Cotton Market: High Inventory Is The Market'S "Bruising"

Recently, Zheng cotton main contract continued downward 1605, the average system also diverged.

Textile consumption in the lower reaches is sluggish, and it is expected that the latter will continue to decline.

Under the constraints of the poor economic environment, the domestic demand market downturn, the fierce competition in the export market, the import of yarn and cloth to occupy the domestic share and the substitution of chemical fiber, China's textile industry is facing a serious situation, and cotton consumption has obviously shrunk.

Downstream demand for cotton is depressed, restricting

Taking goods, and thus drag on its enthusiasm for stocking.

Moreover, the shortage of funds in textile enterprises is relatively common, which restricts the procurement progress, and the supply of cotton market is still loose.

Before the substantial improvement in downstream consumption, cotton prices rose powerless.

First, textile and garment retail has improved, but the effect is not obvious.

According to the statistics of the China National Business Information Center, in October 2015, the retail sales of clothing commodities of hundreds of major retail enterprises in China increased by 1.9% over the same period last year, reversing the 3 consecutive month of decline since June. The growth rate is 4.4 percentage points faster than the same period in 2014, which is 6.7 percentage points higher than that in September.

At the same time, retail sales data show that in October, the volume of retail sales of all kinds of clothing in 100 major large retail enterprises increased by 8.5% over the same period last year, 0.5 percentage points lower than that in September.

According to the published data, domestic clothing sales improved in October, but it was not obvious. The domestic sales of China's textile and clothing remained depressed.

Secondly,

Exports continued to show negative year-on-year growth.

According to the latest data from the General Administration of customs, in November 2015, China's textile and clothing exports amounted to US $21 billion 982 million, a decrease of 7.07% compared to the same period, down 9.71% from the same period last year.

As of November 2015, there were 10 months of negative growth in textile and clothing exports in the year.

Downstream consumer demand is not optimistic.

Third, the enthusiasm of the textile enterprises as a whole is poor.

China cotton information network statistics show that in November 2015, the textile enterprises in the warehouse stock of 419 thousand tons, an increase of 29 thousand and 600 tons compared to October, textile enterprises can control cotton inventory of 421 thousand and 900 tons, compared with October to reduce 15 thousand tons.

In that month, cotton spot market resources were relatively abundant. Most enterprises were worried about the limited number of high-grade cotton, and later procurement was not easy to group, but centralized replenishment.

However, due to the lack of confidence in the market and the tight funds, many enterprises maintain a relatively low disposable inventory and weaken their purchasing intention later.

The US Department of agriculture's December supply and demand report predicts that the total cotton output in 2015/2016 will be 22 million 580 thousand tons, 417 thousand tons lower than the November forecast value, the global consumption of 24 million 252 thousand tons, the reduction of 44 thousand tons, the global import and export volume of 7 million 700 thousand tons, the increase of 220 thousand tons, the end of the global period 22 million 729 thousand tons, the reduction of 369 thousand tons, and the global inventory consumption ratio of 93.72%, down by 7.76 percentage points year-on-year.