Thoughts On The Rise And Fall Of Cotton Prices

In the past few years, cotton prices were relatively stable, but in 2010 cotton prices did not rise for 10 years.

Although the "cotton mad" has passed, will it come back again? Therefore, it is necessary for us to make a careful analysis and Study on the mechanism and influence of the "cotton crazy" disease, and on this basis, put forward specific measures to prevent the recurrence of "cotton mad" and ensure the steady development of China's cotton industry.

2010

Cotton prices were relatively stable in the past few years, but in 2010 cotton prices appeared to be crazy like crazy.

From 2006 to 2007, cotton prices had been hovering between 10000 yuan and 11000 yuan per ton. In 2008, due to the impact of the international financial crisis, cotton prices were sluggish. In order to protect cotton farmers' enthusiasm for planting cotton, the state carried out large-scale storage and storage. At that time, the price of cotton storage and storage was 12000 yuan / ton, plus 600 yuan subsidy.

With the rise of price level, compared to grain and other staple agricultural products, cotton prices in 2009 were still rising at a relatively low level, but the fluctuation was not large, which had dampened cotton growers' enthusiasm for planting cotton.

By September, when the new cotton came into the market in 2010, cotton prices were similar to those of mad people.

Seed cotton purchase price from 8.4 yuan / kg to nearly 15 yuan / kg in November, three months to 78.6%, seed cotton acquisition the highest in history, and lint sales price rose from 18000 yuan / ton in September to 32000 yuan / ton in early November, 77.8% in three months, and also the highest in lint sale price.

In late November, the purchase price of seed cotton plummeted. By the end of December, the purchase price of seed cotton remained at 12 yuan / kg, and the sale price of lint remained at 28000 yuan / ton.

This round "

The sharp rise and fall of cotton prices not only increased the risk of the market, but also had a negative impact on the stability of the cotton industry.

For cotton farmers, cotton processing enterprises, cotton textile enterprises are no good.

(1) for cotton growers to grow cotton.

Cotton inflation will to some extent.

(two) for cotton processing enterprises.

With the liberalization of the cotton market, seed cotton is directly sold to processing enterprises by cotton growers. Now it has gradually become a self-employed household, buying seeds and cotton seeds and selling them to cotton processing enterprises.

Individual peddlers have a flexible mind and a wide range of activities. They are more sensitive to the price, and whose price is high and cotton is sold to anyone. The processing enterprise bears the risk of high cotton price.

Because cotton processing has a lagging nature, it is impossible to manufacture and sell immediately after the acquisition.

Some enterprises buy cotton seeds at a high price, and cotton prices plummeted at the time of sale, resulting in huge losses.

There are few cotton processing enterprises this year because of the record high cotton prices and huge profits. On the contrary, the profit margins are small and some even face the risk of loss.

(three) for textile enterprises.

As cotton prices rose, cotton yarn prices also rose rapidly.

The 32 pure cotton yarn of combed yarn rose from 26200 yuan / ton in early September to the highest in mid November, and its mainstream price reached 42500 yuan / ton, up 16300 yuan, or 62%.

By November 15th, with the sharp fall in cotton prices, the price of yarn has also dropped, and the entire cotton textile industry chain is in a serious wait-and-see. Clothing companies dare not take orders. Weaving enterprises are not actively buying yarn, so cotton yarn is seriously unsalable and inventory is increasing.

Some textile enterprises with low grade and low added value will have a hard time, and cotton spinning industry is labor-intensive, and the cost of labor is increasing. The cotton spinning industry will have a new situation of reshuffle and survival of the fittest.

The main reason for the sharp rise and fall of cotton

(1) from the supply of cotton, many factors have reduced the supply of cotton, exacerbating the imbalance between supply and demand.

1. the comparative benefit of planting cotton has declined, which has frustrated cotton growers' enthusiasm for planting cotton and reduced the supply of cotton.

As a staple agricultural product, cotton prices have been in a doldrums in the past few years, and the price of economic crops such as grain and vegetables has increased one after another, which makes the comparative benefit of planting cotton lower, and the cost of cotton growing is increasing day by day, which has frustrated cotton growers' initiative in planting cotton.

From 2007 to 2009, cotton planting area and total output decreased year by year.

Because of low price and reduced production, the contradiction between supply and demand of cotton is aggravated.

2. the related subsidy policy of the state is not in place, which also affects cotton farmers' enthusiasm for planting cotton to a certain extent.

There are varieties of grain subsidies, grain subsidies and comprehensive subsidies for agricultural products. Some developed areas have other supporting measures, with a total subsidy of nearly 100 yuan per mu.

