Cotton Yarn Futures Are Expected To Be Listed In The Year, Textile Enterprises Default Risk Reduction

Here world Clothing and shoes Xiaobian network to introduce to you is cotton yarn futures are expected to be listed in the year, textile enterprises default risk reduction.

Since the launch of the Xinjiang cotton reform pilot program this year and the abolition of the cotton purchase and storage policy for 3 years, the cotton futures of Zhengzhou merchants have finally regain their vitality after 3 years of quiet trading volume. Taking September this year as an example, cotton futures not only increased by 148% in volume, but also increased by 4287% over the same period last year, becoming a star market in the futures market. Moreover, the price trend of cotton futures has also become the focus of discussion in the market.

In recent days, Zhang Fan, director general of Zheng Shang, said at the "2014 Zhengzhou agricultural products cotton futures forum" that in order to better coordinate the cotton target price reform pilot, Zhengshang will complete the work of establishing a cotton spanfer intermediate warehouse in Xinjiang as soon as possible, and improve the cotton industry chain variety system, fully meet the needs of cotton related enterprises, push forward the research and development of cotton yarn futures, and strive for the listing spanaction within the year, and strive to launch agricultural product options as soon as possible.

Cotton industry chain adds a bit

In recent years, with the change of economic environment at home and abroad, the development of China's cotton industry is facing new situations and challenges. The problem of accumulating cotton temporary purchase and storage policy is becoming increasingly prominent. It is more and more difficult to rely on policies to stabilize production and market. As agricultural production has entered the stage of high input and high cost, the linkage between the international and domestic markets has been strengthened, and domestic and foreign cotton prices have been obviously upside down, which makes it more and more difficult to maintain the safety of China's cotton industry.

As pointed out by Wang Xiaobing, deputy director of the market and Economic Information Department of the Ministry of agriculture, China is a big country of cotton production and consumption. The cotton industry is related to cotton farmers' income and is related to the smooth operation of the textile industry. The cotton industry is also facing the risk of fluctuating prices and receiving goods. However, since this year, with the implementation of the pilot project of cotton target price reform in Xinjiang and the introduction of cotton yarn futures in the future, the default risk of textile enterprises will be reduced.

According to the reporter, in 2013/2014, the cotton consumption of domestic textile enterprises has dropped significantly, and the inventory level is very low. But the demand for cotton yarn in foreign markets is higher, so it shows a significant increase in imports. This is a very important threat to traditional textile enterprises. Compared with the price of yarn at home and abroad, the price of yarn in the international market is low, and domestic enterprises will prefer imported cotton yarn, because no quota restrictions, so the amount of imports will be purchased according to the volume of the enterprise needs.

In addition, beginning in early 2014, the domestic yarn market is not optimistic. For example, at the beginning of 2014, the export price of 20 yarns was 21570 yuan / ton, and in October, the yarn price was 19971 yuan / ton, or 7.4%. According to the situation of the whole industry, if there was yarn futures at that time, it could be sold to hedge and avoid the risk of falling prices.

Fu Xiaoyan, an analyst with Nanhua futures, believes that the introduction of cotton yarn futures will help domestic textile enterprises to hedge the risk of yarn price fluctuations and help stabilize the market. For textile enterprises, there is a dual task of purchasing cotton and producing yarn. The risk of purchasing cotton can be maintained through cotton futures. The fluctuation risk of yarn prices can be maintained through cotton futures. Similarly, many domestic traders can also operate on cotton yarn futures.

It is understood that there is no relevant information about the futures contract of cotton futures of Zheng Shang. But at the beginning of this year, there were some parts about the contract of yarn futures in Da Shang, for reference. The futures contract of DCE mainly set 32 and 40 cotton yarns as the trading target, and expanded the delivery area by upgrading the premium. According to the actual market situation and development trend, the quality standard of futures delivery was established based on the national standard. Goods in stock The production characteristics of enterprises are set as 12 consecutive months in contract months, so as to facilitate the operation of spot businesses.

