The report to the 19th National Congress of the Communist Party of China (CPC) called for adhering to the direction of Socialist market economy reform, allowing the market mechanism to play a decisive role in resource allocation, giving better play to the role of the government, optimizing industrial policies and perfecting the Macroeconomic regulation and control. 

It is an active exploration and successful practice for the government to bring into full play the role of the government by innovating the cotton industry Macroeconomic regulation and control mode, letting the market play a decisive role in cotton resource allocation and realizing the Macroeconomic regulation and control mechanism operation. 

Under the unified leadership of the National Development and Reform Commission and the Ministry of Finance, the National Cotton Reserve policy acts on the intermediate targets through such policy tools as market survey, joint meeting decision-making system and various meeting platforms, according to the goal of the reserve policy, reasonable guidance, scientific management of market expectations, regulation and guidance of cotton market activities, to achieve the policy objectives of rotation and storage. Since 2015 cotton year, the policy of national reserve round storage was carried out in an orderly way, the stock of reserve cotton was digested quickly, the cotton market ran smoothly, and the benefit of cotton textile increased greatly. 

First, the establishment of the Cotton Industry Macroeconomic Regulation and Control Planning and policy mechanisms. In the process of planning and formulating the policy of national storage and storage of cotton, the policy-making department, on the basis of comprehensive investigation and research, has the characteristics of sensitivity and efficiency in the light of macro-policy regulation and control, and follows the principles of foresight, scientificity, continuity and guidance, rationally grasp the balance between cotton supply and demand and the internal logic between industrial and commercial inventory and market changes, coordinate the relevant executive main scientific policy principles, the number, the time, the price.

 In the process of implementing the policy, closely follow and supervise the operation of the industrial chain, and evaluate the effectiveness of the policy in time. According to the market operation and the supply and demand trend, the central fiber bureau and Central Cotton Reserve Bureau, the main body of policy implementation, continuously optimize the national cotton reserve quality inspection force and the National Cotton Reserve warehouse resources allocation, to ensure that the rotation policy will be fully implemented in place. 

The Policy Department coordinates and adjusts the policy in time according to the target. Policy Planning, formulation, release, implementation, effect evaluation, whole course supervision and continuous optimization of policy mechanism operation system. The Macroeconomic regulation and Control Policy Planning and policy mechanism of the cotton industry constitute the core and main body of the Macroeconomic regulation and control mechanism. 

Second, the information platform as a carrier to build an effective Macroeconomic regulation and control mechanism. Market Mechanism is composed of price mechanism, supply and demand mechanism, competition mechanism and risk mechanism. 

Market price information can adjust production and circulation, and realize market allocation of resources. In the process of market competition, the level of commodity supply and demand and the effective dissemination of its information constitute a market expectation with certain influence. However, unexpected events beyond market expectations often lead to a large swing in market prices, which is not conducive to the smooth operation of the market. 

From the whole process from the brewing of the reserve cotton policy to the official announcement, the policy-making department, on the basis of the joint meeting of the reserve cotton policy, through different forms of meeting platforms and decision-making mechanisms, between the policy-making and the market main body, to form a fast and effective channel of information exchange. In view of the policy focus and the difficulty, through the information platform, enhances the exchange interaction, between the policy-making department and the industry and the market main body achieves the basic consensus, the reasonable guidance and the scientific management market anticipated, it reduces the asymmetry between policy and market. 

Through the policies and measures that the government can control and the relevant mechanisms indirectly affect the judgment and expectation of the cotton market main body on the market, the market main body thus forms the management decision, and maintains the stability of the overall market level of cotton, in promoting the economic growth of the cotton industry while reducing the economic cycle fluctuations. 

The information platform constitutes the "link" between the macro-prudential management mechanism system of cotton industry and becomes the carrier of macro-adjustment mechanism. The policies of the State Reserve and storage of cotton in turn scientifically grasp the internal linkage law of the operation of the Macroeconomic regulation and control, the information platform and the commodity market, innovate the macro-governance model of the cotton industry, and make the operation of the cotton Macroeconomic regulation and control step into a standardized, orderly and transparent track, to create an effective Macroeconomic regulation and control mechanism. Third, the development of an innovative round bottom price, so that the market in the allocation of state reserve cotton plays a decisive role. 

In the context of the global economic downturn and the increasing downward pressure on the domestic economy, the continuous release of state reserve cotton to the market on a large scale is bound to bring about an impact on the already fragile cotton market, thereby endangering the healthy development of the cotton and textile industries, the policy faces a dilemma. How to realize the effective delivery of national reserve cotton? It is the key to solve the problem to scientifically determine the daily turn rate and reasonably set the bottom price.

 The Policy Department innovates the pricing mechanism of the reserve price of the national cotton wheel, lets the market play a decisive role in the allocation of the national reserve cotton, and maintains the international competitive strength of domestic cotton textile enterprises, "determined dynamically in line with the market, in principle the bottom price of listed sales is linked to the spot price of cotton at home and abroad, determined by the weight of the spot price index of cotton in the domestic market and the spot price index of cotton in the international market, calculated by 50% each, adjusted once a week" , at the same time, the price difference between inside and outside of the cotton price formed an effective constraint. 

As a locomotive of cotton industry, the policy of rotation and storage has injected competitive strength into cotton textile industry, thus activating the cotton industry chain, which has received positive response from the market and the industry, the bottom line that there is no systemic risk in the cotton industry has been maintained. Fourth, the camera regulation, enhance the flexibility and accuracy of the policy. Volatility is an inherent feature of the market. Cotton has already become a kind of commodity futures trading at home and abroad. Besides the supply and demand of cotton market, there are a lot of factors related to finance. 

The operation of cotton market is full of complexity and uncertainty. While clearly formulating the relevant principles, the policy leaves appropriate space and layout for the pre-adjustment and fine-tuning of the later policy without losing the flexibility. In response to the new changes in the market, the policy maximum timely provision of new tools to respond to the camera control. Policy departments closely follow the market situation, remain vigilant to emerging issues, be prepared for potential risks, respond to market concerns in a timely manner, stabilize market expectations and enhance market consensus. Between the national reserve cotton and the market, has realized the optimization quality structure and the scale quantity accurate double match, has guaranteed the policy controllable and the high efficiency.