New Flower Kai Scales: I Didn'T Expect Cotton Prices This Year.

From the perspective of China's market, China's textile and apparel terminal consumption has been in the doldrums for the past two years.

As economic growth continues to slow down and the dominance of various economic risks and real estate loans hit a new high, household income and expenditure will be severely squeezed. China's textile and apparel terminal consumer market will continue to be in a doldrums.

Cotton prices in the beginning of this year are opposite to that of the beginning of this year. In mid July, the price of cotton futures in China rose to a high level, and the price had dropped by 15%.

At present, the global economic growth rate is 2.5%, the lowest level in the past 40 years, and the low growth trend will continue for quite a long time.

In the whole

Under weak background, China's cotton textile demand will be more hurt.

Increasing supply and weak demand are the fundamental logic of weakening cotton prices.

A cotton grower in Akesu, Xinjiang, sighed, "I didn't expect cotton prices to be so low this year!" cotton farmers worry that seed cotton prices will fall below 6 yuan / kg by the middle of September.

A few days ago, news of new flowers began to spread.

In the Yellow River and Shandong, the price of seed cotton is 3 to 3.2 yuan / Jin, which is slightly lower than last year's level.

In the market of Xinjiang fine cotton and long staple cotton, as of now, most areas in southern Xinjiang and Northern Xinjiang have begun to scale.

Among them, the price of seed cotton scales in the southern Xinjiang region is 6.5 yuan / kg, compared with the 7 yuan / kg price in mid August.

First of all, since the middle of July, the amount of state-owned cotton storage has increased, and the market is expected to ease.

In August 8th, the Ministry of Finance announced that cotton throwing and storing time will be extended from the end of August to the end of September.

The time is basically linked to the new flower listing, and the spot market worries about the tight supply and demand of cotton during the blue and white period have been alleviated.

At present, the turnover rate is basically stable at around 60%, which is far from the previous 100% turnover rate, and the paction price is also weak. In the early September, the price of 3128 yuan was dropped at 14100 yuan / ton.

Secondly,

The domestic quantity of the main product is expected to increase, and the supply surface will be pressurized again.

In August, the US Department of agriculture's supply and demand report showed that the 2016/17 cotton planting area, unit area and output were expected to rise over the same period last year.

The report shows that the US cotton planting area in 2016/17 is expected to be 10 million 20 thousand acres, an increase of 14.4% over the same period last year. The yield per unit area is 800 pounds / acre, an increase of 4.4% over the same period last year, and the output is 15 million 880 thousand packs, an increase of 23.3% over the same period last year.

At the same time, cotton grows well in the main producing areas of China. The cotton growing area in the Yangtze River Basin has entered the flowering and Bolling stage. The Cotton Bolls at the bottom of some cotton fields in the the Yellow River River Basin have been bolting out. In the early September, they can be picked sporadically. In Xinjiang, Kashi and Turpan, a small amount of seed cotton has been listed on the market, and cotton enterprises are buying sporadically, and it is estimated that the cotton scale will start in the middle and late 9.

Third, from the downstream demand side analysis, there is no significant improvement in the international cotton textile industry this year.

Under the background of economic slowdown, the overall demand for textile and garment industry is weak, and the supply of upstream cotton yarn is overabundant.

In addition, from January this year, the price of international cotton yarn is higher than that of domestic yarn.

Once inverted 800 yuan / ton, import yarn price advantage no longer, making many customers accustomed to the use of imported yarn instead of domestic yarn.

However, in the current downward trend of prices, import yarn prices fell faster and faster than domestic yarn, and the price advantage of domestic yarn was lost.

As of August 25th, the price of domestic and foreign cotton yarn was 540 yuan / ton.

Due to the high price sensitivity of downstream customers, the demand for domestic cotton yarn is not optimistic.

From the point of view of American clothing imports, the import of clothing in the United States has been showing a warm state for the past two years, of which the import of pure cotton clothing continued to be weak.

According to the latest data, imports of clothing in the United States were in poor condition during the 1~6 months of this year. The import volume of pure cotton clothing, both from China and other countries and regions outside China, declined year on year, -2.67% and -2.63% respectively.

However, taking into account the background of 2016/17 global stock market going on inventory, excluding the drop in inventory from China's national cotton reserves, the international cotton inventory consumption is about 45%, which is at a slightly lower level.

In addition, the United States has been slow to raise interest rates because of poor economic data. The weakening US dollar has led to a rise in international commodity prices, including cotton.

From this level, the kinetic energy and space leading to the downward trend of the cotton market are also limited.