There Are Still Uncertain Factors For Cotton Planting Income: &Nbsp; Raw Material Production And Marketing Of Textile Enterprises Are Affected.

After the financial crisis, with the recovery of the world economy, China

First, the influence of the main body's income under the fluctuation of high cotton prices.

1, there are still uncertainties in raising farmers' cotton yields.

It is generally believed that after the new cotton market came into being, cotton farmers' income from cotton planting could be raised with the increase of cotton purchase price.

This year

The survey shows that despite the substantial increase in cotton prices this year, the income of farmers

2, processing and circulation business risk increased

Cotton processing and circulation enterprises are in the middle of the industrial chain. Cotton is in short supply this year, the price fluctuates sharply, which brings huge profits to the enterprises, but also brings greater business risks.

The profit of the processing enterprise depends mainly on the selling price of the lint and the purchase price of the seed cotton. If the market price is relatively stable, the income of the processing enterprise is stable.

If the market price fluctuates greatly, the processing enterprise can get the price difference profit or loss.

At the end of September, the purchase price of seed cotton is 5 yuan / kg, and the price of lint cotton is 22738 yuan / ton. If the enterprise buys seed cotton at this time to process, the product will be sold to the end of October, and its selling price will be 26760 yuan / ton (328 grade), so that every 1 ton enterprise can get 4022 yuan income.

However, if the price of seed cotton is purchased at a high price of 6.1 yuan / Jin in mid and late 10, the price of lint cotton will reach 26630 yuan / ton, and it will be sold again after 1 months of storage. Because of the fall in cotton prices during the period, the sales price has dropped to 26500 yuan / ton, so that enterprises can not only get high profits or even serious losses.

3, textile enterprises profit and risk coexist

This round of cotton price increase is mainly driven by demand. After the financial crisis, cotton textile industry has resumed development, cotton and cotton yarn have been flourishing, and yarn price and cotton price have basically increased simultaneously. From October 2009 to October 2010, the prices of grade 328 cotton and 32 yarn have increased by 80% and 81.9% respectively. Reasonable price difference has made textile enterprises get better returns.

The survey shows that the cost of producing 1 tons of cotton yarn (32 branches) is 5030 yuan, the cost of raw materials is 29000 yuan, the sales price of cotton yarn is 39000 yuan, the profit per ton yarn is 4970 yuan, and the profit margin is 14.6%, which is 7 percentage points higher than that of last year (see Table 3).

Nevertheless, because of the fluctuation of market prices, the speculation of the main bodies such as processing enterprises and social capital has stimulated the purchasing of raw materials in textile enterprises, which has affected the production and operation of textile enterprises to a certain extent.

At the same time, the business risk is increasing and facing the risk of high and low risk, that is, the price of cotton yarn is upside down with the price of cotton.

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Two, the impact of severe price fluctuations on the development of cotton industry.

The sharp fluctuation of cotton prices is not conducive to the healthy development of the industrial chain.

On the one hand, it is difficult for cotton growers to grasp the trend of cotton prices and make it difficult to make correct production decisions, which may lead to imbalance in supply and demand of cotton in the coming year and trigger a new round of market fluctuations.

On the other hand, price fluctuations can easily lead to speculation in processing enterprises, exacerbating the strain of cotton resources, and affecting raw material supply and production and operation of textile enterprises.

From the cotton farmers' perspective, this year's high cotton price has given farmers a good expectation, and farmers' cotton planting intention has increased.

In the survey, many farmers have reserved cotton fields next year, and some farmers are also preparing to expand their planting area.

Cotton farmers blindly expand their planting area may lead to a fall in cotton prices next year.

Farmers often lag behind in the price pmission. Farmers decide the planting area of cotton next year according to the current price. Therefore, the large price shocks have affected the cotton farmers' income, thereby losing their confidence in the market and not conducive to stabilizing cotton production.

