market players shall be cautious about the high prices and keep an eye on the risks

There were sayings about prices of 10yuan/kg. In terms of the early-arrived seed cotton prices, the prices for both upcountry cotton and Xinjiang cotton are 50% higher than the same period of last year. No matter for the increment of planting costs, production reduction range, consumption growth of cotton or the increase of currency, there are no such high fluctuation range on cotton supply and demand. By Sep 6, CCFGroup Chinese 3128 cotton has risen by 43% year on year, and ZCE cotton futures rise by 45%, which is lower than the rise of seed cotton. Currently, ginners take ZCE cotton futures as reference to settle prices of seed cotton, while ZCE cotton futures want to be guided by seed cotton prices. Meanwhile, downstream buyers have to accept high cotton prices with no production cut and no shifting to other products. Nevertheless, downstream buyers have shown some weakness in accepting the high prices and the traditional peak season is not buoyant as expected. So market players shall be cautious about the high prices and keep an eye on the risks.