at 17,547 yuan/ton, down 242 yuan/ton from the previous month, a decline of 1.36%. More notably, the domestic-foreign price spread widened to 3,179 yuan/ton—a figure that means domestic textile mills face significantly higher raw material costs than their overseas counterparts, while weak downstream orders prevent these costs from being passed through smoothly.
Domestic Cotton Prices: Off-Season Demand Suppression, Output Concerns Provide Floor
Domestic spot prices experienced three rounds of tug-of-war in June. Early in the month, CCIndex briefly hit 17,899 yuan/ton, but mills' restocking appetite quickly cooled amid insufficient orders, pulling prices down to 17,336 yuan/ton by June 12. In mid-June, persistent high temperatures in Xinjiang sparked concerns over cotton yields, coupled with expectations of tight commercial inventories at year-end, leading to a short-lived rebound to 17,632 yuan/ton. However, rising finished-goods inventories, declining mill operating rates, and falling oil prices—which made chemical fibers more competitive—pushed prices back to 17,554 yuan/ton by month-end.
Futures markets proved more sensitive. The average settlement price of the Zhengzhou Cotton Exchange (ZCE) main contract was 15,944 yuan/ton, down 313 yuan/ton or 1.93% month-on-month. The spot-futures spread remained deeply discounted at 1,474 yuan/ton, reflecting persistent market concerns over potential state reserve releases and a lack of buying momentum. The long-staple market was equally subdued; the 137-grade variety closed the month at 26,930 yuan/ton, down a marginal 40 yuan/ton, but the premium over fine-staple cotton narrowed to 8,850 yuan/ton, indicating that even high-end demand faced headwinds in the off-season.
International Markets: Macro and Weather Factors Drive Deeper Declines
International cotton prices followed a similar trajectory to domestic ones but with greater volatility. The average monthly settlement price of the ICE cotton main contract was 77.77 cents/lb, down 4.46 cents/lb or 5.42% month-on-month—roughly four times the decline of domestic spot prices. Early in the month, India's temporary exemption of cotton import tariffs briefly boosted demand expectations, but improved rainfall in U.S. cotton regions, a stronger U.S. dollar, and the threat of new tariffs quickly dominated, dragging ICE cotton from 81.58 cents/lb to 75.17 cents/lb. In mid-June, the USDA supply-demand report lowered global ending stocks, while intensifying El Niño conditions raised concerns about Northern Hemisphere production, pushing prices back to 80.47 cents/lb. By month-end, a U.S.-Iran deal pushed oil prices lower, the Federal Reserve's rate hike expectations strengthened, and drought conditions in U.S. cotton areas continued to ease, sending prices back to around 75 cents/lb.
The China Import Cotton Price Index (FCIndex M) averaged 86.69 cents/lb in June, down 6.79% month-on-month. At the 1% tariff rate, imported cotton landed at around 14,375 yuan/ton, which was 3,179 yuan/ton below domestic spot prices—a spread that widened by 618 yuan from May. This widening spread offers a clear arbitrage window for mills with import quotas, but for small and medium-sized enterprises relying on domestic cotton, it means a deepening cost disadvantage.
Downstream Transmission: Order Differentiation, Yarn Prices Under Pressure
June's cotton yarn market showed structural unevenness. The average price of 32-count pure cotton yarn was 23,333 yuan/ton, up a mere 56 yuan/ton or 0.24% from May. In the first half of the month, rising cotton prices temporarily improved mill margins, but in the second half, inventory pressure forced mills to offer discounts, leading to a slight decline in yarn prices. Large and medium-sized mills generally had full order books, while small mills faced scarce orders and declining operating rates, deepening industry polarization. Polyester staple fiber closed the month at 7,250 yuan/ton, down 525 yuan/ton, while viscose staple fiber rose 200 yuan/ton to 14,300 yuan/ton—chemical fiber substitution continued to divert demand when cotton prices remained elevated.