The fluctuation of cotton prices is also not conducive to the development of cotton processing enterprises. Enterprises are faced with high and low losses, and business risks are increasing.

Because the investment scale of the processing enterprise is relatively small, the process technology is relatively simple and the production cycle is short, so if the fast forward and fast come out, the enterprise can lower the risk to a lower level and obtain the basic income.

However, if the market price continues to rise, enterprises will gain more income by selling cotton one day later, thus inducing enterprises' speculative behavior and delaying sales time so as to obtain price difference earnings.

However, if most enterprises take this kind of speculation, the market price volatility will likely be exacerbated in the short term.

The severe fluctuation of price has great influence on textile enterprises.

Because the price changes of downstream products are relatively lagging behind, with a smaller margin.

According to our survey of Hebei textile enterprise Changshan stock (000158, stock bar), this year due to the corresponding rise in cotton yarn prices, to a large extent offset the increase in the use cost of lint materials, but the profit growth of enterprises mainly benefited from correct production decisions.

When the lint price exceeds 28000 yuan, the enterprise did not rush to buy cotton, so the average import cost of raw materials was controlled at 26000 yuan. When the price of cotton yarn rose all the way, no product was hoarded, but the speed of product sales was accelerated, which made the cotton raw materials purchased at low price in the early stage get a better sales price, thus making the profit margin of the whole enterprise rise significantly.

Generally speaking, cotton farmers are the biggest victims of market fluctuations, because cotton farmers' income is directly related to prices, and cotton farmers have the least market information, the most lagging behind, and the weakest ability to resist market risks. Therefore, they are often unable to sell high prices and bear low prices.

Three, policy recommendations

Although the main products of the industrial chain have been well received under the high cotton price, the stability of prices is the basis for promoting the long-term and stable development of the cotton industry chain. The corresponding policy measures should be adopted as soon as possible to stabilize the cotton prices and maintain the healthy development of the cotton industry.

First, the minimum purchase price policy for cotton will be introduced as soon as possible.

There are many reasons for the fluctuation of cotton prices this year, but the most fundamental is the first two years, especially in 2008, the purchase price of seed cotton has been greatly reduced, cotton farmers' income has been reduced, cotton planting enthusiasm has been seriously affected, and cotton production has been on the decline.

This year, the gap between supply and demand of cotton has stimulated the speculation in the market.

As cotton planting is time-consuming and labor intensive, with the expansion of cotton farmers' income sources and the increase of their income level, cotton growers' enthusiasm for planting cotton is decreasing. If cotton prices can not be maintained at a reasonable level, the trend of cotton production will be reduced.

China is a large textile country. Textile has strong international competitiveness, and the demand for raw materials for cotton is still large.

Therefore, the minimum purchase price of cotton should be issued as soon as possible, giving cotton growers a steady income expectation, keeping cotton planting enthusiasm, stabilizing domestic supply of cotton and ensuring the development of textile industry.

Second, regulate market circulation and processing, and prevent speculation.

We should intensify the implementation of the cotton quality inspection reform, speed up the withdrawal of small cotton ginning machines from the market, raise the entry threshold for processing industry, avoid overcapacity and excessive competition in the processing industry, and create unfair competition in the market.

We should standardize market order, crack down on malicious speculation and disrupt market order, and maintain a stable supply and marketing relationship between cotton growers, processing enterprises and textile enterprises.

Third, we should improve the monitoring system of cotton market and issue timely cotton supply and demand information.

At present, there is no accurate and timely publication of cotton production information, resulting in blind market players.

In particular, this year's supply and demand gap has been enlarged, which has become the operational theme of the futures market and has been pmitted to the spot market, causing speculation.

Therefore, we must establish and improve the cotton market monitoring system, especially the tracking and monitoring of cotton production situation, increase input, ensure timely and accurate information, and strengthen the follow-up study of cotton consumption trends, thus forming a more scientific report on cotton supply and demand balance for reference by market participants and policy control departments.