Hold Down Or Reverse &Nbsp; Where Will Cotton Price Be Sung This Year?

In 2010~2011 cotton textile market in China, there was a rare "roller coaster" market with a rare rise and fall. During the period, the fluctuation and the duration were all rare. Cotton textile enterprises failed to share the profits in the bull market and bear market transformation, but instead, they misjudged the situation. loss The large majority have changed from general profits in 2010 to obvious losses in 2011.

Due to strict control of inflation and tightening monetary policy in 2011, capital fled in 2011, and the export market shrinked. demand Under difficult circumstances, the market of cotton textile has been turning sharply, and the situation of supply exceeding demand has been obvious throughout the whole year, and the price declines have deepened. Then, what opportunities will we face in 2012 if we are going to reverse or continue to fall? Challenge How big is it?

2011:

Market "diving" causes business losses to intensify

Compared with the market price range of raw materials, yarns and grey fabrics in 2011, we can see that the price of raw materials, yarns and grey fabrics in domestic cotton textile market has dropped sharply since March 2011. As the decline in the upstream and downstream markets is not synchronized, the prices of some cotton yarns and grey fabrics are falling faster than raw materials, resulting in an increase in corporate losses.

Judging from the varieties, after the end of February 2011, the main varieties of cotton, polyester cotton, cotton products and other major products declined significantly. In the first half of the year, all cotton products took the lead. In the second half of the year, polyester cotton and cotton products were led to fall, and the three groups experienced a downward trend of collective decline throughout the year. This reflects the excessive speculation in the market in 2010, and the price is out of supply and demand, resulting in a huge "squeeze" in 2011, which brings great pains to the industry. On the other hand, it shows that the market demand is not good, the price is down, the market is rational, and the loss of cotton textile enterprises is increasing. Two or two days of "ice and fire" appeared in the past two years.

In 2010, the demand for cotton products was strong, and the volume rose to a new high. There was a rare bull market in decades. After the Spring Festival of 2011, with the help of funds, the domestic cotton price has reached a new high, while the prices of downstream products such as cotton yarn and grey cloth have not surpassed the high point of November 2010. After the end of February and the beginning of March, market sales were blocked, prices stagnated and plummeted, and some cotton yarn and grey fabrics had fallen over the upstream raw materials. The fall in 2011 basically swallowed up the 2010 increase.

According to the feedback from some large and medium enterprises in Jiangsu, Shaanxi and Shandong, 2010 was at the best level in history. However, in 2011, it was generally trapped in production and marketing difficulties. After the beginning of March February, the cotton product market dropped sharply, and the trend of decline was rapid. In September 8th, due to the 19800 yuan per ton cotton purchase per ton, and the expectation of the traditional textile sales season, the initial cotton textile market in August bottom rebounded slightly, but it was still unable to restore the declining trend. 1~12 cotton prices fell 12500 yuan / ton in recent months, or nearly 40%, while C32S cotton yarn prices dropped by 13700 yuan / ton, or 35%, and the price of all cotton grey fabrics decreased by 3.00~5.00 yuan per year, or around 30%~45%. Overall, the domestic cotton price "diving" drives cotton and grey fabrics and other products to depreciate, while the cotton yarn and grey fabric market is getting cold and dragging down the acceleration of cotton prices. The three factors influence each other and restrict each other.

Due to the market demand being hindered, and the impact of the sharp decline in the cotton fabric market, the market of polyester cotton and cotton products went down all the way in 2011. Among them, the market of polyester cotton products in the first half of the year dropped slightly less than that of all cotton products. Later, due to the strong market risk aversion, a large number of cotton products enterprises transferred cotton blended and chemical fiber products, resulting in a rapid increase in the output of polyester cotton and cotton products. Among them, in 2011 1~12 month, domestic viscose staple fiber prices fell 12600 yuan / ton, or 44%, R30S cotton yarn prices fell 13600 yuan / ton, or 41%, and the price of cotton grey fabric fell by 2.20~4.00 yuan / meter, or about 40%.

Overall, in 2011, the upstream and downstream products of viscose decreased more than cotton, polyester and cotton products, and the polyester products decreased the smallest. Therefore, the market demand of polyester products increased, and the trend of "cotton to polyester" in cotton textile enterprises was obvious.

2012:

Annual situation or "three steps"

From the fourth quarter of 2009, the domestic cotton textile enterprises have changed their profits. In 2010, there was a rare bull market. Cotton textile products were in short supply and prices rose sharply. However, in 2011, the bull market could not be extended, but instead, it would turn to the top of the market. How would the cotton textile market in 2012 continue to fall or reverse?

From a technical point of view and trend analysis, since the decline of the cotton textile market in 2011 has been deep and some products have fallen too much, we should not continue to see the decline in 2012. However, we still have no reason for optimism from the fundamentals of supply and demand and the complex external situation, especially in the first half of the year. It is expected that the second half of 2012 will be better than the first half of the year. The overall situation will be slightly better than that in 2011, but it will still be significantly worse than 2010, or it will show the trend of "three steps".

