Analysis Of China'S Cotton Market Situation And Development Of Cotton Industry Under The New Pattern

Gao Fang, executive director of the China Cotton Association, director of the cotton and hemp Bureau of the China Federation of supply and marketing cooperatives

1. Analysis of China's cotton market situation this year

We all know more about supply and demand in the cotton market this year - high inventory, low production, reduced demand, low cotton prices, narrowing of internal and external spreads, and reduced cotton imports, but cotton yarn

Increase.

Supply and demand balance sheet -- from the supply and demand balance sheet of Cotton Association, the cotton output predicted by 2015/16 is 4 million 820 thousand tons, and the last year is 6 million 500 thousand tons.

Cotton imports are 1 million 190 thousand tons and consumption is 6 million 810 thousand tons. This consumption is generally considered to be more optimistic. As far as we know, the lowest level of consumption in the industry is 5 million tons, the highest level to 7 million tons.

The cotton market in 2015 - the stock of reserve cotton is over history. In the 2011-2013 years and three years, the total amount of storage and storage is 16 million 430 thousand tons, which has been put in 6 million 910 thousand tons. In the 2015 year, the stock of the reserve cotton store exceeds 11 million tons. According to the data of the US Department of agriculture, China's stock accounts for more than 50% of the world's total.

Cotton production in 2015 - according to the National Bureau of statistics, the cotton planting area in China in 2015 is 56 million 980 thousand mu, the lowest in nearly 13 years, and a relatively low level since the founding of the people's Republic of China.

The output of cotton is 5 million 610 thousand tons, of which Xinjiang is 3 million 500 thousand tons.

Cotton imports in 2015 - cotton imports fell sharply in 2015. As of March this year, China's imports of cotton were 575 thousand tons, down 43% from the same period last year.

The average import price of cotton imports was 1720 US dollars / ton, down 6.1% compared to the same period last year.

2015 cotton demand textile and clothing exports also showed a structural decline.

According to customs statistics, as of April 2016, China's textile and apparel exports totaled 176 billion 800 million US dollars in 2015, down 4.3% from the same period last year, of which our April figures were relatively good, up 4.9% over the same period last year.

The import of cotton yarn has also reached a new high. From the 2011-2015 years' import situation of cotton yarn in the past three years, we have seen that the import of cotton yarn has increased rapidly in the past three years. After 2013-2014 years, there has been a slow decline, but it began to pick up again in 2015. According to customs statistics, the total number of cotton yarn imported in China increased by 16.6% over the same period last year.

Cotton prices in 2015 were the main melodies of cotton prices. The abnormal fluctuation of Zhengzhou futures market in April brought rise to the spot market, but lacked the support of fundamentals.

China's cotton price index is 12478 yuan / ton, down 6.8% compared with the same period last year. This is the return of spot prices to the market after the implementation of the target price subsidy policy, resulting in great changes.

The price of seed cotton purchase fell sharply in 2015. As of the end of March, the average purchase price of 3128 seed cotton in 2015 was 5.52 yuan / kg, down 5.8% from the same period last year, of which the seed cotton purchase price in Xinjiang was lower than the national average level.

2015 cotton business inventories, according to the statistics of the China Cotton Association logistics branch, the total cotton business inventory in April was about 1 million 187 thousand tons, a decrease of 473 thousand tons from the previous month, a decrease of 28.5%.

2015 cotton situation - cotton quality has slipped and affected by climate. In 2015, the phenomenon of cotton quality decline has been highlighted, which is characterized by short length and high micron value.

As of April 27, 2016, the cotton length 28mm of the whole country decreased by 12.8 percentage points compared with last year, and 27mm increased by 9.5 percentage points compared with the same period last year.

The percentage of horse A+B decreased by 20.9 percentage points, and C2 increased by 22.4 percentage points over the same period.

Adjustment of processing layout -- with the decline of output, the layout of cotton processing in China has also changed greatly.

Cotton and cotton production is concentrated in advantageous regions such as Xinjiang. This brings about regional changes in processing layout, and the number of processing enterprises in the mainland is relatively reduced.

