Analysis Of Cotton Prices Soaring In The First Half Of 2010

Cotton grower -

Crazy cotton prices

In 2010 1~6, China's cotton market staged an unprecedented price surge.

with

The revival of China's textile and garment industry has also led to the demand for cotton.

With the global economic recovery after the financial crisis, China's textile industry has been running smoothly since the first quarter of 2010. The added value has increased by 13.4% over the same period last year, and exports have maintained a relatively fast growth, and the domestic market continues to thrive.

But the supply of cotton did not keep up.

In the financial crisis, the demand for textile and clothing has shrunk sharply, resulting in a decline in demand for cotton and a sharp rise and fall in the cotton market. The average price of cotton in 2008~2009 is only 12159 yuan / ton, the lowest price in recent years, which has severely damaged cotton growers' enthusiasm for planting cotton. In addition, the increase in agricultural cost and labor costs have raised the cost of cotton production, resulting in a decline in cotton planting area and output in 2009.

At the same time, cotton imports accounted for 1/3 share of domestic output in the past, and at the same time, it also dropped significantly. Moreover, the main cotton producing areas in China suffered from low temperature, freezing injury, sand dust and hail, which resulted in delayed planting of cotton and weak growth of cotton seedlings. In 2010, the seedling situation in the middle of 4~5 was nearly 40% lower than that in the same period in 2009.

Especially in mid May, the main cotton producing areas in Northwest China suffered severe snow and hail weather, which threatened cotton production. The area of cotton harvest in Xinjiang and Bazhou was 140 thousand mu.

At the same time, the decrease of cotton seed comparative efficiency has led to the decline of farmers' enthusiasm for cotton growing.

According to the latest survey data from China Cotton Association, the cotton planting area in China was 77 million 100 thousand mu in 2010, down 0.93% from the previous year, resulting in a serious situation of cotton production increase in 2010.

China's cotton market this year (2009/2010) has the following 4 characteristics.

First, the gap between production and demand is 5 million 200 thousand tons, and the gap rate is around 45%.

2003/2004 cotton production 4 million 860 thousand tons, compared with the 6 million 250 thousand tons of consumer demand in the year gap of about 1 million 390 thousand tons, production and demand gap of 22.2%, resulting in soaring cotton prices.

As the late expansion of cotton imports (the import of 1 million 979 thousand tons in that year), supply and demand gradually balanced, cotton prices began to decline after May.

Cotton production in this year is 6 million 400 thousand tons (statistical bulletin data), a decrease of 1 million 100 thousand tons over the previous year, a decrease of 14.7%. It is estimated that consumption will be 11 million 600 thousand ~1190 million tons in the whole year, and the gap between production and demand will be more than 5 million 200 thousand tons, and the gap rate will reach 45%.