The market situation in the first quarter was "first suppressed and then Yang". Due to the substantial release of the market risk, the cotton purchase and storage in September 8, 2011 has become the "fixed sea god needle" in the domestic market. No matter how much the international cotton price has fallen, the domestic cotton price has always been stable in the line of purchasing and storing prices. Before the end of the end of March 2012, it is certain that domestic cotton spot and Zheng cotton futures are less likely to fall below 19000 yuan / ton during that period. The cotton textile market in the first quarter showed a trend of "stable and medium growth", but it would not be too large if the supply and demand relations were hard to reverse and the macroeconomic situation was declining and the tight monetary policy was difficult to turn. Therefore, in the case of relatively good corporate capital, it can be sold at low prices a few years ago.

After the end of the purchase and storage in April, the cotton textile market will face the direction again. At the end of March 31, 2012, the acquisition of national cotton reserves will reach about 3000000 tons, accounting for more than 40% of the total output of 7 million 200 thousand tons. After the end of the storage and storage, the market circulation resources will be reduced. Cotton textile enterprises may face obvious cotton shortfall. However, the abundance of state reserves has strengthened the ability of the state to regulate cotton prices. When the shortage of cotton and cotton prices are rising rapidly, the state can put large quantities of storage or import pressure cotton prices, making it difficult for the cotton textile market to continue to rise in 2012. Therefore, there will be a large number of imported cotton quotas and a small number of down sale in the following market: if the imported cotton quotas are not issued in a small quantity or not in time, the prices of current international cotton, cotton yarns and grey fabrics are much lower than those of the Chinese market. The prices of cotton in Pakistan and India countries are lower than that in China by 7000 yuan / ton, and the price of grey cloth is less than 1 yuan / meter above the same standard products in China. The cost of cotton production in China's cotton textile enterprises is much higher than that of the main overseas competitors, and the situation of foreign direct loss will further aggravate. As China's textile and apparel have a high dependence on foreign trade, the closer it is to the dependence of the terminal market, the lower the export of textile and clothing will be hindered, and the prosperity of China's domestic market will be reversed. The situation of the textile industry is hard to improve significantly. The more difficult business situation is difficult to sustain the high cotton price, and the latter is bound to maintain a weak trend.

If a large number of imported cotton quotas are issued in a timely manner, the cotton market is facing an accelerated fall in the downstream situation after the recovery of the downstream situation and the impact of cheap imported cotton. At that time, the domestic cotton market is expected to fall to the price level before the 2010 surge. It is also embarrassing to store and store cotton. It is obvious that this situation is not the original intention of the management department, so the possibility of large quantity of full quota of imported cotton quota is relatively small.

In the current trend analysis, in order to ensure that domestic cotton is not impacted by cheap imported cotton, the number of imported cotton quotas may be reduced in 2012. Under the support of purchasing and storage policy, China's cotton prices remained high in the second half of 2011 to the beginning of 2012, and imported cotton was favored by cotton textile enterprises for its superior quality and low price.

However, no matter how, after April, the cotton textile market will once again face greater pressure of production and marketing. If a large number of excess quotas are issued, it is expected to accelerate domestic cotton prices down. If a small amount of imported cotton quotas is issued, the downstream enterprises such as cotton yarns and grey fabrics will lose their living environment because of the high cost of cotton production and the loss of labor power and comparative advantage. The cotton textile enterprises will not be too good at that time, and the substitution effect of the substitute products will become apparent.

The second half is expected to be better than the first half of the market. After the sharp fall in 2010/2011 and the baptism in the first half of 2012, the market situation after 2012 August is expected to be slightly better than the first half of the year. The main reason is that after the inventory digestion in the first half of 2011 and the first half of 2012, after the second half of 2012, the "de Stocking" of cotton and grey fabrics will achieve obvious results, laying the foundation for the cotton textile market to rebound. Due to the sharp fall in 2010/2011, the enthusiasm of domestic cotton seed fell in 2012. Many cotton farmers abandoned cotton and converted to other crops. After September, the output of new cotton is bound to decline again, and the relationship between supply and demand is expected to improve. After the sawing competition, the impact of the sovereign debt crisis will ease in the second half of 2012, and the global market will face a new round of replenishment opportunities. Under the domestic real estate market and price effective control, the domestic tightening monetary policy is expected to gradually relax. In addition to the first half of the year, the interest rate level is expected to decline after the second half of the year, and the relaxed credit environment will also boost market demand.

Looking forward to 2012, the European debt crisis is difficult to alleviate, and the US economic growth is stagnant, resulting in the downside risks of the global economy increasing. The demand for overseas markets is difficult to shake, and textile exports are facing difficulties. The situation of cotton textile market in 2012 is hardly optimistic if the situation is still not reversed and the industry is hard to recover.

Although there are many uncertainties in 2012, the capacity of the state to regulate domestic cotton prices has been greatly strengthened. If the quota of imported cotton is not large enough to continue to fall, it is difficult to continue to rise due to the policy of relocating and storing. Therefore, it is possible to predict that the cotton textile market in 2012 will not appear in the extreme market of unilateral inflation in 2010 or unilateral slump in 2011. It is expected that in 2012, the overall situation is slightly better than that in 2011, but it will still be worse than in 2010. The second half is slightly better than the first half.