As of May 10th, China Fiber Inspection Bureau data showed that the number of processing enterprises in fair inspection in 2015 was 1100, representing a decrease of more than 441 over the same period, including 752 enterprises in Xinjiang, accounting for 68% of the total, 53 lower than the same period last year, 348 in the mainland, 32% in the whole country, and 388 lower than the same period last year.

Xinjiang cotton notarization accounted for 91% of the national total, and Shandong, Hebei and other mainland cotton area's public inspection is very few.

2015

In 2015, the target price reform experiment was continued. The target price level was 18600 yuan / ton, which dropped by 500 yuan / ton on the basis of the previous year.

It is generally accepted that the target price subsidy policy for cotton is a cycle of three years. What is the content of the target price policy in the future and what to do next is still under study.

The intention of planting cotton in 2016 -- the China Cotton Association launched a survey of planting intentions in 2016, because the investigation of cotton planting is ongoing.

On the whole, the weather conditions are good in the whole country.

The weather in Xinjiang and the Yellow River is quite good, but the sowing in the the Yellow River and the Xinjiang River Basin is coming to an end. However, too much rain in the Yangtze Valley has a great impact on sowing.

According to the Cotton Association survey data, the cotton planting area of cotton farmers in China has decreased by 11.5%, the the Yellow River River Basin has dropped by 19.1%, the Yangtze River Basin has dropped by 15.1%, and Xinjiang has decreased by 8.6%.

The reserve cotton is out of the way. What we are most concerned about is the launch of the reserve cotton mill in May 3rd.

The national development and Reform Commission and the Ministry of Finance jointly issued a notice on the arrangements for the rotation of national cotton reserves, which was jointly discussed by relevant departments including the cotton association.

There is a very obvious feature. Although continuation of some principles of last year, such as not to suppress the market, is conducive to market stability, but there are also some new ideas, such as "asymmetric rotation, first round and backward entry, multiple rounds and fewer rounds", and normalization of the mechanism.

The characteristics of this state reserve cotton rotation are: 1) normalization and institutionalization of the round out mechanism, regular regular arrangement of cotton reserves, and the reserve cotton will be sold for a long time within the specified time limit; 2) the price of the rotation will be determined according to the market.

Unlike previous fixed base prices, this time

The linkage between the selling price and the domestic and foreign market is determined by the half weight of the spot price index at home and abroad, adjusted once a week; 3) the quality index is more refined.

The round out reserve cotton will be comprehensively examined by the Bureau of quality and weight. 4) make clear arrangements for the storage of cotton.

During the new cotton market, a small quantity of high-quality cotton was introduced into the market according to the output and market supply and demand. In principle, it did not exceed 30% of the previous year's output; 5) a slight adjustment was made in this year's round out arrangement.

In order to achieve a smooth and orderly pition of the old and new mechanisms, on the basis of the above principles, the total output of cotton reserves in the current year will not exceed 2 million tons.

After the start of the current round of reserve cotton production, the selling price at the standard price of 13 weeks in May 9th -5 was 11931 yuan / ton, the average price was 12353 yuan / ton, and the 328 price was 13391 yuan / ton.

The total volume of pactions was about 180 thousand tons, with a turnover rate of 99%, of which 129 thousand tons of imported cotton were traded, and the turnover rate was 100%. The average price of the imported cotton was 13695 yuan / ton, and the turnover of domestic cotton was about 51 thousand tons, with a turnover rate of 97.29%, with an average price of 12626 yuan / ton.

The above is the general situation that the association grasps the whole market, and share with you.

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Two, the development of cotton industry under the new pattern.

Next, I want to talk about the theme of this conference - the development of cotton industry under the new pattern. From the perspective of national macro policy, the government's five major development concepts in the next five years are "innovation, coordination, green, openness and sharing".

Economic situation - the average annual growth rate of GDP from 2016 to 2020 is 6.5%, which is also based on the emphasis on ensuring the growth rate of GDP or ensuring employment.

