How Will The Domestic Cotton Industry Face The New Normal?

In recent years, with the increase of domestic production cost and manpower cost, the slowing down of world economic development, the decline of consumer demand and the lag of policy adjustment, China's cotton industry is facing a series of new normal changes in production, consumption, trade and policy support.

1., based on the layout of the entire land and resources, the layout of the dominant cotton region becomes more urgent.

Influenced by comparative advantage, China

The dominant area gradually shifted from the Yellow River and Yangtze River valley cotton area to Xinjiang inland cotton area.

From different crops, cotton is 2 times the total cost of the three largest grain, 3.1 times the labor cost, and the net profit is only 0.64 times.

From different regions, the total cost of Xinjiang cotton area in 2013 accounted for 57.4% of the total labor cost of 89% cotton plants in the the Yellow River basin and the cotton area in the Yangtze River Basin, while the profit in Xinjiang cotton area reached 610.5 yuan per mu, while the loss of 668.11 yuan and 578.70 yuan per Mu in the the Yellow River River Basin cotton area and the Yangtze River Basin cotton area respectively.

From the sowing area, the proportion of Xinjiang's inland cotton growing in the whole country increased gradually. In 2013, the planting area accounted for 40.5% of the cotton planting area in the whole country, an increase of 19.3 percentage points compared with that in 2004, while the cotton area in the Yellow River and the Yangtze River Basin decreased by 18.3 percentage points.

In 2014, with the implementation of the cotton target price subsidy pilot scheme in Xinjiang, the cotton farmers' intention to plant cotton in the mainland further declined.

From the long-term trend, the Yellow River and the Yangtze River Valley have not been able to benefit from planting cotton. Based on the overall situation of land and resources, ensuring the safety of grain, the layout of the dominant area of cotton will become more urgent.

2., based on the "consumption oriented" production, accelerating the upgrading of the consumption structure of the whole industry becomes the general trend.

Under the new normal of economic pformation and upgrading,

The pressure is increasing gradually.

Under the weak demand of global economy, whether textile enterprises can make breakthroughs in scientific and technological progress, industrial upgrading, structural adjustment, brand building, market development and efficiency enhancement will be the key to realize their own sustainable development.

In 2014, for most spinning enterprises, facing high inventory and low consumption is an indisputable fact.

Because of the rising cost of raw materials and manpower, there is no advantage compared with the cotton spinning industry in Southeast Asia, so the future product structure must be pferred to high-end products, and the demand for textile materials is further improved.

However, under the constraint of planting and processing conditions, domestic cotton is often poor in consistency and "three silk" is more, which does not conform to the standards of cotton enterprises.

It will be a general trend to guide cotton production, accelerate the promotion of machine picked cotton, improve breeding and planting standards, and speed up the pformation and upgrading of the whole industrial chain based on "consumption orientation".

3., playing a decisive role in the market and improving the price formation mechanism become the necessary internal strength.

The temporary purchasing and storage policy is intended to stabilize the market expectations of cotton producers, operators and cotton producers, protect the interests of cotton farmers and ensure the stability of the market supply, but there are also some drawbacks in the implementation, including the excessive cost of government financial management.

The temporary purchase and storage policy has been used to mobilize farmers' enthusiasm for planting.

Stability has played a positive role in ensuring the steady growth of farmers' incomes. However, with the changes in the environment at home and abroad, the policy has made the signal of "bottom up" signal significant, and the price "rising or falling" is not only increasing, but also caused the distortion of market price signals, causing domestic and foreign markets to be out of line, price upside down, and import pressure increased, thus forming an unfavorable situation of "increasing domestic production - increasing national storage and increasing imports - increasing the country's reserves", which not only caused the backlog of domestic stock, but also aggravated the financial burden and the cost of management.

In 2014, the first document put forward a pilot project to carry out target price reform and explore reforms to promote the decoupling of the price formation mechanism of agricultural products from government subsidies.

How to give full play to the decisive role of the market, rationally adjust the planting structure, improve the competitiveness of agricultural production and the ability to resist risks, make full use of market operation, achieve quality and efficiency, and ultimately achieve the minimum production cost and maximize the basic benefits.

Whether it is farmers or enterprises, they are the inner strength to practice.

4. to make good use of the two resources of the two markets, and to enhance international competition and cooperation must be perfected.

With the global development of cotton trade and textile trade, the price of cotton market is becoming more and more internationalized, and the price changes at home and abroad are more and more consistent.

In recent years, due to the impact of domestic cotton temporary storage and purchase policy, the price of cotton purchase and storage has risen or not, causing the price difference between domestic and foreign cotton to further widen. Taking 2013 as an example, the gap between 3128B grade cotton and imported M grade cotton after tax in 2013 was increased from 4200 yuan / ton in January to 4600 yuan / ton in November, and the CIF price of imported cotton at 40% tariff rate is still lower than domestic market price.

In the third Plenary Session of the 18th CPC Central Committee, the party put forward the policy of "adhering to the rules of the world trade system and insisting on bilateral, multilateral and regional sub regional cooperation and opening up". With the advance of WTO and the free trade area, China's agriculture must be placed in a more open international environment.

For the cotton industry, facing two resources in two markets has become an indisputable fact. But how to release market signals in advance, effectively guide the market, actively respond to international changes, and grasp the initiative, voice and pricing power in international trade is still an external task for the whole cotton industry in China.