CT SPECIALIST · Softs / China Supply
Z32293 – [CT] POWER Heat Stress China Xinjiang Signal
Peak-summer heat over Xinjiang, the Chinese cotton region producing roughly 85 percent of domestic supply, damages flowering and boll development and transmits stress to Cotton futures at 60-day horizons.
At a glance
DORMANT · WAITING FOR JUL
Current reading
-0.572
SEASONAL STATE
DORMANT · WAITING FOR JUL
China Xinjiang peak-heat window runs July through August; off-season composite tracks…
Signal state
Low Heat Stress
15 days in Neutral phase
Updated
Nov 04, 2026
NASA POWER daily release
Sample
26-year window
Daily cadence; 2000 onward
As of Nov 04, 2026. Updated nightly. · NEXT WINDOW JUL-AUG XINJIANG PEAK-HEAT WINDOW
SIGNAL OVERVIEW
Xinjiang produces roughly 85 percent of China’s cotton. The Tarim Basin and northern Xinjiang growing regions run peak heat stress in July and August during flowering and early boll development when cotton plants are most vulnerable to high-temperature damage. When daily maximum temperatures persistently exceed 35 degrees Celsius during this window, yield compresses materially; China is the world’s second-largest cotton producer and heat-driven supply shocks transmit to Cotton futures at 60-day horizons via tightened global balance. Daily Spearman IC against Cotton forward 60-day returns is plus 0.064 at p-value 1.4e-07 across 6,676 observations, statistically significant on the 26-year sample. The phase pattern is monotone with Phase +1 (High Heat Stress) delivering plus 6.97 percent fwd60d versus Phase -1 (Low Heat Stress) at minus 10.44 percent.
LIVE CHART
CT POWER Heat Stress China Xinjiang Signal
What the chart is showing right now. The dark line is the NASA POWER T2M_MAX heat-stress-day count z-score over China Xinjiang cotton belt, tanh-bounded. Positive composite means heat-stress days are elevated above trend; negative composite means below. The bronze line in the middle panel is ICE US Cotton No. 2 first-nearby. The bottom panel tracks the trailing 252-day Spearman information coefficient between the composite and Cotton forward 60-day returns.
CHART PLACEHOLDER
Live chart renders here once the Node.js data layer is wired. Until then this slot shows a static placeholder.
COMPOSITE
-0.572 / tanh
STATE
Low Heat Stress
PHASE
-0.65
PHASE +1 EDGE
+6.01 pp
PHASE -1 EDGE
-5.52 pp
TODAY’S PLAYBOOK READING
STATE
Moderate Neg
STATE AND HISTORY
Low Heat Stress firing at composite -0.572, 15 trading days running in Neutral phase. Phase +1 (High Heat Stress) delivers plus 6.97 percent fwd60d. Phase -1 (Low Heat Stress) delivers minus 10.44 percent fwd60d. Daily Spearman IC plus 0.064 at p-value 1.4e-07 statistically significant.
THE STRESS MECHANISM
Xinjiang produces 85 percent of Chinese cotton. July-August peak heat coincides with flowering and early boll development when cotton is most temperature-vulnerable. T2M_MAX days above 35C damage yield directly; China is the second-largest cotton producer so Xinjiang heat shocks tighten global supply balance.
HOW TO POSITION
Chinese supply overlay for Cotton via Xinjiang heat-stress channel. High Heat Stress firings flag bullish supply-shock setups via Chinese yield compression. Low Heat Stress firings flag bearish regimes. Pair with Xinjiang CHIRPS (precipitation), USDA PSD, India supply signals, and CFTC positioning.
WHAT THE CHART SHOWS
The composite sits at -0.572 in the Low Heat Stress band. NASA POWER T2M_MAX over Xinjiang has run below the rolling mean through late 2026 consistent with benign Chinese supply regime.
TOP INPUTS FIRING
- Primary composite -0.572 State Low Heat Stress, 15 days running in Neutral phase.
- NASA POWER Xinjiang T2M_MAX below trend Raw z-score -0.65; NASA POWER daily T2M_MAX heat-stress-day count over Xinjiang has run below trend through late 2026.