And only 15 yuan per mu of seed cotton subsidies.

Obviously, the country's subsidy policy has also dampened the enthusiasm of cotton planting in varying degrees.

3. the impact of natural disasters led to a large reduction in production, thereby reducing the supply of cotton.

In 2010, the main cotton producing areas in eastern China were seriously affected. During the cotton pollination period, the rain and rain in Hebei, Hubei, Anhui and other places affected the quality and quantity of the peach, and at the same time, many provinces in southern China suffered huge floods, resulting in the reduction of cotton production in China.

According to statistics from relevant departments, the cotton planting area in 2010 was 75 million 680 thousand mu, 1.1% less than that in the previous year. The output per unit area was 84 kg / mu, a decrease of 4.4%, and the total output of 6 million 360 thousand tons was reduced by 5.5%.

4. the international cotton disaster and the impeded import of cotton also reduced the supply of China's cotton market.

According to reports, the main cotton producing areas in 2010 were affected by disaster factors and output declined.

From July 2010 to August, Pakistan suffered an unusually large flood in the past century, and cotton production was reduced by nearly 30%.

India even restricted the export of cotton, which aggravated the supply of China's cotton market.

To sum up, there has been a long-term formation of low cotton prices and policy factors affecting the enthusiasm of planting cotton, and superimposed on the natural disasters at home and abroad in the year, resulting in serious shortage of cotton in China in 2010.

(two) from the needs of cotton, China's cotton textile industry has been in serious overcapacity. The world financial crisis has had an impact on China's textile industry. But with the crisis, the textile industry began to pick up in 2010, and the increase in orders increased cotton demand.

Data show that from January 2010 to August, China's textile and clothing exports increased by 23.75% over the same period, and basically recovered to the level before the crisis.

China is a large textile country. The cotton textile industry has been developing rapidly for 10 consecutive years, with an annual growth of 17%. The number of yarn spun has exceeded 120 million. The annual cotton consumption accounts for 80% of the global market. Because of the low price of cotton in recent years and the huge profits of textile enterprises, textile enterprises have been expanding blindly in recent years, and even many textile companies that have been abandoned for many years have started production and increased their cotton consumption.

Since 2006, it has broken through 10 million tons, and the output of domestic cotton is unable to meet the demand, thus becoming a rigid contradiction, and the gap between supply and demand is bigger and bigger.

(three) international speculators manipulate international cotton prices, which has contributed to the rising price of cotton in China.

Due to years of reform and opening up, China's cotton prices have basically been in line with international standards.

International speculators see that China is a big cotton consuming country, making use of the opportunity of global cotton production reduction to keep the international cotton price at a high level, and foreshadow the crazy rise of cotton prices in China.

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(four) immature futures market has become a powerful promoter in the current cotton boom.

In the past few years, in the face of the global financial crisis, the state invested 4 trillion yuan to stimulate economic growth. Such a huge capital far exceeds the needs of the real economy.

Just like humans, when you enter blood that exceeds the body's needs, there will be edema on your face or on your body.

The same is true of the economy. Excess capital flows into the real estate market and house prices rise. Similarly, the flow into the cotton market will make the cotton futures market go up wildly.

As a large number of investors put money into the cotton futures market and bought more bills, futures prices rose, and spot prices also rose.

Since the futures market is not like the spot market, it can start several times of goods with enough margin.

Data show that from 2010 to October July, Zheng cotton rose 50%, and gained 5 times of the Zheng cotton contract, increased 87% from November cotton to November, and gained 8 times of Zheng cotton contract.

In this round of cotton boom, the most profitable investors in the futures market.

(five) the limited capacity of the state's macroeconomic regulation and control has made it possible for the cotton boom to rise.

Before this round of cotton boom, the state has issued millions of tons of state treasury cotton to stabilize cotton growth momentum, but because of limited state treasury cotton, it has not been able to effectively curb the cotton crazy rise.

Measures to deal with the sharp rise and fall of cotton prices

Through the above analysis and research, we find out many factors of the sharp rise and fall of cotton in this round, and we will find out the countermeasures and measures to solve the problem.

(1) the state has increased investment to stabilize the cotton planting area, and strive to increase its yield per unit area, thereby increasing its total output.

The state should consider the long-term consideration and introduce relevant policies to stabilize the cotton planting area and increase the total output. At the same time, we should increase the investment in science and technology, especially the cultivation and popularization of high quality and high yield cotton seeds, and increase the output per unit through scientific and technological innovation.

To protect the domestic cotton rate of not less than 70%, so as to safeguard the safety of the entire textile industry.

