On August 3, reserve cotton auctions once again closed with a 100% turnover rate, marking the 11th consecutive session of full sales. All 8,014.638 tons offered were sold, with an average price of 16,862 yuan/ton, down 96 yuan from the previous day. Beneath the surface of stable volume and price, a subtle structural divergence is emerging—imported cotton and Xinjiang cotton are showing widening price gaps and different bidding premiums, signaling that mills have shifted from panic buying to selective purchasing.
Temperature Differences in Transaction Data
Imported cotton averaged 17,089 yuan/ton, 506 yuan higher than Xinjiang cotton, and the gap in 3128-equivalent prices widened to 495 yuan/ton. More telling is the premium: imported cotton commanded an average premium of 1,609 yuan/ton, while Xinjiang cotton saw only 1,114 yuan/ton—a difference of nearly 500 yuan. This indicates that despite the 'indiscriminate' prosperity of full turnover, competition for high-grade, high-spinnability cotton remains intense, and the structural shortage of premium fiber has not eased.
Cumulatively, from July 20 to August 3, reserve cotton sales reached 88,208.582 tons, with turnover consistently at 100%. However, the average price curve is not unidirectional upward—on August 3, Xinjiang cotton fell 80 yuan/ton, and imported cotton dropped 62 yuan/ton, showing a slight downward drift. This combination of 'full turnover but slight price decline' typically suggests that downstream order support is insufficient to push prices higher, and mills are replacing advance stockpiling with on-demand procurement.
Price Transmission and Mill Profitability
As a 'ballast stone' for domestic cotton prices, reserve cotton auction prices directly influence yarn quotation expectations. The current 3128-equivalent price of 17,553 yuan/ton, down 48 yuan from the previous day, is not drastic but sends a clear signal: the policy side's intention to stabilize prices through reserve releases continues, while the industry's acceptance of high raw material costs is nearing a ceiling.
For mills, the 100% turnover rate reflects genuine demand—some companies have orders scheduled through September and must secure raw materials. But the divergence in premiums also reminds us that product structure determines bargaining power. Producers of high-count, high-value-added yarns are willing to pay higher premiums for imported cotton, while mills making conventional products are more sensitive to the cost-effectiveness of Xinjiang cotton. This divergence may intensify in subsequent auctions, so buyers should set premium caps based on their product lines.
The Value of Real-Time Market Tools
During the reserve sales period, the real-time market system jointly launched by the National Cotton Trading Market and China Cotton Information Network is changing how companies participate. By dynamically monitoring transaction volumes, premium ratios, and participation intensity, buyers no longer rely on lagging information and can make more precise decisions within bidding windows. This data transparency objectively reduces blind bidding caused by information asymmetry, helping the market return to rationality.
Key Variables for the Coming Weeks
Three variables deserve attention in the next two weeks: first, whether the volume of imported cotton releases will adjust—if it remains high, the premium for high-grade cotton may narrow; second, the basis between Zhengzhou futures and reserve auction prices—if futures discounts widen, mills may shift to point pricing; third, downstream fabric and dyeing operating rates—if terminal orders weaken, the current 100% turnover phenomenon may loosen.