Speeding Up The Reform Of Market System Is The Way Out For China'S Cotton Industry.

In August 3, 2016, reporters interviewed China.

Mr. Sun Huaibin, Deputy Secretary General of the Federation of industry, analyzes the current cotton problem from the perspective of industry.

background

Since March this year,

Prices climbed steeply, futures prices soared nearly 70%, and the average market price increased by more than 3000 yuan per ton.

The cost is high and the price of commodities can not be raised. Many textile enterprises are facing the situation of losing money.

In the environment of fluctuating cotton prices, some enterprises choose to suspend production in the form of holidays or factory closings.

In July 26th, the information released by the national development and Reform Commission website showed that the average selling price of the standard grade lint in the mainland was 12596 yuan / ton, rising by 1.6%; the average price of Xinjiang standard lint sale was 12260 yuan / ton, which was basically the same as last month; the settlement price of Zhengzhou cotton futures contract was 13154 yuan / ton, up 4.7% compared with the previous month; the average price of the electronic matching paction contract in the national cotton exchange market was 12925 yuan / ton, which rose 7.3%.

Data show that over the past three months, the market has been thirsty for cotton reserves, and the cumulative turnover has exceeded 1 million 600 thousand tons.

It is reported that the demand will be extended for a month, because the demand is very urgent. The total turnover will reach more than 2 million 200 thousand tons.

For the current situation, for enterprises, the supply of cotton is in short supply.

The new cotton has not yet been collected, and the old cotton is subject to quota control in the state treasury and imported cotton.

The stock has exceeded ten million tons, which is equivalent to the quantity of cotton consumption for two years. At the same time, in response to the supply side reform "going out of stock", the relevant departments have adopted the national cotton storage policy.

Present situation

The state issued a notice on rotation of cotton reserves in April 15, 2016. Two points need to be addressed:

1, under normal circumstances, the daily sales of cotton reserves will not exceed 50 thousand tons.

2, if the market price of domestic and foreign market has obviously increased rapidly during a period of time, the auction rate of cotton reserves will exceed three days a week, and the number of listed sales will be increased appropriately.

In May 3, 2016, the national cotton reserves were officially put into operation, and nearly 1 million 500 thousand tons were put into operation in the middle and late 7. The actual daily listing (less than 50 thousand tons) or less than 30 thousand tons, but the turnover rate was very high, generally 97%~98% or even 100%.

This shows that the national cotton storage can not meet the needs of enterprises, that is, the amount of delivery is insufficient.

Therefore, the short term gap has led to higher and higher auction prices, while the current price of cotton is getting higher and higher, and the futures price has also increased rapidly.

Commercial speculation took the opportunity to join, making the domestic cotton price in the short term increased by more than 2700 yuan per ton, futures price increased by more than 5000 yuan.

For cotton enterprises, the most feared is cotton prices rising and falling rapidly in the short term, especially rising.

Because of the rapid rise of cotton prices, yarn, cloth and other prices can not respond quickly, so that enterprises, especially small and medium-sized enterprises can not cope with the cost pressures brought about by the increase in cotton prices, the more losses the company produces, the more it can only stop production by cutting production.

Reason

The root cause of the current cotton problem is: insufficient input of national cotton stores.

1, the national cotton purchase and storage when a large number of intake and inspection is not strict, resulting in no guarantee of quality. Now when the state stores increase the intensity of public inspection, packet inspection will inevitably increase the intensity and difficulty of the public inspection work, and the number of outlets is small.

2, opportunities for commercial speculation appear. Non productive enterprises participate in auctions with cotton enterprises, and Stockpiling and markup increase, leading to price inflation in the short term.

proposal

A. increased the amount of delivery to 50 thousand tons in line with the announcement.

B. restrict non production enterprises and companies from participating in cotton auction

C. issued quotas to import cotton to make up for the domestic cotton gap and stabilize domestic cotton prices.

conclusion

Speeding up the market system reform is the way out for China's cotton industry.