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Domestic Cotton Prices Will Return To Market In 2014

2014/2/27 9:17:00 72

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Direct Subsidy > a href= "http://www.91se91.com/news/index_q.asp" > policy < /a > replace temporary purchase or storage, or become a signal for global cotton stocks to increase and decrease. At the beginning of this year, the CPC Central Committee and the State Council issued several opinions on comprehensively deepening the rural reform and speeding up the modernization of agriculture. It was put forward that in 2014, the pilot project of cotton target price subsidy in Xinjiang will start, and domestic cotton prices will return to the market -- 
 "Xinjiang implements the target price subsidy, the open mechanism receives and stores the policy to come to an end, the cotton industry will reasonably determine the price range." Gao Fang, Secretary General of the China Cotton Association, said that if there was no China's market support policy, it is expected that the international cotton prices will fall below this year. The demand situation and high storage will lead to lower domestic cotton prices in China, and the gap between domestic and foreign cotton prices will gradually shrink. 
At the same time, at the same time, the cotton storage and storage in 2013/2014 will end at 11 million tons, and the national cotton reserves will reach up to a total of P tons. In addition, the current rules on subsidies have not yet been released, and there are still uncertainties about the market. 
 cotton collection and storage predicament /p >
 the purpose of purchasing and storing is to stabilize market price fluctuation and protect the interests of cotton growers, but now it is in a dilemma. 
 cotton temporary purchase and storage policy has its specific historical background. At the beginning of 2010, cotton appeared an unprecedented market and the price was higher. However, in 2011 of March, the cotton market plunged, and China's cotton price index continued to decline, reaching a 39% decline in mid August. 
 to stabilize the cotton market, in September 2011, the state launched a temporary cotton purchase and storage policy to support the city's "fire fighting". It is undeniable that the temporary purchasing and storage policy has played an important role in protecting the interests of cotton farmers, stabilizing the market and ensuring supply. National agricultural products [-4.85% Fund Research Report] cost and income survey data show that in the situation of shrinking cotton demand and falling international cotton prices, cash income per mu of cotton in 2011 and 2012 was 1121 yuan and 1282 yuan respectively, a higher level in the past 10 years. 
 however, due to the poor cotton price at home and abroad, < a target= "_blank" href= "http://www.91se91.com/" > textile < /a > the high cost of enterprises, the reduction of competitiveness and the loss of orders, coupled with the huge inventory of national reserve cotton, it is difficult to digest, and the related financial pressure and market pressure based on the temporary cotton purchasing and storage policy surfaced. 
 up to now, domestic cotton purchase and storage price is 20400 yuan / ton, spot price is high. Meanwhile, the international cotton price has been down to 15000 yuan / ton, and the price difference between domestic and international cotton is no more than 4500 yuan / ton. As the cost of cotton accounts for 70% of the cost of the cotton spinning industry, in order to alleviate the pressure brought by the high cotton price to the enterprises, China has implemented the 3:1 quota of import quotas, that is, cotton spinning enterprises need to buy 3 tons of domestic cotton in order to get 1 tons of imported cotton quotas. 
 for this reason, Wang Sishe, President of Hengfeng Textile Co., Ltd. of Dezhou, Shandong, said that the quality of cotton produced by the enterprises was different from that of imported cotton, and the high quality cotton needed for production could only rely on imports. "For export oriented textile industry, the cost gap of up to 4000 yuan has greatly weakened the international competitiveness of products." 
 "temporary purchasing and storage policy is an emergency short-term policy, but it is forced to normalize, making it difficult for the market to play its role." Gao Fang said that the policy adjustment is coming soon, and the target price in the future is expected to bring positive benefits to the textile market. 
 from "policy market" to "market market" /p >
 the comprehensive adjustment of purchasing and storage policy should include implementing cotton direct subsidy policy, target price subsidy, and gradually liberalized import cotton quota and so on. 
 simply speaking, the implementation of direct subsidy policy can stabilize the cotton farmers' income while reducing the cost of raw materials for cotton spinning enterprises, and at the same time, reduce the pressure of import shocks caused by the long term "upside down" of domestic and foreign cotton market prices. As early as last year, the national development and Reform Commission has identified Xinjiang as the only pilot area for cotton farmers' direct subsidy policy. It plans to transform the temporary cotton purchase and storage policy into a cotton subsidy policy to strengthen the market's role. However, domestic cotton prices did not decline rapidly, and the impact of this negative factor on cotton market was soon overshadowed by continuous high price storage. 
