Increase In Imports Of Cotton And Port Stocks Continue To Decline?

According to customs statistics, in November 2019, China's cotton imports amounted to 110 thousand tons, an increase of 57% in the annulus ratio, a decrease of 15% over the same period last year. In 2019, China's total import of cotton was 1 million 700 thousand tons, an increase of 25% over the same period last year. It is understood that in September, China's port cotton inventory dropped from nearly 500 thousand tons to less than 300 thousand tons. The main reason for the continued decline in port inventory was the decrease in cotton imports. However, cotton imports increased significantly after November, but port stocks continued to show a downward trend.

From the point of view of the difference between domestic and foreign cotton prices, the difference between domestic and foreign cotton prices in November was reversed, and sales rhythm was slow. The sales situation has been improving since then. First, the difference between cotton prices and domestic cotton prices has gradually returned to the right direction, and the price performance of imported cotton has been improved. Two, the quality of Xinjiang cotton has generally declined in the new year, stimulating the downstream enterprises to increase the proportion of imported cotton in cotton blending; three, in 2019, 1% tariff quotas and sliding tax quotas are about to expire, prompting enterprises to increase the number of purchases to speed up the digestion quotas (the difference between domestic and foreign cotton prices is upside down, but the sales of imported cotton have not slowed down or are mainly affected by this factor).

According to some trade feedback from Qingdao port, the import of cotton in the near future is much faster than that in the early stage. Although the order of the downstream enterprises is not large, there are many small orders, and the market demand for Brazil cotton and high quality West Africa cotton is relatively strong.

In addition, the recent strengthening of the external market has further strengthened the confidence of port cotton traders. In the macro positive atmosphere, the market operation enthusiasm has also increased. It is estimated that China's cotton imports will continue to maintain over 100 thousand tons in December.