Pressure On Spot Purchase Of High Priced Cotton Is Increasing Day By Day.

By the latest US cotton supply and demand report released a major boost, the ICE cotton hit sharply, hitting a two-year high. Domestic cotton Zhengzhou continued to rally last week, moving up step by step during the week, and the domestic and foreign cotton was once strong resonance. Last week, the national cotton auction continued to be hot. Accordingly, the market demand side correspondingly. This week, the largest weekly output of the 150 thousand tons of domestic cotton has been launched since the launch of this week, and the actual spanaction has been completed, and the spanaction price has continued to hit a new high. The average weekly turnover has exceeded 14200 yuan / ton. It is expected that in the short term, the heat of market reserve cotton will not decrease, and the volume of trading will continue to run at a high level. The basis of high running cotton lint is still on the top.

It is almost the only way to supply domestic lint at present. At present, the situation of tight supply of market is still difficult to meet the demand of the market. In addition, the price of domestic and foreign cotton has been hitting a new high, and the market is constantly running out of information. Under the promotion of funds, the domestic and foreign cotton market has been out of the bull market for a long time. Although the spot market is not as good as the price, it has been developing rapidly. The downstream market is under great pressure. Some of the lower part of the week has already been tentatively raised. Although the price of the yarn has not risen much faster than that of the raw lint, it is difficult to accept the short-term increase in the gray cloth and clothing market. Because the state stores cotton still

Zhengzhou cotton main contract CF1701 broke through 16000 yuan / ton during the week, but the increase in spot price of Xinjiang cotton in 2015/16 was significantly weaker than that in Zhengzhou cotton futures company. In July 14th, the actual spanaction price of 3128B grade hand picked cotton was 14200-14400 yuan / ton (public), while the high grade hand picked Xinjiang cotton price was 14800-15000 yuan / ton, because the quality difference was higher or higher. Individual merchants shouted, after selling a handful of monads, they were ready to raise their prices. At present, some businesses offer 2328 level quotations at 14200 yuan / ton, and even if spinning enterprises and middlemen buy a lot, Trader There is little room for profit. The price of FOB, CNF and CIF of 2015/16, 2016/17 and FOB rose by 4 cents / lb during the week. Some foreign businessmen generally bet that Chinese buyers will gradually accept passively.

Although the national cotton storage is still the main channel for domestic cotton resources supply, about 35-40% of the national cotton reserves are in the hands of cotton traders. Reserve cotton The willingness to leave the warehouse is not strong, and because of the large amount of output from the warehouse, the actual cotton flow into the cotton mill warehouse is estimated to be less than 50% of the turnover volume, which directly leads to a lot of problems. Cotton mill "No rice under the pan".

Because of the low price of the new cotton spot in 2015/16, spinning enterprises and spinning 40S and below cotton yarn are difficult to digest the high cost of cotton price. 1%, the import quota of cotton within the tariff is concentrated in the hands of large and medium-sized cotton textile enterprises and operators. Therefore, the spinning enterprises can only purchase the stock from the national cotton store, but if they want to get the raw materials, they can only take food from the tiger's mouth. Especially in the recent part of the downstream textile enterprises, low cost cotton stocks have consumed almost the same amount, especially for small and medium sized enterprises.

The cost pressure caused by the sharp rise in cotton prices is gradually downward to yarn, cloth and clothing spanmission. But compared with the substantial increase in the spanaction price of Zheng cotton and reserve cotton, the actual price of cotton yarn has only risen by 300-800 yuan / ton. Some enterprises spinning C40S and the following count cotton yarn not only have no profits but have a loss of 500-1000 yuan / ton, while the downstream intermediaries and weaving mills are not strong in digestion capacity. The enterprises reflect that the inventory of medium and low count yarn and conventional yarn has increased rapidly, facing the current situation, some enterprises are ready to reduce or stop production to ease the pressure.

Last week, a total of 149 thousand and 300 tons of domestic cotton reserves were planned for sale, which increased by about 25 thousand and 600 tons compared with last week, and the largest weekly output volume since the completion of the auction. The total sale price was 13053 yuan / ton last week. The price rose 418 yuan / ton compared with the previous week. During the week, the average price of the national cotton store continued to rise sharply to 14234 yuan / ton, up 91 yuan / ton compared with last week, and the highest price in the week actually exceeded 15000 yuan / ton mark to 15350 yuan / ton, and the lowest price was 12890 yuan / ton. As of July 15th, the total output of national cotton reserves was 1 million 359 thousand and 660 tons (1 million 57 thousand and 800 tons of domestic cotton and 301 thousand and 900 tons of imported cotton). The actual turnover was 1 million 339 thousand and 350 tons (1 million 37 thousand and 500 tons of domestic cotton and 301 thousand and 900 tons of imported cotton); the total actual turnover ratio was 98.51% (domestic cotton 98.08%, imported cotton 100%).

Overseas cotton storage is still the only way to supply cotton resources in China. In the downstream textile enterprises, it is generally expected that a large number of new cotton to the mainland market will be around November, and the storage will basically end at the end of August. There will be a blank period of 2-3 months in the middle. The textile enterprises are ready to complete the corresponding inventory in the current dumping stage. The current demand for reserves is not enough, and the early traders are all running low inventory, and there are replenishment operations demand in the market, so the trend of the overall cotton market is expected to continue.