It is understood that the United States cotton farmers enjoy the government's subsidy of up to 89%, that is, the government subsidies of US $100 per US $100, effectively protecting the stable production of cotton in the United States.

(two) to introduce a regular storage and storage system, stabilize cotton prices, and effectively protect cotton farmers' enthusiasm for planting cotton.

The state should introduce a regular purchasing and storage system, and publish the lowest protection price in advance according to the price level of different cotton prices.

Once the cotton price is lower than the minimum protective price, the state immediately starts the purchase and storage plan, and opens up the purchase to protect cotton production and avoid the phenomenon of cotton injury. Once the cotton price rises, the state sells cotton reserves to stabilize the cotton market price and avoid the high cotton price and hurt the textile industry.

(three) speed up the establishment of the cotton logistics system, especially the construction of warehousing and pportation in the main cotton producing areas.

First of all, we should improve the cotton storage construction in the main cotton producing areas, ensure that cotton can be stored safely, and provide a guarantee for the cotton storage and storage system.

Secondly, we should strengthen the construction of pportation facilities in the main cotton producing areas, ensure that cotton in main production areas will be pported to the consumption areas in time, and timely control the fluctuation of cotton prices in local areas and the impact on the whole cotton market.

(four) vigorously utilize the social capital to develop the specialized warehouse of cotton and give full play to the function of the bank's mortgage loan, so as to ensure that the cotton enterprises have enough funds to purchase cotton.

The cotton which has been notarized by the state has been sent to the designated professional warehouses for storage and custody under the condition of the voluntary and ownership of the enterprise. The designated warehouse is a third party warehouse. The bank can be used as a mortgage loan to reduce the bank risk and provide sufficient funds for the cotton processing enterprises. At the same time, the cotton can be supervised to ensure that the cotton will not be counterfeited or exchanged after inspection.

(five) publish official information on cotton production, consumption, import and export in a timely and accurate manner.

A perfect market economy must be supported by perfect information.

The state should set up official information about cotton production, consumption, import and export, so as to collect, arrange and publish in time and accurately, which is very important for stabilizing the cotton market.

(six) unswervingly push forward the reform of the cotton inspection system to ensure that the cotton industry policy is put in place.

In accordance with the requirements of the national development and Reform Commission, we will continue to promote the reform of the cotton inspection system. We must resolutely clamp down the small roller and small sawtooth with backward processing equipment, poor processing technology, and quit the market for the 200 ton processing enterprises that do not conform to the cotton industry policy as soon as possible, so as to avoid competing for limited cotton flower resources.

The state can subsidize cotton by way of the 400 type processing enterprise, and calculate the cotton quantity according to the cotton quantity checked.

This will not only increase the coverage rate of the cotton notarization test, so that the state can grasp the quantity and quality of cotton accurately, provide the basis for macroeconomic regulation and control, and promote the reform of cotton circulation system more effectively, so that cotton resources can flow into the 400 type processing enterprises with better technology and equipment.

(seven) improve the cotton import and export management system.

The quota management of import and export of agricultural products is necessary for stabilizing domestic agricultural production in a country.

However, due to the fact that cotton production in China is not self sufficient, it is necessary for the country to import.

Therefore, it is very necessary for the management of quotas and timely distribution of enterprises that need to import cotton to ensure that enterprises choose suitable import opportunities according to market conditions, which is very necessary for stabilizing domestic cotton market.

(eight) the textile industry must carry out structural adjustment, reduce excess capacity, and strive to build its own brand and increase the added value of its products.

One of the reasons for this boom is that China's textile industry has overcapacity, even if the production of more cotton, imports can not meet the demand.

Therefore, textile industry must carry out structural adjustment so that products can be pformed from low-grade and extensive to high-grade and fine. Therefore, a group of textile enterprises with backward production capacity must be eliminated, and the demand for cotton will be reduced.

At the same time, textile enterprises should make efforts to create their own brands, so that the brand can become a carrier of value and corporate culture.

In this round of cotton boom, the textile enterprises with their own brands are less impacted because of their high grade and high added value.

(nine) regulate the cotton futures market and let those idle capital have no opportunity to hype.

First of all, we should strengthen the supervision of the cotton futures market, and let the cotton futures market be standardized and improved as soon as possible, so as to make full use of its function of excavating prices and avoid the function of its speculation.

The Central People's Bank of China should take effective and appropriate policy to tighten monetary policy, curb inflation and return idle funds in society to the "reservoir" as soon as possible, so as to avoid flooding everywhere and thus affecting the real economy.