Cotton Prices Fluctuate &Nbsp, "Skyrocketing And Plummeting" To Increase Market Risk

After the launch of new cotton in 2010, prices rose all the way, but the price went down in mid November.

The stability of cotton production is not only related to the interests of farmers, but also important for the healthy development of processing enterprises and downstream textile industries.

This year

A farmer:

As of November 22nd closing, the Zhengzhou futures exchange cotton main contract CF1105 closed at 25225 yuan / ton, from the highest price in November 10th 33720 yuan / ton fell 25.2%.

Subsequently, cotton prices have been lingering low, entering the early December, prices have been warmer.

In fact, before the cotton price went down, cotton prices in the whole country in 2010 had been rising up to a record high.

The "China rural policy implementation report 2010" released by the Ministry of agriculture's Rural Economic Research Center said that from 1 to October this year, the average monthly price of the 328 grade cotton rose from 24701 yuan / ton to 14932 yuan / ton, or 80.9%.

The price of cotton rose to a roller coaster ride.

Cotton farmers have no choice but to buy enterprises at a loss.

Song Kui Lins is in Wangjiazhuang village, Xuzhuang Township, Jizhou City, Hebei province. More than 90% of the farmers in this village grow cotton.

Song Kuilin planted 23 Mu this year and produced more than 10 thousand jin of cotton. By the beginning of November, all of them had been picked up.

In early October, he sold 3500 Jin at the price of 4.3 yuan per catty, although the price was 1 yuan higher than that of last year, but cotton prices rose one day after a day, which made him regret selling himself early.

In the first ten days of November, when the catty price was close to 7 yuan, he basically sold the remaining cotton in his hands. After a few days, the purchase price of cotton began to fall, and the farmers who had not yet sold the village began to "regret".

Song Kuilin said, "now the cost of one mu of cotton is six hundred or seven hundred yuan without labor cost. We are definitely looking forward to the higher price, but it will be too much for a while to fall. What we want most is a stable price."

In November 10th, the price of seed cotton in Li Town, Shayang County, Hubei province was 7 yuan per catty.

Zhou Wenqing, the two group of farmers in Peng Ling village, missed the opportunity to work in Qianjiang, and most of the farmers in the village brushed away with this "peak price".

The price will then plunge at a rate of 0.5 yuan per day.

In November 30th, the price of local seed cotton dropped to 4.8 yuan per catty. Zhou Wenqing said the price was acceptable, but he expressed concern about cotton cultivation next year.

Stable prices are also Hengshui profits.

Experts: there are reasonable factors for the rise in cotton prices, but "skyrocketing" will increase market risk.

In an interview with reporters, insiders said that the causes of the rise in cotton prices in 2010 were complicated, with reasonable factors, but also with the characteristics of inflation and irrational price speculation.

First, production is insufficient, and supply and demand of cotton are tight.

This year's frequent occurrence of disastrous weather, the main cotton producing areas generally reduced production.

The domestic lint yield is estimated to be about 6 million 400 thousand tons, but the consumption is about 10 million 800 thousand tons, and the gap between production and demand is about 4 million 400 thousand tons.

Global production and demand is also in a tight balance.

Secondly, the cost of cotton growing is increasing, and the comparative efficiency is decreasing. Cotton price has intrinsic reasonable value to return to demand.

In recent years, with the increase of labor force and other factors of production prices, the cost of seed cotton is increasing.

At the same time, compared with planting grain or other crops, the yield of seed cotton is relatively low.

Experts said that if grain and cotton prices were too low, it would further hurt farmers' enthusiasm for cotton planting next year.

In addition, the expected price increase of raw materials, the intensified competition of multiple acquisitions, and the speculation of some speculative funds and social hot money have also contributed to the rise in cotton prices.

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According to the news, the volume of the whole cotton textile industry chain is generally shrinking due to the rising price in the previous period. Meanwhile, because of the severe fluctuation of price, cotton spinning enterprises are afraid to take large single or forward orders.

At present, the middle and downstream manufacturers are worried about the risk after high price purchase, part of the weaving enterprises or reduce the start-up rate, or only produce orders.

Recently, the national development and Reform Commission, the Ministry of agriculture, the China Agricultural Development Bank and other 7 departments jointly held the national cotton work teleconference meeting that cotton prices in the short term too fast excessive rise, containing a greater market risk.

Analysis of the industry, cotton prices rose too fast some time ago, has appeared virtual high, recuperation of course.

However, experts also reminded that the cotton price has plummeted in recent 2003 years, which is very unfavorable for the healthy development of cotton and textile industry. Such lessons should be learned.

Policy: mobilizing farmers' enthusiasm for production and stabilizing cotton production

At present, China's cotton production is facing new situations and new problems. Experts use three "bigger and bigger" generalizations.

First of all, the pressure of cotton supply is increasing. Secondly, the competition pressure of outer cotton is bigger and bigger. Third, it is more and more difficult to stabilize production.

From the development trend, the contradiction between the growth of cotton demand and the shortage of domestic supply will exist for a long time. If the cotton supply is too dependent on the international market, it will not be conducive to the healthy development of China's cotton textile industry.

Although cotton prices have risen more in recent years, they are still relatively low compared with grain prices, and the low level of mechanization of seed cotton, time consuming and labor consuming, and great market risks make it difficult to stabilize cotton production.

Experts pointed out that we should focus on ensuring the basic balance between supply and demand of cotton and promoting stable development of cotton production, protecting cotton farmers' interests, protecting cotton needs, stabilizing market cotton prices, standardizing circulation order, and preventing and controlling operational risks.

At the 2010 National Cotton Conference, the Ministry of Agriculture said it would take effective measures to prevent cotton production from sliding.

On the basis of steadily expanding the cotton planting area in the dominant area, we should strive to improve cotton yield and quality.

We will continue to improve cotton production conditions and increase support for the Yellow River River Basin, Yangtze River Basin and Xinjiang high quality cotton production base.

In the cotton producing areas, the agricultural sector should speed up the selection, demonstration and popularization of new cotton varieties and update the cotton varieties, expand the planting scale of high-quality cotton and improve the quality of cotton.

In order to stabilize the cotton industry development, the state greatly increased the subsidy funds for cotton varieties. In 2010, the central finance had pre allocated 1 billion 270 million yuan of cotton seed subsidy funds; vigorously supported the high yield of cotton creation. In 2009 and 2010, the central finance arranged a high yield of 40 million yuan for high yield of cotton; increased the support of cotton agricultural insurance. In 2010, the central financial arrangement of cotton insurance premiums was 750 million yuan, the coverage of cotton insurance was continuously improved, and the coverage of cotton insurance coverage in Xinjiang and other main cotton producing areas had exceeded 80%.

In order to ensure that cotton farmers can harvest cotton in a timely manner, as of the end of 10, the Agricultural Development Bank has identified 713 enterprises have the 2010 annual acquisition loan qualifications, basically covering cotton production areas, and facilitate cotton farmers to sell cotton.

As of early November, the bank issued a total of 27 billion 491 million yuan of cotton purchase loans, supporting the acquisition of 22 million 707 thousand and 100 cotton lint.

Among them, Xinjiang has issued a total purchase loan of 18 billion 5 million yuan, supporting the acquisition of 13 million 322 thousand and 300 cotton lint.

Considering that the cotton market in 2010 was postponed for 10 days compared with last year and cotton prices rose sharply, the amount of cotton purchase loans released by the new year in the new year was 3 billion 727 million yuan more than that in late October last year.