Financial Crisis Affecting Domestic Cotton Market Is Worrying.
The US financial crisis involving the US consumption patterns, financial regulation policies and the operation of financial institutions led to the US economic recession. The US economy accounted for nearly 30% of the world's total, and its imports accounted for 15% of world trade. Its recession will lead to a decline in global merchandise trade, thus affecting the export of some developing countries with large dependence on foreign trade. This has been evident in the cotton textile industry.
China's cotton yarn exports accounted for nearly 18% of the total output, cotton exports accounted for nearly 24% of the output, and export dependence was relatively large. According to customs statistics, in January 2008 -9, the export volume of textiles and clothing was 136 billion 976 million US dollars, an increase of 8.14% over the same period last year, and the growth rate was 11.9 percentage points lower than that of the same period last year. The export volume of clothing increased by only 1.78% over the same period last year, and the growth rate was 21.25 percentage points lower than that of 23.03% in the same period last year. In September, clothing exports showed a negative growth of 12 billion 60 million US dollars, down 3.2% from the same period last year.
As the "barometer" and "wind vane" of China's foreign trade exports just closed in November 6th, the total export turnover of the Canton Fair was 31 billion 550 million US dollars, down by 17.5% from the previous session, a drop of nearly 20%.
As of November 4th, a total of 2 billion 72 million US dollars were sold in the textile and clothing hall, a decrease of 2 billion 918 million yuan compared with the previous one, with a decrease of 58.48%. Among them, yarn, fabrics and products clinch a deal of 300 million US dollars, which is 85.98% lower than that of the previous paction of 2 billion 140 million yuan, and the clothing products category has been traded for 1 billion 219 million US dollars, which is 50.35% lower than that of the previous 2 billion 455 million US dollars. It is estimated that the export situation of textile and clothing will also become increasingly severe.
The increase in textile exports has dropped sharply, and garment exports continue to grow negatively. This is a bad news for the domestic cotton market. In November 7th, the domestic cotton standard class price was 11662 yuan / ton, compared with the beginning of this year, it dropped by 1891 yuan / ton, or 13.95%, and New York futures price fell to 42.01 cents / pound in December. Recently, the purchase price of cotton has been continuously lowered in some parts of the mainland. The lowest purchase price of 3 grade seed cotton is 2.23 yuan / kg, and the price of lint cotton is 9791 yuan / ton. Moreover, in 2008, labor costs rose and fertilizer prices rose and other factors greatly increased the cost of cotton planting. If cotton prices continue to fall, cotton farmers' interests will be seriously damaged, and will not be conducive to stabilizing cotton production next year.
The policy of purchasing and storing 1 million 220 thousand tons of cotton by the China cotton reserve management company is very good news for the cotton market. From the current market reaction, the 1 million 220 thousand tons of cotton purchasing and storage policy has effectively slowed down the trend of cotton prices falling rapidly. But to give the cotton market a strong agent and restore confidence in all aspects of the market, it is necessary for the state to further increase its policy to control cotton prices, protect the interests of cotton farmers, and take corresponding policies and measures to help textile enterprises tide over difficulties.
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