It is estimated that GDP can solve 1 million 500 thousand people's employment every one percentage point increase, so ensuring employment is also a very big goal of the government.

Now we say that China's economy is facing a painful period of structural adjustment, the digestion period of the previous round of financial crisis stimulus, and the shifting period of growth rate.

So you may also be exposed to many authoritative interpretations recently to discuss whether the Chinese economy is U, V or L.

Compared with the financial crisis of 2008, the government showed greater patience and a clear attitude. It can not and is not necessary to use short-term stimulus to push economic growth.

Since the 38 years of reform and opening up, China's economy has experienced a very high growth rate since 1978. From the perspective of the growth trajectory of China's exports of goods, from 1978 to 2015, especially after 2001 China's entry into the market, exports showed a large growth trend, and the speed of development was also shocking, which is also a miracle in the whole world.

But at the same time, exports are growing very fast.

China is not only a world factory, but also a world market.

The financial crisis has brought a very big crisis to China's import and export and foreign trade. The most dramatic decline in global merchandise trade is a great change in the 2008-2009 year.

Judging from the export of goods, China's dominant export industry has undergone upgrading.

In the past, China accounted for a very high proportion of clothing exports in the export of China's goods trade, and it was a large number of foreign exchange earning exportation. However, in recent years, it has gradually given up its position. Taking 2014 as an example, exports of office and electronic equipment accounted for 595 billion US dollars, and textiles and garments accounted for 187 billion US dollars.

Cotton situation -- from the change of cotton production in the past 15 years since entering the market, the cotton output in 2001 was 5 million 320 thousand tons and 5 million 610 thousand tons in 2015. We see an interesting phenomenon, that is, after 15 years, the output of cotton has returned to the beginning of this century, that is, the initial stage of the market entry.

Look at our cotton demand from 5 million 660 thousand tons in 2001, second years and 6 million 500 thousand tons, and 2015 in the United States Department of agriculture, which is 7 million 80 thousand tons (the industry thinks about 6000000 tons). It is also an interesting regression. From output to demand, we are back to the level of the beginning of this century.

Under the new pattern, the development of China's cotton industry has experienced a period of rapid development. Whether it is an economy or a person, there will be some big consumption in the internal functions, and some structural adjustment and necessary recovery are needed.

In the field of production, China's cotton production is faced with problems such as "small scale, low efficiency, high cost, aging of agricultural labor force, and quickening the process of land pfer" and so on. In the field of circulation, the problem of quickening the integration and reorganization of processing trade enterprises is facing.

In the textile field, "competition intensifies, survival of the fittest, pformation and upgrading" has become the main theme, especially in recent years, the relocation of factories, with "pfer" to promote "pformation".

In 2014, there was a data that the domestic textile industry has invested more than more than 2600 textile, production, trade and product design companies in more than 100 countries and regions.

In recent years, building factories in the United States has also become a bright spot.

The average cost of industrial land in China is 5 times that of the United States, while the industrial electricity consumption in the United States is only 1/3 or even 1/2 in China, so it attracts a large number of Chinese textile enterprises to build factories in the United States.

In the 2010-2014 year, 60% of the US remanufacturing industry came from China.

Under the new pattern, our production pattern has taken up 1/3 of the three major cotton regions in the past, including the Yellow River, Changjiang and Xinjiang, and the three pillars have become Xinjiang dominated. The two major river basins in the mainland are gradually shrinking, processing layout, circulation layout and textile layout are being adjusted.

The traditional cotton industry growth mode and path are facing challenges. Under the new pattern, we should promote structural adjustment and pformation of development mode.

China's future cotton industry development, now the government emphasizes the supply side reform, from emphasis on high yield to quality, from decentralization to scale, from manual production to mechanization, from traditional trade to modern logistics and Internet +. Recently, the national development and Reform Commission released China's cotton logistics development and manufacturing advice, and it is also a common participation of the industry. This is also a great opportunity for the upgrading of the circulation sector, and the pformation of textile from big country to powerful country.

The future of China's cotton industry is arduous and long-term, but hope is still ahead of us.

I will report briefly, thank you!