Textile Raw Materials Are Poor &Nbsp; Cotton Spinning Policy Is In A Dilemma

Entering the April, the main cotton producing areas in the Yangtze River Basin and the the Yellow River River Basin began to enter the preparatory stage for cotton planting. In this period, stabilizing cotton prices is crucial for improving the enthusiasm of cotton growers and stabilizing the cotton planting area.

Reporters have also recently learned that many policies and measures formulated by the state for the upstream and downstream industries of cotton are facing a dilemma: first, we must prevent cotton prices from falling sharply and protect cotton farmers' cotton yields; first, we must consider the current situation of textile enterprises and promote textile enterprises to start production.

Whether it is the determination of the price of cotton purchase and storage in the next year or the issuance of cotton slip tax quotas, there is no doubt that the policy decision is prudent and difficult.

Purchase and storage price choice dilemma

In order to stabilize cotton prices and improve the enthusiasm of cotton growers, the government announced the next year ahead of schedule in early March.

"Raising 600 yuan per ton is equivalent to raising 1 cents per catty seed cotton, increasing revenue by 50 yuan per mu, which is still much lower than planting grain."

A cotton grower in Shandong told the new financial reporter.

Although the price is not losing money, it can not earn money.

Now the price of grain is higher and higher, and planting cotton is time-consuming and energy consuming. The manpower cost of planting cotton is more and more expensive. Selling at the present price is not as good as planting grain, or simply going out to work. "

Owing to the lack of competitive advantage in planting cotton compared to other crops, the cotton planting area in China showed a marked downward trend in 2012. The survey results of the national cotton market monitoring system in March showed that the cotton planting area in the whole country decreased by 9% compared with last year.

Before the end of the new cotton planting, there may be some adjustment in the actual planting area. However, the obvious reduction of cotton planting area in 2012 has become an indisputable fact.

Earlier, according to the growth of cotton growers' cost at present, it is generally expected that the price of cotton temporary purchase and storage will be raised by 5% in 2012. If the price is estimated at 19800 yuan per ton last year, that is to say, it will increase by 1000 yuan per ton, but it will only increase by 600 yuan in the end.

Some market participants told reporters that the increase in the price of cotton purchasing and storage is far below market expectations, mainly considering the current domestic market.

Guo Du futures cotton industry researcher Liu Chunfang told reporters that since the second half of last year, the demand for cotton in the international market has continued to slump, while the growth rate of domestic demand is slowing down. Many textile enterprises reflect that at present, large orders are seldom received, basically small and medium-sized orders.

In addition, textile enterprises are also faced with outstanding problems, such as the continuous increase in labor, electricity and capital costs, financing difficulties, financing and environmental protection pressure.

Under the difficult situation of the textile industry, if the state raises the price of cotton in the next year, it will increase the production cost of textile enterprises and make the textile business worse.

Issue of quasi tax quota allocation

In addition to the frustration of purchasing and storing prices, the issue of quasi tax quotas issued by the industry generally reflects the hesitation of the state in the policy choice of the cotton textile industry.

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Since the beginning of last year, the international cotton price has continued to decline due to the large increase in output and the slow down of demand. However, the domestic price of cotton has been obviously "underpinning" because of the price of 19800 yuan / ton, and the domestic cotton price is obviously higher than the international market.

The reporter learned that as of the end of March, the domestic cotton market price was above 19500 yuan / ton, which was about 2000 yuan / ton higher than the price of cotton outside the port, which was 3000 yuan higher than the foreign market average price -4000 yuan / ton, while the cost of cotton in India, Pakistan and other countries was 7000 yuan less than that in China, -8000 yuan / ton.

Reporters were informed that the same as of the end of March, the state has not yet issued the 2012 cotton quasi tax quotas, due to quota restrictions, so that a large number of small and medium-sized textile enterprises can not purchase cheap international cotton.

The huge cost of cotton making has greatly affected the international competitiveness of China's cotton textiles. India, Pakistan, Vietnam and other countries have taken advantage of the advantages of China's cotton yarn and seized a lot of market share.

"The price of India cotton yarn is cheaper than our domestic cotton price. How can we make the cotton yarn, cloth and clothing match up with others?"

During the interview, Tan Xiaohu, the head of a textile enterprise in Hebei, told reporters.

Because of the lack of cost advantage, China's textile industry

Liu Chunfang told reporters that China needs to import about 3 million tons of cotton from the international market to meet the cotton demand of domestic cotton textile enterprises every year. So far, the country has only issued 1% tariff quotas of 894 thousand tons. Because of the low level of the quota tariff, only those enterprises with a certain scale advantage can get it, so for most small and medium-sized cotton textile enterprises, they can only wait for higher tax rate quota.

So far, the main reason for the delay in issuing the quota is to control the quantity of imported cotton and stabilize domestic cotton prices.

Due to the large profit margins of imported cotton at present, if the import quota of sliding tax is granted, the influx of large quantities of cotton will surely increase the quantity of domestic cotton supply, and thus suppress the domestic cotton price. At present, it is in the critical period of cotton sowing. Stabilizing cotton price in this period is particularly important for improving the enthusiasm of cotton growers.

Therefore, at least until April when the new cotton planting is finished, the possibility of issuing quasi tax quotas is less likely.

Slippage tax quota is not released, resulting in a large number of foreign cotton to enter the domestic market, and some cotton importers even take the initiative to ask foreign businessmen to postpone the shipping schedule for 1-2 months or to ship according to the contract date, making the current 3-4 months sailing very few cotton, there is simply no monthly shipping quotes outside cotton, only the port bonded cotton spot offer.

At the same time, due to the shortage of quotas, the 1% tariff quota pfer price has risen.

According to the survey, as at the end of March, the pfer price of the 1% tariff quota of Qingdao port and Shanghai port has reached 2700-2800 yuan / ton. Nevertheless, because the quota is very tight, and the price difference between inside and outside is still more than 2000 yuan / ton, the quota is high but not worried about the pfer, while the large and medium-sized cotton enterprises do not intend to use tariff quota in 3 or April. Instead, they want to use "good steel on the knife edge". Once the domestic high-grade cotton is in short supply, they will try to reduce the purchase of cotton from the national reserve sale and vigorously import foreign cotton to make up for the shortfall.

On the one hand, the high cost of planting cotton, the low selling price of cotton, the low enthusiasm for cotton planting by cotton growers, on the other hand, the sluggish demand, the declining demand for textile and clothing, and the high domestic cotton price relative to the international market, which has led to the decline of the competitive advantage of domestic textile enterprises.

Cotton textile policy has become the focus of attention in the market.