16,291 RMB per ton—this is the base price for the first week of the 2026 central reserve cotton sales, equivalent to standard grade 3128B. This figure will serve as the core cost reference for cotton textile enterprises in the coming week.
Background
China Reserve Cotton Management Co., Ltd. officially launched the 2026 central reserve cotton sales on July 20. The base price for the first week (July 20-24) is set at 16,291 RMB/ton. This price is not fixed—the actual base price for each daily batch will be adjusted based on cotton inspection results and the domestic cotton quality differential table published by the China Cotton Association.
This release comes against a backdrop of tightening domestic cotton supply-demand balance in the 2025/26 season. The government's move aims to stabilize raw material price fluctuations and ensure cotton supply for textile mills. For downstream weaving and dyeing sectors, this means reduced uncertainty in raw material costs for the second half of the year.
Notably, the pricing mechanism incorporates quality differentials. This means higher-grade cotton may trade above the base price, while lower grades may see discounts. Buyers need to precisely match batches to their product mix to avoid cost mismatches.
Industry Impact
What does the 16,291 RMB/ton base price mean for the cotton textile chain? From a cost perspective, current spot prices for grade 3128B cotton have been hovering in the 16,500-17,000 RMB/ton range, making the reserve price noticeably lower than the market average. For yarn mills, this spread translates into hundreds of RMB per ton in profit margins, especially when cotton yarn prices are under pressure and downstream grey fabric procurement is cautious.
In terms of purchasing rhythm, the concentrated release of reserve cotton will change inventory behavior. Enterprises that previously relied on spot market purchases now have a clear cost anchor. It is expected that raw material inventory cycles will extend from 15-20 days to over 30 days in the coming month to lock in low-cost resources. This hoarding behavior will in turn suppress speculative demand in the spot market, forcing traders to lower prices.
For export-oriented enterprises, stable raw material prices mean improved competitiveness in foreign quotes. In the first half of 2026, international cotton price volatility squeezed Chinese cotton textile export order profits to a thin 3-5%. If reserve sales can keep domestic cotton prices low, it will help export enterprises secure more long-term orders in the second half.
- For weaving mills: Cotton accounts for about 60-70% of grey fabric costs. The 16,291 RMB/ton base price directly reduces raw material costs, but vigilance is needed against potential yarn price hikes.
- For dyeing mills: Cotton price volatility indirectly affects dyeing order volumes. Stable cotton prices encourage downstream apparel brands to place autumn/winter fabric orders earlier.
- For chemical fiber enterprises: Weaker cotton prices may reduce the competitive edge of polyester staple fiber and other substitutes, affecting mills' blending decisions.