Uzbekistan has implemented new regulations under a presidential decree to enhance market mechanisms for raw cotton production and sales. Beginning with the 2025 harvest, the initial price of raw cotton will be determined by the average futures quotations for cotton fiber on the New York Stock Exchange over the past six months.

The decree outlines key measures for market operations:

1. Price Setting:
   • On November 1 of each year (February 1 for the 2025 harvest), the Uzbekistan Republican Commodity Exchange will determine and publish the starting price of raw cotton (first grade, second class) for the next year’s harvest.
2. Contracting System:
   • Futures, forward, and spot contracts for raw cotton will be concluded based on regional trading results.
   • Contracts between producers and processors will be executed via exchange trades, allowing producers to select delivery times and buyers independently.
3. Contract Types:
   • Futures contracts: Concluded freely on the exchange between producers and processors, with prices not falling below the announced starting price, from November 1 to June 1.
   • Forward contracts: Agreed upon between producers and processors from November 1 to March 1.
   • Spot contracts: Agreed upon for specific raw cotton volumes.
4. Support for Farmers:
   • Producers growing cotton with their funds or commercial loans and selling it on the exchange will receive a 10% subsidy on the invoice value.
   • Subsidies will cover 4 percentage points of interest on preferential loans for cotton cultivation if repaid by the year-end (December 31).

These measures aim to establish a transparent market environment, encourage competition, and support Uzbekistan’s agricultural sector in aligning with global standards.