 "from the domestic cotton market in 2013, there are 3 main prices, forming a double track system of purchasing, storing, throwing and storing cotton prices." Zhang Wenmin, general manager of Wanda futures cotton industry division, said: first, the storage and storage price of cotton reserves is 20400 yuan / ton, mainly for cotton growers and cotton enterprises; the two is the reserve cotton throwing and storing price of 18000 yuan / ton, mainly for textile enterprises; three, futures, spot and matching cotton prices, fluctuating between 18000 yuan and 20500 yuan per ton, with the throwing and storing price and the number of storage and storage. 
 "policy market" has stabilized the domestic cotton price, but has broken the original trade ecological environment, and cotton spot trade has almost stagnated. Ji Guang Po, senior commissioner of the Zhengzhou commodity exchange, believes that not only the export of cotton textiles has been declining, but also the textile enterprises are facing the double pressure of cost increase and lack of competitiveness. 
 the policy of collecting and dropping reserves has made the spot price of cotton in China fluctuate for a long time. This effect is also directly reflected in the futures market. Because the reserve price is the bottom of the market, there is little cash circulation in the market, and the physical enterprises do not have the price risk avoidance demand and are difficult to organize the delivery of warehouse receipts, so the demand for futures hedging is weakened. 
 the implementation of the policy of purchasing and storing direct subsidy, or promoting the domestic cotton price has gone through a big policy process. "At present, the domestic cotton market is in the transition stage from" policy city "to" market city ", and no longer continues to throw large quantities of storage and distribution of imported cotton quotas, so it is possible to completely cancel quotas and reserve cotton subsidy policy will be further adjusted and optimized. Zhang Wenmin believes that the comprehensive adjustment of purchasing and storage policy should include implementing cotton direct subsidy policy, target price subsidy, multiple comprehensive subsidies, reserve cotton purchase and storage, throwing and storing wheels to stockpile, gradually liberate the quotas of imported cotton, and improve China's cotton industry market policy and new comprehensive management system and so on 4 aspects. 
 do a good job in risk prevention and control management 
 processing enterprises, trading enterprises and textile enterprises should make corresponding risk management preparations 
 reporter survey found that the future market and how to change the demand is a common concern of the upstream and downstream enterprises. "The implementation of the new deal makes the cost less and the industry chain information transparent." However, Wang Si said frankly that he is also worried that the cotton policy change is bigger, the price can steady docking, if falls too much, the enterprise's stock cotton yarn and so on are in the depreciation, but at present the big enterprise has at least 3 months stock. 
 the change of supply and demand is the main factor affecting cotton price trend, but for cotton textile enterprises, the impact of cotton spot price fluctuation is different. "Prices are skyrocketing, companies are facing the risk of rising raw material costs, and falling prices will lead to a fall in prices of cotton yarn and other products, resulting in difficulties in product sales and risks in operating losses." Ji Guang po said. 
 for upstream purchasing enterprises, business risk is also increased. Wu Ruoyun, an investigator of the Hunan Provincial Department of agriculture, said that the reference factors for storing and storing the storage enterprises include the amount of cotton storage, domestic prices, the rise and fall of international cotton prices, and the downstream market. The policy of temporary collection and storage has national funds, and the implementation of target price pilot increases the autonomy of the acquiring enterprises and increases the risk of self financing. 
 Zhang Wenmin suggested that large enterprises can establish all spot quantities as the basis for business futures, timely and fully hedge futures in full, and complete strategic adjustment within 2 to 3 years to optimize the layout structure of cotton production and marketing. Cotton textile enterprises must make timely hedging of futures sales of 60% to 70%, 80% to 90% of the existing cotton and cotton yarn stock orders and expected business volume. 
 China International Futures analyst Chen Ping believes that for processing enterprises, the sales market of cotton will be reintegrated with the market. It is necessary to strengthen the risk management of its own stocks. For import trading enterprises, the price of import quotas will no longer continue to be high, and the difference between domestic and international cotton prices will be narrowed or the quotas will be devalued considerably. Attention should be paid to the risk management of quotas < a href= "http://www.91se91.com/news/index_c.asp".