CY2001 Contract Delivery 132 Hands 660 Tons, Cotton Yarn Futures To Complete The First Delivery Under The New Rules

Recently, Zheng Shang cotton yarn futures completed the first delivery of the revised rules. The CY2001 contract delivered a total of 132 hands, equivalent to 660 tons of cotton yarn. According to the official responsible for Zheng Shang, 2 of the 33 standard warehouse receipts were warehouse receipts, which marked the completion of the first single warehouse delivery of cotton yarn futures, and became another cotton futures chain after the cotton production.

One of the parties involved in the warehouse delivery is the wholly owned subsidiary of the world top 500 enterprise, Zhongda Group, the largest cloud company in China. In Dayu's business, Dayun merchants take the textile raw materials as the main business, and take the business of making deep and thin textile plates as the goal, and make use of their current business advantages to cooperate with the textile mills to sell 180 tons of cotton yarn with a price of 20650 yuan / ton, 140 tons at 19400 yuan / ton, and the remaining 40 tons into the cutting link. The company produced the first single cotton yarn futures standard warehouse list for Hubei Xiao Xiao Cotton Industrial Group Co., Ltd. and Xinjiang Ruyi Textile Garments Co., Ltd., and successfully completed the sorting process from all aspects of warehousing, registered warehouse receipt, delivery and delivery.

Weishi Textile Co., Ltd. is located in Weishi County, Henan province. It mainly produces yarn and yarn such as pure cotton and blended yarn. It has 200 thousand spindles and 3000 air streams. The annual output of cotton yarn is 25 thousand tons. The products cover combed, compact spinning high grade cotton yarn, high 20 ~40 cotton yarn, air spinning 10 ~16 cotton yarn and so on. The company also established a solid raw material supply base in Xinjiang, with two cotton processing plants, and formed a complete industrial chain enterprise for cotton cultivation, purchase, processing, spinning and export.

As one of the delivery bases of cotton yarn futures, Weishi textile also participated in the delivery of the CY2001 contract, and used futures market to manage risks during the epidemic. At the beginning of this year, a new crown pneumonia outbreak occurred in China. Facing the unoptimistic situation in the cotton spinning market, Weishi textile decided to deliver all 100 hand cotton yarn. According to the experience of the previous two deliveries, Weishi textile has been registered as warehouse receipts efficiently, and the final settlement price is 19730 yuan / ton, and the profit is about 1 million yuan.

Reporters also learned that during the Sino US trade negotiations in May 2019, Weishi textile based on the analysis of downstream orders, yarn mill inventory and other factors, the price of cotton textiles will be predicted to fluctuate significantly. In order to deal with the risk of price fluctuation caused by various uncertain factors in the market, Weishi textile decided to sell hedging with cotton yarn futures. From May 2019 to December, Weishi textile sold 1055 cotton yarn futures in the CY2001 contract, and the average selling price was 20835 yuan / ton. Later, cotton and cotton yarn prices dropped sharply. Due to locking profits in advance, the profit in the futures market effectively compensated for the losses in spot sales of Weishi textile products during the sharp decline in spot prices, which saved more than 60 yuan. Among them, through buying cotton and selling cotton yarn cross species arbitrage mode, Weishi textile achieves a profit of 75 thousand and 600 yuan.

Li Youyin, chairman of Weishi textile industry, said: "since the launch of cotton yarn futures, Weishi textile has participated in the 3 delivery. From the initial tens of tons and more than 100 tons to 500 tons of the CY2001 contract, the company's participation income has increased from the initial tens of thousands of yuan to hundreds of thousands of yuan to the current about 1000000 yuan. This delivery is a breakthrough for Weishi textile in terms of futures trading volume and revenue, and has accumulated experience for future enterprises to make better use of cotton yarn futures in production management and risk management.

Li Youyin also said that cotton yarn futures as the most direct hedging varieties, cotton yarn production and operation enterprises to cope with the sharp fluctuations in the market, the role of other varieties can not be replaced, and cotton and cotton yarn price correlation is high, the upper and lower reaches of the dual varieties, can well serve the industrial customers, as the market matures, will also be in the market direction, industry pricing and so on. Play the role of "vane".

It is understood that, in order to better promote the market function of cotton yarn futures, in March 4, 2019, Zheng Shang officially issued the "cotton yarn futures related business rules amendment" to optimize the cotton yarn futures benchmark delivery and substitutes quality index system, and open warehouse delivery mode, which provided an institutional foundation for the realization of cotton yarn futures activity.

Since May 15, 2019, cotton yarn futures have launched a real market selection competition to provide initial liquidity for cotton yarn futures trading. Data show that with the formal implementation of the new contract rules and the market maker system, cotton futures trading volume and position have gradually increased, which has been initially active. As of the beginning of April this year, the average daily turnover and position of cotton yarn futures reached 8816 hands and 7874 hands (one side, the same below), respectively, which increased by 97% and 607% respectively compared with the revised rules, and the overall turnover rate reached 1.1. Judging from the delivery situation, cotton yarn futures have delivered 4 deliveries since the listing, namely, CY1801, CY1810, CY1901 and CY2001, with a total delivery volume of 216 hands, or 1080 tons.