On July 20, 2026, China National Cotton Reserves Corporation will officially launch the new round of central reserve cotton sales. The floor price for the first week (July 20-24) for standard grade 3128B is set at 16,291 yuan per ton. This figure is not arbitrary; it is calculated based on recent market average prices, as required by relevant state authorities and the sales announcement, combined with the 'Domestic Cotton Quality Differential Table' issued by the China Cotton Association.
Price Anchor and Market Logic
The floor price of 16,291 yuan per ton essentially draws a clear price line for the short-term cotton market. This means that regardless of spot market fluctuations, the state reserve cotton sale price will be anchored to this level, with daily actual transaction prices floating based on inspection results and the quality differential table. For textile mills, this serves both as a cost reference point and a bargaining starting point—below this price, reserve cotton offers clear cost-effectiveness; above it, procurement timing must be carefully considered.
From an industrial chain perspective, the volume and pricing mechanism of reserve cotton releases directly impact the cost structure of downstream yarn, fabric, and even garments. The cotton textile industry is currently squeezed by high raw material costs and weak end-demand. The timely release of reserve cotton essentially provides a 'price stabilizer' for mills. However, whether this stabilizer works effectively depends on actual release volumes and the rationality of auction enthusiasm.
Industrial Belt Reactions and Procurement Sentiment
In traditional cotton textile industrial belts such as Shandong, Henan, and Jiangsu, procurement departments are recalculating inventory levels and order cycles. Some large spinning mills prefer to participate in the first week's auction to lock in low-cost raw materials, while more small and medium-sized enterprises adopt a wait-and-see approach, fearing that concentrated bidding might drive up actual transaction prices and erode profit margins. This divergence in sentiment reflects differing views on future cotton price trends—bulls see the reserve floor price as the bottom, while bears expect further downside when new cotton arrives.
Notably, this year's floor price is higher than last year's, reflecting the tight supply-demand balance in the 2025/26 cotton season. Although Xinjiang cotton production remains stable, structural shortages of high-quality cotton persist, making reserve cotton a key tool to fill market gaps and smooth structural imbalances.