The reform of the target price for Xinjiang cotton has yielded significant results.

　　In recent years, influenced by the global economic environment, international agricultural commodity prices have fallen sharply. At the same time, domestic prices for major agricultural products have gradually risen due to a combination of government policies—such as temporary procurement and storage programs and minimum market support prices—and steadily increasing cotton‑growing costs. This has led to a widening gap between domestic and international agricultural prices, prompting a surge of imported agricultural goods into the domestic market, undermining tariff‑based protection, driving up domestic inventories, and placing an additional fiscal burden on the government.

　　In 2014, to address longstanding challenges, the state launched a pilot program for cotton target-price reform in Xinjiang. Over the past three years, with close collaboration among all localities and departments across the autonomous region and active participation from market entities, the pilot has yielded significant results, earning broad recognition from both the national government and various sectors of society. It holds important implications for the sound development of Xinjiang’s agriculture and for the ongoing efforts to deepen supply-side structural reform in the agricultural sector.

　　First, a market‑based pricing mechanism oriented to market demand has been largely established, bringing market prices back to normal levels. The government no longer intervenes directly in the market; the price gap between domestic and international cotton markets has narrowed significantly; the competitive environment for domestic textile enterprises has improved; tariff‑based protective measures have been gradually restored; and the purchase price of seed cotton now fluctuates in tandem with local supply‑and‑demand conditions as well as domestic and international futures and spot prices for lint cotton.

　　Second, the entire cotton industry chain has been revitalized, and market mechanisms have been effectively brought into play. Following the implementation of the cotton target price reform, integrated development across the value chain—from production and processing to textiles and apparel—has accelerated markedly, with pronounced agglomeration effects and a faster emergence of strategic layouts spanning the entire industry chain. With the government refraining from intervening in market prices, all cotton‑related stakeholders now engage directly with the market and assume a share of market risk. Overall, market awareness and risk consciousness among these stakeholders have further strengthened, the market‑driven adjustment mechanism has become more evident, and the domestic cotton industry’s international competitiveness has been restored and enhanced.

　　Third, it has safeguarded farmers’ interests and boosted the development of Xinjiang’s textile and apparel industry. Amid sluggish market prices over the past two years, target-price subsidies have served as a crucial source of income security for Xinjiang’s cotton farmers, ensuring predictable basic earnings. Moreover, reduced cotton‑use costs and a series of regional policies supporting the growth of the textile and apparel sector have injected fresh momentum into the industry. Domestic textile and apparel firms have accelerated their relocation to Xinjiang, leading to a marked increase in capacity utilization and profitability. This has significantly expanded employment opportunities for surplus rural labor in the region, thereby contributing positively to social stability and long-term peace and prosperity in Xinjiang.

　　Fourth, the target price policy has yielded tangible benefits, further optimizing Xinjiang’s crop‑production structure. Farmers now base their decisions on the cotton target price to forecast annual returns, enabling them to more flexibly select suitable crops for cultivation. By leveraging market‑based mechanisms and expectation‑management tools to adjust planting patterns, the policy has produced markedly positive results. The successive reductions in the target price have effectively cut cotton‑cultivation area in Xinjiang by 7.657 million mu, guiding regions with suboptimal conditions and high production risks to phase out cotton farming altogether. This has reversed the longstanding trend of uncontrolled expansion in cotton acreage, ensuring the rational allocation of water and land resources and safeguarding the ecological environment.

　　Fifth, awareness of cotton quality has significantly increased, and the pace of adjusting the structure of cotton varieties and quality has accelerated. The current target-price subsidy for cotton is a unified subsidy applied across Xinjiang; by improving cotton quality at each stage of production, producers can secure higher returns, which to some extent has heightened their motivation to adjust cotton quality throughout the supply chain.

　　On March 16, 2017, after thorough consideration of the future development of China’s cotton industry and the unique regional conditions in Xinjiang, and with the approval of the State Council, the National Development and Reform Commission and the Ministry of Finance jointly issued a document stipulating that, starting in 2017, the cotton target price reform would continue to be deepened in Xinjiang. The target price for cotton would remain fixed at RMB 18,600 per ton for a three-year period. For Xinjiang, this means, on the one hand, that the state has provided sustained and stable reform policies, further safeguarding the fundamental interests of cotton farmers and consolidating the region’s position in the cotton industry; on the other hand, it also entails higher expectations from the central government, requiring us to attach greater importance to and implement all reform measures more diligently to ensure the smooth advancement of the reforms.