downstream demand for cotton yarn is weak

To sum up, downstream demand for cotton yarn is weak, and it is almost certain that demand will decline in October compared with September. The overall supply of cotton yarn reduces due to the epidemic upgrading in Xinjiang, giving some support for cotton yarn prices. Besides, domestic mills face the pressure of tight spot cotton supply and the rising of prices. When epidemic control will release in Xinjiang is uncertain. Even if cotton prices rise, it is not very likely for traders to buy a large number of cottons and cotton yarns as traders and mills are afraid of the falling back of prices due to the increase of supply after lift lockdown in Xinjiang. Moreover, there is much current cotton yarn inventory, so the rising of cotton yarn price is with great resistance. If cotton yarn prices rise, the rise range is not expected to pass over cotton’s, making profit of cotton yarn mills narrow and even turn to losses. If epidemic control time is too long, domestic cotton yarn mills have to reduce, suspend or transfer the production.