Textile Industry Orders Did Not Turn Well &Nbsp; Cotton Prices Rose Hard To Digest.

Domestic cotton

The international cotton market is also changing due to weather factors, Pakistan floods and the United States.

Cotton production increased and acquisition funds tightened.

According to the US Department of agriculture's September report, the global cotton output in 2011 is slightly larger than the demand for nearly 1 million 700 thousand tons. Even considering Pakistan's 400 thousand tons reduction in floods, the world's cotton still has nearly 1 million 300 thousand tons of surplus, and the supply is relatively loose.

Domestic cotton production is expected to increase by 1 million tons over the previous year. According to the calculation of 20000 yuan per ton, the need for acquisition increased by 200 million over the previous year.

As part of the cotton business suffered losses in the cotton prices in the previous year and failed to return loans to the Agricultural Development Bank in a timely manner, the Agricultural Development Bank has quietly raised the loan threshold this year and requested loans to provide collateral at the same time.

In some areas with low reliance on loans from the Agricultural Development Bank, the difficulty of loans from commercial banks and credit cooperatives is also increasing. The cost of private financing has been rising, and the liquidity of textile enterprises and cotton enterprises is relatively limited.

The six months' continuous inventory process has significantly reduced the funds deposited in the cotton textile industry chain in the past two years.

Increase in production and tight funding constraints on cotton prices

Textile industry orders have not changed well, cotton prices rise difficult to digest.

The global sourcing strategy and online sales mode of garment retailers will lead to the pfer of textile and garment orders to Southeast Asian countries, the pfer of clothing production to the consumption areas, and the order of textile garments to be small, short and fast, which will lead to great flexibility in cotton consumption.

The substantial increase of labor cost in garment enterprises has also led to more cost for garment enterprises.

At present, yarn sales are smooth and seasonal, and cotton prices temporarily stabilize profit margins for textile production temporarily. However, once the new year's cotton price level is determined, export orders will be redefined according to the new annual cotton price, and profit margins will be locked in a very small inter regional range.

The cotton spinning industry chain is longer and the cost increase needs to digest each link of the industrial chain by layer by layer. It is like a very fine sewer pipe. Once thrown into a little larger material, it will probably be blocked.

Consumption does not support a sharp rise in cotton prices.

The current price difference will increase the pressure on the futures market.

According to the 2011 interim

At present, the new cotton market is in the initial stage. The higher purchase price and limited funds will lead to a stalemate in the acquisition. Once the new cotton market is increasing, cotton farmers will finally accept the reality and sell seed cotton according to the purchase price supported by the market funds.

It is estimated that when the contract is started, the cotton price will come down.