Market Focus: What Is The Inventory And Future Market Of Textile Enterprises?

At present, there is still a period of time from the new cotton market. With the continuous high operation of cotton prices, the sale of national cotton reserves is expected to increase. So how much can real estate cotton, Xinjiang cotton and imported cotton have for consumption? How about the inventory and future market of textile enterprises? Whether these new and old cotton can be successfully alternated? These problems have become the focus of the market.

National cotton reserves

In the near future, with the enhancement of the expectation of policy regulation, the sentiment of the cotton market is warming up again. The market is paying close attention to the trend of the national storage of cotton.

In June 25th, the relevant departments said that the plan for selling 600 thousand tons of state cotton and cotton stores has been approved, and the trading rules have also been completed, and can be started at any time according to market needs.

In July 27th, relevant departments of the State met again to discuss cotton throwing and storing.

In July 30th, the China Cotton Textile Industry Association and the national cotton trading market jointly issued the "notice to examine the qualification to participate in the auction of cotton reserves", and again confirmed that the sale of state cotton and cotton has entered the final countdown stage.

The announcement indicates that the purchase object is limited to the textile cotton enterprise, and the maximum purchase quantity is approved according to the principle of purchasing cotton for 1 months at most, and the reserve cotton purchased is limited to its own use and must not be sold.

However, there is still no clear news about the specific way of selling cotton, which includes selling time, selling quantity, selling price and selling price limit.

The details of the sell-off are not clear. Most of the textile enterprises have a wait-and-see attitude and are waiting for the clear policy of the State Cotton store sale. This makes the policy factors be digested ahead of time, which is conducive to the stability of cotton prices.

domestic

Cotton sales in this year are faster than the same period in previous years. According to the national cotton market monitoring system, as of July 16th, China's lint sales rate was 96.1%, an increase of 15.8 percentage points over the past 3 years.

Due to insufficient domestic resources and a significant increase in cotton imports, the cotton year has imported 2 million 100 thousand tons of cotton, an increase of 890 thousand tons over the same period last year.

According to the statistics of Xinjiang railway department, as of the end of July, the total inventory of cotton within the territory was less than 200 thousand tons, of which about 120 thousand tons were cotton reserves.

According to feedback from the cotton market in the mainland, most of the cotton enterprises are out of stock at present, and they are preparing for the acquisition of new cotton. At the same time, some small and medium-sized cotton enterprises and some international cotton traders have begun to increase the sale of lint. However, there are still a few large cotton producers who are optimistic about the August market.

Generally speaking, the quantity of lint available for sale in domestic cotton market is still limited, and the pattern of tight supply and demand in cotton market will hardly change in the near future.

International cotton market is limited, so China can hardly import large quantities.

In order to meet the needs of textile enterprises and stabilize the domestic cotton market, the departments concerned re issued 600 thousand tons of imported cotton quota in June, and the total quota has reached 3 million 600 thousand tons this year, the highest in history.

However, due to the insufficient resources of the international cotton market, the textile enterprises this year have ample quotas, and the difficulty of ordering is increasing. The volume of imports has declined for two consecutive months.

Judging from the current supply of cotton in the northern hemisphere, besides the cotton that has been signed but not shipped in the early part of India, the supply of goods has been almost exhausted.

This can be seen from the Cotlook index that reflects the trend of international cotton spot prices.

Since June 23rd, the Cotlook A index has been unable to generate because of the lack of quotations for generating indices. This is rarely seen in history.

In addition, several US cotton cooperatives did not offer quotes for high-grade cotton.

It is understood that only the southern hemisphere cotton producing countries are currently able to offer the latest shipment. However, most of the Australian cotton has been sold out, and the output of Paraguay is too small. The grade of Argentina cotton export is relatively low, and only Brazil cotton can be considered.

On the whole, imported cotton will be cotton and India cotton before the end of the year, but there is still a variable in the smooth export of India cotton.

downstream

Since July, textile enterprises have entered a low sales season.

Through the current cotton market turnover situation, although cotton enterprises are eager to sell, but the textile enterprises will not have a strong desire to deal, and there are some small businesses that have the intention to bargain. Large textile enterprises are expected to purchase products because of sufficient inventory and the selling of national cotton stores, so that the market is in a downturn.

At present, yarn prices have begun to enter the downturn channel, but after a few months of best-selling situation, spinning enterprises generally do not have big financial pressure.

The quantity of cotton that cotton textile enterprises have already bought and entered into our warehouse is not large, but with cotton, which is on the way, ordered and stored in other warehouses, the quantity of cotton that the cotton textile enterprises can actually control is mostly in 2-3 months' production volume, and many large enterprises are even more.

Considering from the textile enterprises themselves, although the imported cotton has signed the contract, there are many uncertain factors such as the long journey and the shipping date. Therefore, when the national cotton store is sold, it is still a matter of concern to the enterprises.

Estimated shortfall of cotton market supply in the new year

The supply and demand changes of global cotton in the new year are still concentrated in China, the United States and India.

In the US market, the output is expected to increase to 3 million 980 thousand tons in the late weather. Considering the end of this year, the inventory will be reduced by about 750 thousand tons compared with the previous year. The new year will not exceed 600 thousand tons of effective global supply. India will also increase its demand for cotton and increase the global supply by no more than 300 thousand tons in the new year.

For China's cotton production, the current institutions are divided. The US Department of agriculture's latest forecast is 7 million 180 thousand tons, the ICAC forecast is 7 million 80 thousand tons, and the China Cotton Association forecast is about 6 million 700 thousand tons.

Combined with the output of the National Bureau of statistics last year, 6 million 400 thousand tons, plus the weather this year, China's cotton output will not exceed 6 million 400 thousand tons last year.

If not expected, the forecasts of the agencies will gradually move closer to this figure.

The new cotton year will continue to maintain a tight supply pattern.

China's cotton production is expected to be relatively low in the new year. This year, during the cotton planting season, there was a low temperature in Xinjiang and the Yellow River basin, and the sowing time was delayed.

Because the pre harvest peach, peach and autumn peach account for 15%, 50%-60% and 25% of the cotton yield respectively, even if the weather has been beneficial to the growth of cotton peach in 8 and September, the output of cotton will also be about 85% of the normal year.

To sum up, despite the fact that there are not many cotton lint available for sale in cotton market, the risk of cotton selling is loosening because of the increasing risk of cotton storage.

As the textile industry has entered the traditional off-season, the sales of finished products have slowed down, and the enthusiasm of purchasing cotton has also declined.

At the same time, when the cotton price is rising in the early stage, the textile enterprises are relatively adequate stocking, and the sale of national cotton and cotton will increase the short term supply of cotton market. Therefore, the cotton price at the end of this year is expected to achieve a smooth pition.