India Banned Cotton Exports And Global Cotton Prices Rose

Yesterday, the world's second largest exporter of cotton, India, issued an export ban, which was boosted by the news. Experts said that the ban on export of cotton in India will create a tight market supply in the short term, while domestic textile enterprises will have strong demand for imported cotton and cotton prices will rise in the future.

　　 India export ban directly benefits us cotton

Yesterday afternoon break time, the market came to the news that India issued a ban on cotton exports. The India government announced in March 5th that it would prohibit the export of cotton products with tax numbers 5201 and 5203, including export orders registered with its government. According to the India cotton trader, the cotton that was ready for shipment at the port was unable to declare yesterday.

After the news came out, the price of the electronic disk of the United States cotton rose by 3 cents. Zheng cotton dropped 100 points from the morning to 300 points after opening in the afternoon, and the total price rose 400 yuan / ton. Zheng cotton closed up 1.29% to 22040 yuan / ton. As of press release, US cotton quotes 91.92 cents / pound, up 3.84%.

Lin Shujuan, an analyst with Guotai Junan Futures, said: "yesterday's cotton market was weak in early trading, and cotton prices rose sharply in the afternoon after being affected by emergencies."

Experts believe that the news of India's ban on exports is most beneficial to US cotton. China International Futures analyst Chen Ping told reporters that India is the second largest exporter of cotton in addition to the United States. The annual export of cotton is about 1 million 500 thousand tons. In the international market, India cotton is a strong competitor of the US cotton. The biggest feature of India cotton is its low price. After the India cotton export ban is promulgated, the US cotton will become the biggest beneficiary. It is expected that the US cotton will launch a rally in the late stage.

It is understood that the United States and India are the world's major players. cotton Exporting country. Among them, the US cotton export contract volume has exceeded its estimate, when the new cotton sowing, there is little left in the market cotton. If India's cotton is forbidden to export, it will create a tight market supply in the short term.

　　 Domestic textile enterprises

Demand for imported cotton is strong.

Judging from the domestic market, China is the main importer of cotton in India. Since the year of 2011/12, more than 2 million tons of cotton have been imported into China, nearly half of which come from India. It can be seen that after the stop of export of cotton in India, the supply of domestic cotton market also has certain influence.

It is worth noting that domestic textile enterprises have relatively strong demand for relatively cheap India cotton. Xu Zhou, a futures analyst in East Asia, said that because of the domestic cotton temporary purchase and storage policy this year, domestic cotton prices were supported by the reserve price and maintained at 20 thousand yuan / ton, which was higher than the import price. At present, domestic cotton storage and storage has accumulated about 2700000 tons, accounting for nearly 40% of domestic output. When the peak season of downstream consumption is coming, there is a demand for replenishment in the market, especially for cheap imported cotton. Therefore, in the short term, domestic cotton may have a tight supply situation. {page_break}

Shanghai's mid-term analyst sees the introduction of thunder, saying that China imports nearly 3 million 700 thousand tons of cotton annually, and imports 800 thousand tons from India this year, the rest from the US, Uzbekistan, Australia and so on. This year, cotton prices in India are much lower than domestic cotton prices, so they are very popular with traders and textile enterprises. Under the pressure of India cotton, the prices of cotton and cotton in the early stage remain weak and the market is not good.

　　 India Spin Industry faces challenges

Why is India issuing the cotton export ban at this time? In this regard, Chen Dong, an analyst with Baocheng futures, said that this is mainly the India government's interest in protecting the textile enterprises in the country.

With the appreciation of the India rupee against the US dollar and the rise in the prices of producer goods, India textiles also encounter difficulties in the global market, and the survival environment of textile enterprises is facing challenges.

In order to maintain the industry interest The India Textile Association has proposed to the government that India cotton Price Cheap, transported to the international market in large quantities, including textile competitors like China and Pakistan, which are actually using their resources to expand their competitors, which is unfavorable to the development of India textile enterprises. Therefore, the India textile association suggested that the government ban cotton exports, or at least raise the zero tariff on cotton exports to 4% to 5%. Such a country can not only increase taxes, but also protect India's textile competitiveness to a certain extent.