Downstream Orders Gradually Warmed Up Domestic Yarn Price Increases The Competitiveness Of Imported Yarn

According to customs statistics, in October 2019, China exported $22 billion 868 million of textiles and clothing, down 6.74% from the same month, down 1.7% from the same period last year. Compared with September, the reduction of the ring ratio increased significantly, and the decrease was narrowed compared with the same period last year. In 2019, 1-10 months in September, China exported 224 billion 870 million US dollars of textile and clothing, down 3% from the same period last year, indicating that China's exports of textiles and clothing showed signs of bottoming up in 10-11 months, slowing down compared with the same period (according to statistics. In September, the US imports of Chinese clothing decreased by 13.2% in volume, leading to a 7.85% decline in China's textile and clothing exports in September.

Some weaving enterprises and traders in Guangdong, Jiangsu, Zhejiang and other places reflect that since October, orders for developed countries and regions such as Europe, the United States, Australia and Canada have been gradually warming up (mainly short, small and multiple batches), and the inquiry and delivery of C21S-40S high package bleaching yarn and JC32S and 40S compact spinning are much more positive than that in 8-9 months. The contract volume of OE yarn, C8S-16S siro spinning bonded warehouses and futures yarn has been decreasing continuously. From the side, the situation of China's cotton textile, clothing, foreign trade companies and other terminals has finally come to a stable and rebound opportunity after 8-9 months' dark time.

From the statistics and estimation of several large traders and importers, it is estimated that about 16-17 tons of cotton yarn arrived in October, an increase of more than 20% over the same period (an increase of 23-25% in some institutions). The growth of India yarn and Pakistan yarn is more obvious, followed by Uzbekistan yarn and Vietnamese yarn. And the cotton yarn count of 16S and above increased significantly before September, and OE yarn and low yarn arrival rate declined rapidly. On the one hand, in recent years, the export orders have picked up in a pick-up stage. The supply of C21S and 32S in the coastal areas is tight due to the supply of yarn. The exporters and traders rush to transport or purchase imported yarn from other ports. On the other hand, the RMB continues to appreciate, and the import costs of cotton and cotton yarns continue to float downward, and the price of domestic cotton mills is generally raised by 300-500 yuan / ton since November, and the competitiveness of imported yarn is enhanced. In November 5th, the central bank for the first time reduced the MLF interest rate by 5 basis points for the first time. The signal significance is clear, and it is clear that the domestic interest rate reduction space should be opened. Equity asset valuation and domestic liquidity environment are expected to improve. It is expected that there will be another two MLF interest rate adjustments next year, with a reduction of about 10 basis points each time.