The rise in the Chinese cotton futures market is mainly dominated by the mood.

Speculators pay more attention to the ZCE cotton futures.

The state cotton auction is going on, registered warehouse receipts hit a new high and the market is oversupplied.

Buyers on the spot market procured the on-call cotton sources, pushing up ZCE cotton futures. On April 4, China announced adding an additional 25 per cent tariff on cotton originating from the US. Though the market was quiet, market mindset has changed somewhat, and players are concerned about the supply of 2018/19 US cotton.

In late April, the downstream yarn and fabric market rebounded slightly, and orders increased. An upward tendency was seen, but the strength was weak.

The quantity of on-call cotton contracts on ICE July contract has hit a historical high, and US cotton is oversold, while registered warehouse receipts are very limited.

The relationship between ICE and ZCE cotton futures became closer due to the trade dispute.

With on-going de-stocking in China, whether the state cotton auction will continue next season remains uncertain, so forward contracts are relatively sensitive towards the bullish factors.

After the rise on forward contracts, nearby contracts climbed up as well.