Spinning Enterprises, Orders Less Than Cotton Prices Remain Weak

Recently, Zheng cotton main contract 1505 basically maintained at 12700 yuan / ton -13200 yuan / ton range shock, upward impact kinetic energy near 13200 yuan / ton pressure.

For later stage

Trend, I believe that, in the current textile consumer market has not yet seen significant improvement, while the supply of new cotton has gradually increased, it is expected that cotton prices will continue to trend in the short term, the medium and long term remain empty.

According to China Cotton Information Network

It shows that as of the end of November, the inventory of cotton stocks in textile enterprises was 501 thousand tons, an increase of 18 thousand and 600 tons from the previous month.

Of those surveyed, 37% reduced cotton inventories and 44% increased cotton inventories.

The stock of disposable cotton in textile enterprises was 676 thousand and 100 tons, an increase of 22 thousand and 400 tons from last month.

The main reason for the increase in storehouse and disposable inventory is: as the year draws near, part of the cotton is coming.

In order to obtain quotas, the purchase of Xinjiang cotton has been increased recently, so as to finish more purchasing work of Xinjiang cotton by the end of December, and obtain more cotton quotas. Xinjiang's new flowers are coming out of the border, and some new parts of the inland bank are added to Xinjiang cotton.

Cotton prices are relatively stable and remain low, and textile enterprises will increase their willingness to purchase raw materials.

Even so, the current industrial inventory of textile enterprises is still low, showing that the downstream textile consumption of cotton is not optimistic.

Look at the current situation of textile enterprises. According to the survey data of operating rate in November, the average operating rate of textile enterprises above designated size is 81%, which is lower than that of 89% in the same period last year.

Compared with the operating rate of textile enterprises in recent two years, the operating rate in 2014 was lower than that in the same period last year, except for two months in the beginning of the year.

The reason is that nearly 50% of enterprises say that the order is insufficient.

The difficulty of spot sale of Xinjiang cotton further reflects the weakness of consumption.

The cotton situation analysis meeting held in Beijing on 16 may, Liang Dongya, vice president of the Xinjiang Cotton Association, said that at present, the processing capacity of the Corps reached 67% of the pre production, and the storage capacity was about 1100000 tons. The sales volume was 250 thousand tons, occupying 13%-14% of total output. This year's sales speed is lower than the historical level, and sales have increased greatly.

More than 60% of the Corps is picked by machine, and the northern Xinjiang hand picked is basically sold out, and the latter will continue to increase sales of machine picked cotton.

The problems faced by the corps cotton sales now are: pportation is difficult and the cost of pporting new flowers is greatly improved.

Sales are difficult and target prices protect the interests of cotton farmers, but business enterprises are in great difficulties.

The difficulty in selling cotton in the Corps has also expressed the voice of all the cotton processing enterprises in the market, and further reflects the weakness of the current textile consumption.

On the 16 day, the Ministry of Finance issued a document. China adjusted import and export tariffs on the 1 date of January 2015, and continued to implement a sliding tax on a certain quantity of cotton imported from the tariff quota.

The information is quite different from the principle of non issuance of quotas in 2015.

The adjustment of import policy actually loosened the import threshold without the import quota textile enterprises, and under the circumstances that the difference between domestic and foreign cotton prices was further narrowed, it was expected that the outer cotton would fall to a certain extent or would arouse the enthusiasm of domestic textile enterprises to import.

According to statistics, as of December 18th, the price difference between home and abroad has been reduced to -67 yuan / ton under sliding tax, and the price difference of 1% tariff quota is 2347 yuan / ton.

To sum up, under the background of the current textile consumption in the lower reaches of the cotton industry, it is still expected that the cotton price will remain under pressure in the late stage.

But under the support of "good cotton is hard to get" and the replenishment before the Spring Festival, there is limited space for short-term downflow.

However, the shortage of orders is still the "culprit". Before the fundamental problem is solved effectively, cotton prices are expected to remain in the middle and long term.