"For example, in the case of China's cotton yarn futures not yet launched, cotton yarn industry enterprises use more cotton futures to hedge hedging of raw materials or hedge their inventory risk of raw materials, but there is an objective risk from cotton purchase to cotton yarn production and sales, and there is an objective risk in the inventory and sales plan arrangement of cotton yarn finished products, which can not effectively take risk avoidance measures." Dong Shuangwei, general manager of Beijing Di AI Si Wu Cci Capital Ltd, interviewed by the China Times reporter, said that once the cotton yarn futures were launched, enterprises could carry out certain risk hedging activities directly through the forward contracts of cotton yarn futures. Of course, this is just a point for enterprises to make use of futures.

Because cotton yarn is in the middle link of the cotton industry chain, upstream has cotton and other raw materials, and downstream garments, textiles and other finished products. The introduction of cotton yarn futures is good for spinning production and consumption enterprises, and is conducive to risk management by means of futures tools. Cotton and cotton yarns are the upper and lower reaches of the industrial chain respectively, and the price trend is correlated.

"For example, a textile production enterprise can lock the raw material risk through cotton futures, but the cotton yarn market is entirely market competition, and the price changes are large. Under the condition of a sharp decline in cotton yarn prices, customers may default on goods, or the production enterprises can only realize their capital turnover by selling at reduced prices." Wang Yan, an analyst with CITIC futures, told reporters that in such a case, if there were cotton futures, enterprises could well hedge the risk of falling cotton prices caused by falling cotton prices.

Textile enterprises look forward to cotton yarn futures

"2014 Zhengzhou agricultural products (cotton) futures forum" released a set of data shows that from 1 to September this year, the number of accounts involving cotton business increased by more than 40% over the same period last year, the risk of demand for enterprises increased significantly. The number of corporate clients involved in cotton futures trading increased by 78% over the same period last year, much higher than the 27% increase in the number of natural clients involved in the spanaction. The legal person accounts for nearly 100 thousand hands per day, an increase of 84% over the same period.

With the cotton futures prices converging, the price difference between China and the United States has narrowed down from a maximum of more than 6000 yuan per ton to about 2000 yuan. Cotton futures price discovery function has gradually been recovered.

With the implementation of the target price subsidy policy, the cotton market is priced back to the market, but the risk of market fluctuation is also increasing. However, it is difficult to completely avoid the risk of enterprises just by hedging cotton futures.

In fact, for our textile enterprises, it is far from enough to rely solely on cotton futures for hedging, because they can not completely avoid the risk of production and operation of enterprises, especially the price of cotton yarn produced by textile enterprises is fluctuating greatly. At the same time, in the process of falling prices, there is a great possibility that the downstream enterprises of cotton yarn will not accept goods and break the contract. Therefore, we look forward to the listing of cotton yarn futures and provide them with risk hedging tools. A textile enterprise leader in Shandong said in an interview with reporters.

Fu Xiaoyan believes that the future cotton yarn futures will be another tool for maintaining the value of the cotton industrial chain. Especially those involving two varieties of cotton and yarn have benefited greatly. Cotton ginning plants and textile enterprises can use cotton to preserve value, and textile enterprises and trade enterprises can use cotton to preserve value or to keep yarn value.

If there is a shortage of supply side, it is possible to buy Cotton hedging. If the demand side is loose, it can sell yarn value. Many enterprises are willing to participate in yarn futures trading. In addition, it can also break the limitation that cotton futures can only carry out cross month arbitrage, and combine cotton, cotton yarn and even PTA to carry out cross variety arbitrage.

After all, cotton accounts for 70% of the cost of cotton yarn production, and the company is very interested in cotton yarn futures. However, the participation of enterprises in the future of cotton yarn depends on the operation of the market. We are generally cautious when we first start listing. We should first observe a period of time to see the operation of cotton futures and spot market, cotton futures, and PTA futures.

Dong Shuangwei said that cotton yarn and cotton as the relationship between finished products and raw materials, the two have corresponding cost and profit relationship, more or less than the finished product relationship, can intervene in arbitrage, the future will inevitably derive two related arbitrage strategy. However, the standards of cotton yarns are relatively complicated, and different manufacturers are also 40S yarns. The standards will be different. In the future, the contradiction between cognition and practical application needs to be eliminated. But for cash enterprise In view of the fact that the cotton futures market has been cultivated for 10 years and the enterprises have a relatively high degree of awareness, they will actively participate in cotton yarn futures in the future.