- Daily IC statistically significant, non-overlap sign-consistent Daily Spearman IC plus 0.064 at p-value 1.4e-07 statistically significant on full distribution. Non-overlap IC plus 0.144 at p-value 0.13 sign-consistent on 112 samples.
THE TAKEAWAY
What this means for you today
THE SUPPLY CALL
Composite -0.572, Low Heat Stress. NASA POWER over Xinjiang shows daily T2M_MAX heat-stress-day count running below trend through late 2026 consistent with benign Chinese supply regime. Signal firing in Low Heat Stress bucket for 15 days; forward 60-day edge in Phase -1 historically runs minus 10.44 percent fwd60d.
THE EMPIRICAL CONTEXT
Daily IC plus 0.064 at p-value 1.4e-07 statistically significant on 26-year sample. Phase +1 (High Heat Stress) delivers plus 6.97 percent fwd60d; Phase -1 (Low Heat Stress) delivers minus 10.44 percent fwd60d. 17.41 pp Phase +1 minus Phase -1 spread. Monotone phase pattern.
THE HONEST CAVEAT
Non-overlap IC at 60-day sampling plus 0.144 at p-value 0.13 sign-consistent but not independently significant on 112 samples. Signal most actionable during Jul-Aug peak-heat window. Xinjiang production is subject to Western sanctions regime (XPCC designations) which overlay separate supply-chain effects.
THE REGIME MAP
The three phases, forward returns and sample share
Computed from 6,676 post-warmup trading days (2000 onward). Phase +1 (High Heat Stress) delivers +6.97 percent fwd60d; Phase -1 (Low Heat Stress) delivers -10.44 percent fwd60d. Monotone phase pattern.
| State | Phase | Share | Fwd 60d | HAC t | Edge vs baseline | Last firings |
|---|---|---|---|---|---|---|
| High Heat Stress | +1 | 25.4% (1699 d) | +6.97% | +6.01pp | 2022 (China heatwave), 2010, 2006 | |
| Normal Temperatures | 0 | 7.8% (520 d) | +3.54% | +2.58pp | various | |
| Low Heat Stress TODAY | -1 | 66.8% (4457 d) | -10.44% | -5.52pp | 2026 (current), 2020, 2013 |
The historical pattern
Signature episodes in the 26-year sample
What this measures
Z-score of NASA POWER T2M_MAX heat-stress-day count (days above 35C) over China Xinjiang cotton region on a rolling 30-day window, tanh-bounded. Positive composite equals elevated heat stress equals bullish CT via Chinese yield compression. Target ICE US Cotton No. 2 first-nearby back-adjusted close.
Why it matters
Why Xinjiang heat matters
Xinjiang produces roughly 85 percent of Chinese cotton on irrigated acreage in the Tarim Basin and northern Xinjiang. July-August peak summer coincides with flowering and early boll development when cotton plants are most vulnerable to high-temperature damage. T2M_MAX days above 35 degrees Celsius during this window damage yield directly. China is the world’s second-largest cotton producer so Xinjiang-driven Chinese supply shifts transmit to global balance and Cotton futures via supply channel.
How to use this signal today
Chinese supply overlay for Cotton via the Xinjiang heat-stress channel. High Heat Stress firings flag bullish supply-shock setups via Chinese yield compression. Low Heat Stress firings flag bearish regimes where benign temperatures stabilize Chinese production. Pair with Xinjiang CHIRPS (precipitation complement), USDA PSD US production, India Vidarbha and Gujarat supply signals, Pakistan Punjab CHIRPS, and CFTC positioning for stacked global supply conviction.
Risk overlay
Daily IC statistically significant on 26-year sample but non-overlap test plus 0.144 at p-value 0.13 sign-consistent but not independently significant on 112 samples. Signal most actionable during Jul-Aug peak-heat window. Xinjiang production is subject to Western sanctions regime (XPCC designations) and Chinese government reserve policy (SRB stockpiling) which overlay separate supply-chain and price-support effects.
Signal consumers and siblings
Not investment advice · The analysis on this page is informational and educational. Signal readings, historical case figures, and empirical statistics are derived from publicly available data and are provided without warranty. Hypothetical performance results have inherent limitations, including the benefit of hindsight. Readers who intend to trade should consult a licensed investment professional and see the research brief for the full disclaimer.
Last refreshed Nov 06, 2026 10:00 AM ET