Why Do Spinning Enterprises Have A Special Preference For Cotton Reserves?

According to statistics, since May 3rd

Since the curtain broke out, as of May 20th, the cumulative turnover of cotton reserves in the 2015/2016 year has reached 407 thousand and 500 tons, and the auction rate has reached over 99%. Among them, 241 thousand and 700 tons of cotton imports and 100% cotton were imported in 2012, and the turnover rate of domestic cotton was also around 98.5%. In a short period of 14 trading days, the turnover volume was more than 6 times of the total turnover in 2014/15.

In my opinion, in addition to the inspection and re inspection of cotton reserves, the reserve cotton is conducive to the competition of textile enterprises and traders, and there are several reasons to maintain the high turnover rate.

1, apart from the auction of cotton reserves, a large part of textile enterprises have no channels to replenish raw materials, especially small and medium-sized enterprises.

Market estimates of China this year

The supply gap or the output of 120-150 tons and 2 million tons of cotton reserves can completely meet the demand of new cotton pre market textile enterprises. However, the structural contradictions of domestic cotton resources in 2015/16 have been highlighted, and this imbalance has been exaggerated and even hyped.

By the end of May, Xinjiang cotton specialized warehouses in and outside China still had about 348 thousand tons (according to the national cotton market monitoring system data, as of May 20th, Xinjiang's cotton processing volume was 3 million 645 thousand tons and sold 3 million 297 thousand tons), but the supply of goods was scattered, the quality and the spinnability were low, basically the market was short, and the textile enterprises were able to meet the stability of production, the stable quality of the yarn and the stable competitiveness of the products. They could only abandon the Xinjiang cotton spot, while the port bonded and spot shipment were still available, such as the United States cotton, Ukrainian cotton, West African cotton and Australia cotton, but the quota was insufficient, and the quota was cleared again. The cost was high and obviously the cotton enterprises could not afford it.

2.

Although there is a gap between the quality and the cotton and Xinjiang cotton in 2015/16, it is 500-2000 yuan / ton below the spot price.

For spinning C21S-C40 cotton yarn manufacturers, since the 10500-12000 yuan / ton reserve cotton can meet the quality requirements of cotton blending and contract, why do we need to buy 12800 yuan / ton or even 13000 yuan / ton for Xinjiang cotton spot?

3. The reserve price of the reserve cotton wheel is priced according to the color level, fiber length, micron value, fracture strength and other indicators, and the cotton price difference of each grade is drawn up, which is contrasted with the quotation confusion in the spot market.

In 2014 and 2015, the state completely withdraw from the market, and the cotton is back to the market economy. For many spinning enterprises with 40S and above yarn, the 31 grade lint is basically the same as the 21 grade in cotton blending, spinning and weaving process. Therefore, the price difference between 2128 and 3128 grades is only 50-100 yuan / ton, or even no price difference.

Reserve cotton is strictly priced according to the reinspection standard. "Low quality, low price, high quality and high price" conforms to the expectations of the market and the buyer, reducing the appearance of blindly increasing the price, shooting and shooting.