Why Do Cotton Companies Hesitate To Scale?

Since September, cotton picking has been launched in various cotton regions, and sporadic acquisition of seed cotton has also been reported in some regions. The purchase price is floating against the Xinjiang level.

Recently, most cotton areas in China have fine weather and adequate sunshine, which is very conducive to cotton picking.

At present, with the approaching of national day, cotton picking progress is speeding up.

However, at present, there are few cotton enterprises in all cotton producing areas. Why are cotton companies reluctant to scale up?

Although there was a forecast on the market at the beginning of the month, it was thought that since the beginning of 9 in the middle of the month, the amount of cotton seed in the mainland began to increase. However, due to the current factors that affect seed cotton prices, such as weather quality, the quality of cotton in the part of the affected areas in the mainland is expected to decline, the price of cottonseed has a downward trend, the new "overrun regulations" or the cost of lint road pportation, and the expected price of new cotton flowers in 2017 will be restricted.

First, cotton everywhere.

The price is 3.25-3.52 yuan / Jin, and the picking progress in some areas is nearly half.

At present, the price of cotton purchase and the expected price of cotton farmers are 4.5 yuan / Jin and the gap is too large. The market will be in a stalemate. In addition to the price, it is the busiest time for farm work. The peak sale of seed cotton is expected to be in mid 10.

Two is from the present.

Look, new cotton is temporarily difficult to increment.

At present, downstream textile enterprises and traders are still concentrating on the auction of reserve cotton, although the demand for terminal textile enterprises is not as good as that of the same period last year, but the traditional peak season has increased the intensity of the replenishment of textile enterprises.

Recently, the cotton market has been raised and the market mentality has been raised. In addition, the state reserve price has been drawing to a close.

At present, there are 2 working days for the national cotton store to go out, and the insufficient supply will continue to support the high turnover rate of national cotton reserves.

At present, cotton enterprises do not want to be generous in processing.

Three, before the Mid Autumn Festival, due to the higher cost of seed cotton and the relatively limited number of new stocks listed in the new season, the price of cottonseed at home was higher then, while cottonseed processing enterprises in some areas had higher willingness to purchase actively, and the price of cotton seeds before the mid autumn Festival was very high.

For example, the price of cotton seed in Shandong area to the factory cost was once the highest close to 1.75 yuan / Jin, and the local price was about 1.70 yuan / kg. The current price in Xinjiang area is between 1.35--1.45 yuan / Jin, and it also belongs to a higher level.

However, such a high price of cottonseed is difficult to make profits for squeezing enterprises, and downstream enterprises are also widespread.

This phenomenon has restrained the pace of the acquisition of squeezed enterprises, and accelerated the pace of the new cotton seed sale in the new season.

Among them, the purchase price of local cottonseed in Shandong was reduced to 1.65 yuan / Jin, while the purchase price in Xinjiang was down to 1.25--1.35 yuan / Jin.

Cotton seed prices fell sharply, cotton processing enterprises also dare not hastily purchase, waiting for cotton seed prices stable after the purchase of scale.

Four, at present, most of the cotton enterprises' acquisition funds have not yet been put in place. Cotton enterprises take into account the significant reduction in cotton this year. The longer the acquisition time is, the more they will lose. Most of them are prepared to postpone the settlement. We expect that the purchase price of seed cotton will fall back in early 10, so as to reduce the settlement price.

To sum up, at present, the acquisition work of cotton processing enterprises is relatively cautious, and cotton farmers are reluctant to sell emotions. After the Mid Autumn Festival, cotton purchasing is still not booming. It is expected that a large-scale purchase will be postponed to national day.

The peak will be reached in mid October, and there will be some downward pressure on seed cotton purchase price.