On April 23, 2019, the National Bureau of Grain and Material Reserves and the Ministry of Finance jointly released the 2019 announcement on the rotation of some central reserve cotton.

The announcement pointed out that the reserve cotton rotation time for May 5, 2019 to September 30, 2019 during the period of the national legal working days, the total amount of about 1 million tons, the bottom price of listed sales with the market dynamics to determine, through the national cotton trading market open bidding listed for sale.

Market long-awaited reserve cotton rotation news landed, the industry for rapid forwarding, enterprises have expressed optimism about the late reserve cotton rotation, and praise for the rotation policy. Due to the recent cotton spot prices remain strong, part of the textile enterprises in the face of the high price of cotton is difficult to digest, more to maintain a wait-and-see attitude, cotton raw material inventories to maintain a low level, waiting for the reserve cotton rotation.

Whether the cotton reserve rotation can achieve the national inventory, small and medium-sized enterprises to add power to the win-win situation, mainly to see the downstream consumer demand. Shandong, a major production of low-count yarn spinning enterprise responsible person said, 2019 Spring Festival so far, the raw material market fluctuations, the market is difficult to find low-priced cotton, the production of cotton products appeared price inversion phenomenon, as a member of small and medium-sized enterprises, the reserve cotton rotation is like a “life-saving straw”, the textile enterprises said that they will be Hold on tightly.

Since April, cotton prices have a downward trend, part of the textile factory profits are not guaranteed, the cotton reserve rotation to the small and medium-sized textile enterprises have brought hope, especially the plan to purchase low-grade cotton enterprises, the benefits of self-evident, not only to ensure that the market's smooth operation, but also reduces the degree of fluctuations in cotton prices to the textile enterprises to the risk of business.

The market is expected, after the start of the reserve cotton rotation, spinning enterprises in the case of falling raw material costs, sales improvement, yarn profit recovery will be sooner or later.